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Renewable Energy Sector Makes Rapid Strides in 2019; Installed Re Capacity Crosses 84GW; Nearly 1o GW Re Capacity Added in 2019

IBEF:  January 10, 2020

As a part of Nationally Determined Contributions as per the Paris Accord on Climate Change, India has made a pledge that by 2030, 40 per cent of our installed power generation capacity shall be from non-fossil fuel sources and also by 2030, reduce emission intensity of GDP by 33-35 per cent from 2005 level. Economic growth, increasing prosperity, a growing rate of urbanisation and rising per capita energy consumption has increased the energy demand of the country.

Keeping in view the above and our commitment for a healthy planet with less carbon intensive economy, we decided in 2015 that 175 GW of renewable energy capacity will be installed by the year 2022. This includes 100 GW from solar, 60 GW from wind, 10 GW from biomass and 5 GW from small hydro power. The substantial higher capacity target will ensure greater energy security, improved energy access and enhanced employment opportunities. With the accomplishment of these ambitious targets, India will become one of the largest Green Energy producers in the world, surpassing several developed countries.

The Prime Minister in his address at to Climate Action Summit stated that "India's renewable energy capacity would be increased to much beyond 175 GW, and later till 450 GW". In line with the objective of expanding renewable energy sector, several important initiatives were taken during year 2019.

Renewable Energy capacity is rising rapidly and the status of projects as on 17.12.19 is given below:

Sector Installed capacity (GW) Under Implementation (GW) Tendered (GW) Total Installed/ Pipeline (GW)
Solar Power 32.53 25.05 25.78 83.36
Wind Power 37.28 9.64 2.20 49.12
Bio Energy 9.94 0.00 0.00 9.94
Small Hydro 4.65 0.55 0.00 5.20
Wind Solar Hybrid 0 1.44 0.00 1.44
Round the Clock (RTC) Power 0 0.00 1.60 1.60
Total 84.40 36.68 29.58 150.66

MAJOR INITIATIVES UNDERTAKEN DURING THE YEAR 2019

1. Kisan Urja Suraksha evam Utthaan Mahabhiyan (PM-KUSUM)

In a major initiative towards making Annadata also a Urjadata PM-KUSUM scheme was approved on 8th March 2019 and implementation guidelines were issued on 22.7.2019. State-wise allocation of capacities for the first year was made on 13.8.2019. The scheme covers grid-connected RE power plants (0.5 - 2 MW)/ Solar water pumps/ grid connected agriculture pumps and has following three components:

Component A: Installation of 10,000 MW of Decentralized Ground Mounted Grid Connected Renewable Energy Power Plants by farmers of 500 kW to 2 MW capacity within 5 km distance from sub-station primarily on barren/uncultivable land. The DISCOMs will purchase power at pre-fixed tariff for which they will get PBI of Rs 0.40 (US$ 0.006) per unit up to Rs 33 lakh (US$ 47,217.05) per MW in a span of five years.

Component B: Installation of 17.50 lakh standalone Solar Powered Agriculture Pumps for which Government of India will provide financial support up to 30 per cent of the cost of solar pump and States to also provide at least 30 per cent of the cost of solar pump, balance cost to be shared by the beneficiary farmer. (For NE and hilly States/UTs the Central support would be up to 50 per cent of the cost of solar pump)

Component C: Solarisation of 10 Lakh existing Grid-connected Agriculture Pumps for which Government of India will provide financial support up to 30 per cent of the cost of solarisation and States to also provide at least 30 per cent of the cost of solarisation, balance cost to be shared by the beneficiary farmer. (For NE and hilly States/UTs the Central support would be up to 50 per cent of the cost of solarisation)

Targets: Setting up of 25,750 MW additional solar capacity by 2022.

Implementing framework: Scheme will be implemented by agencies designated by States for the three components in the respective states as per implementation guidelines issued by MNRE. Centralised tendering envisaged for Component-B. Centralised tendering for 1.75 lakh solar pumps Component-B completed by EESL (Energy Efficiency Services Ltd.) and States started implementations of Component-B. For Component-A and C the States have to initiate process as per Guidelines.

2. Standard bidding guidelines

The Ministry has issued Guidelines for Tariff Based Competitive Bidding Process for Procurement of Power from Grid Connected Solar & Wind Power Projects with an objective to provide a framework for procurement of solar & wind power through a transparent process of bidding including standardisation of the process and defining of roles and responsibilities of various stakeholders.

