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Renew | September 2018

"RPO's must be made mandatory"

&quot;The enunciation of the new Wind-Solar Hybrid Policy is a reaffirmation of the federal government's commitment to support new and emerging technologies,<span style="font-weight: bold;">&quot; tells Vikram Kailas, Vice Chairman &amp; Managing Director, Mytrah Energy India Pvt Ltd in an exclusive interaction with POWER TODAY. &quot;</span>An important cornerstone of the policy is power purchase by government agencies from new projects. In this front, the policy is lacking on a clear plan for converting existing projects of wind and solar into hybrid units,&quot; he adds. As one of the leading wind energy producers in India, the company owns and operates assets in Rajasthan, Gujarat, Madhya Pradesh, Maharashtra, Andhra Pradesh, Telangana, Karnataka, and Tamil Nadu. The Hyderabad-based firm also sells power primarily to state grids and industrial consumers on long-term agreements. <p></p> <p> <span style="font-weight: bold;">As one of India's leading independent power producers, what is your take on the recommendations of the new national Wind-Solar Hybrid Policy?</span><br /> By notification of this policy, the central government has clearly indicated its willingness to support the use of new technologies and methods for combined operation of wind and solar projects. This also gives a clear mandate to central procuring agencies like Solar Energy Corporation of India (SECI), NTPC, and the states for inviting bids for hybrid projects on a transparent, tariff-based bidding process. We, at Mytrah, believe that this is a step in the right direction and will augment efforts to realise the country's target of achieving 175 GW of renewable energy capacity by 2022. However, the policy lacks a clear framework for converting existing wind or solar projects into hybrid projects. It instead focuses solely on procurement by government agencies from new projects, which is a shortcoming.</p> <p><span style="font-weight: bold;"> Will the integration help you bring down operational costs and by how much?</span><br /> Issues related to grid availability for evacuating new renewable energy power continue to exist. Further, construction of new transmission systems or augmentation of existing systems is not likely to keep pace with planned renewable capacity addition. This poses a major challenge in terms of evacuation of power to a non-resource state. Also, in many instances, the cost of connecting to a far-off central grid versus supplying to a state grid can significantly impact project feasibility. Use of a hybrid system will ensure optimal and efficient use of transmission infrastructure, and hence will help in spreading the common evacuation cost over the wind and solar projects. That said, acquisition of contiguous land for solar projects around the wind-rich sites will continue to pose a challenge.</p> <p> <span style="font-weight: bold;">How well-prepared are you to adopt new technologies?</span><br /> Mytrah Energy leverages its robust end-to-end capabilities ranging from site selection to financing; procurement, project execution, and asset management to efficiently generate clean power from its portfolio of 2.2 GW of renewable power assets. Mytrah's adoption of technology across the renewable power development and generation value chain makes us a pioneer in this space. Our in-house technical team is well geared to deliver on new emerging technologies like hybrid, floating, and storage.</p> <p> <span style="font-weight: bold;">It is being suggested that going hybrid will, among other things, significantly help curtail the irregularity in the wind and solar energy generation. However, cannot that be taken care of to a large extent through the development of a robust storage infrastructure?</span><br /> Yes, the use of storage in hybrid projects will optimise output and reduce the variability of power supplied. Wind-solar hybrid plants will then be able to ensure round-the-clock power supply, allow for higher energy input at delivery points, and ultimately become reliable sources for meeting base load demand. That is why the policy permits storage in hybrid projects. Since the current prices of battery-based storage systems will push the renewable energy tariffs higher, the policy does not restrict itself to this form of storage alone. It allows for other forms, including pumped hydro, compressed air, flywheel, etc., to be used. However, storage should not be considered as the only tool available for tackling intermittency and providing grid stability. The focus should also continue on developing better forecasting techniques, the ancillary services market, and demand-side management.</p> <p> <span style="font-weight: bold;">Can hybrid units of wind and solar actually help improve yields for investors?</span><br /> The only meaningful cost-saving in hybrid projects will come from the sharing of common evacuation infrastructure costs between the wind and solar elements of projects. So the tariff will be crucial in determining returns. Recently, 2.5 GW of new wind-solar hybrid tender issued by SECI benchmarked the tariff at Rs 2.93 per kWh, which is the same as that for individual central transmission utility (CTU) connected wind and solar projects. In such a scenario, the scope of additional earning or any substantial savings over solar- or wind-only projects is doubtful. So, improved yield is not a foregone conclusion. The bid submission deadline for the SECI tender has been amended multiple times and is now scheduled for early September. This bid will provide further clarity on how things are likely to evolve.</p> <span style="font-weight: bold;">How can the hybrid policy be made into a potent means to achieve the objective of augmenting both wind and solar power generation, consistent power supply, and resolution of difficulties faced by developers in land acquisition?</span><br /> First, to facilitate the effective implementation of hybrid projects, each solar bid should include a minimum amount of storage. Second, the central government should review and revise the processes and approvals required for the use of hydro storage technologies in hybrid plants. Third, through lower finance costs and tax benefits, it should incentivise large-scale private investments in battery manufacturing and lithium sourcing. And, finally, when it comes to the incremental capacity added to the existing wind and solar projects, offtake of power by respective distribution companies should be made mandatory and a separate feed-in tariff mechanism should be adopted for such projects. <p></p> <p> <span style="font-weight: bold;">&quot;Acquisition of contiguous land for solar projects around the wind-rich sites will continue to pose a challenge.&quot;</span></p> <p> - Manish Pant</p>
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