In order to strengthen the contractual provision in the Contract (Power Purchase Agreement) between the solar power generators and the Procurers, and to facilitate setting up of solar power projects, the Government, vide notification dated 22.10.2019 from Ministry of New & Renewable Energy, has made following major amendments to the ‘Guidelines for Tariff Based Competitive Bidding Process for Procurement of Power from Grid Connected Solar PV Power Projects:

(i). Solar Power Generators have been allowed to submit documents/Lease Agreement to establish possession/right to use 100 per cent (hundred per cent) of the required land in the name of the Solar

 Power Generator for a period not less than the complete term of the PPA, on or before the Scheduled Commissioning Date (SCD).

(ii). Clear and elaborate provisions for time extension and compensation to affected party in the event of natural and non-Natural Force Majeure events with specific provisions regarding termination due to natural and non-natural Force Majeure events have been included.

(iii). Quantum of Compensation for back-down has been increased from 50 per cent to 100 per cent with provision for recognition of only written instructions of back-down and payment of back-down compensation.

(iv). Corresponding Time Extension in date for achievement of financial closure and scheduled commissioning date, in case there is a delay in adoption of tariff by the concerned Electricity Regulatory Commission beyond a period of 60 days from the filing of such application.

Similar relaxations were also made for wind power bidding guidelines.

3. Development of Ultra Mega Renewable Energy Power Parks (UMREPPs)

This Ministry has undertaken a scheme to develop Ultra Mega Renewable Energy Power Parks (UMREPPs) under the existing Solar Park Scheme. The objective of the UMREPP is to provide land upfront to the project developer and facilitate transmission infrastructure for developing Renewable Energy (RE) based UMPPs with solar/wind/hybrid and also with storage system, if required.

The implementing agency of the UMREPPs may be a Special Purpose Vehicle (SPV) in form of a Joint Venture Company (JVC) to be set up between Central Public Sector Undertaking (CPSU) and any State Public Sector Undertakings (SPSU) or State Utility or Agency of the State Government or a SPV fully owned by any CPSU or a SPV fully owned by any State PSU / State Utility / Agency of the State Government.

NTPC, SECI, NHPC, THDC, NEEPCO, SJVNL, DVC, NLC and PFC have proposed to set up UMREPPs of around 42,000 MW in various states.

4. Grid-Connected Rooftop Solar (RTS) Programme

Phase II of the Grid connected rooftop solar programme was approved with a target for achieving cumulative capacity of 40,000 MW from Rooftop Solar (RTS) Projects by the year 2022 in February 2019. In the Phase-II Programme, Central Financial Assistance (CFA) for the residential sector has been restructured. Important features of the Phase-II of RTS are as under : -

·  Power Distributing companies (DISCOMs) will be the implementing agencies

·  Subsidy/CFA will be available for the residential sector only

·  CFA under residential category will be provided for 4000 MW capacity and the same will be provided on the basis of benchmark cost or tender    cost, whichever is lower.

·  For RTS systems up to 3 kW, CFA is 40 per cent; for capacity above 3 kW and up to 10 kW, CFA is 40 per cent for first 3 kW and 20 per cent for       balance quantity; for capacity above 10 kW, CFA is 40 per cent for first 3 kW and 20 per cent for next 7 kW. No subsidy beyond 10 kW capacity.

·  For Group Housing Societies/Residential Welfare Associations (GHS/RWA), CFA will be limited to 20 per cent for RTS plants for supply of power    to common facilities; however, the capacity

  eligible for CFA for GHS/RWA will be limited to 10 kW per house with maximum total capacity up to 500 kWp.

·  Residential Consumers/Group Housing Societies/Residential Welfare Associations have to pay only balance amount after deducting the CFA to    the empanelled vendor for installation of the RTS project

·  For availing the benefit of CFA, indigenously manufactured PV Modules and Cells are to be used.

·  Performance based incentives will be provided to DISCOMs based on RTS capacity achieved in a financial year (i.e. 1st April to 31st March every    year till the duration of the scheme) over and above the base capacity i.e. cumulative capacity achieved at the end of previous financial year.

5. Solar PV manufacturing

Government Producer Scheme for setting up Solar PV Power plants using domestically manufactured SPV cells & modules

Government have approved a Scheme [CPSU Scheme Phase-II (Government Producer Scheme)] for setting up of solar PV power plants by Government Producers [Central Public Sector Undertakings (CPSUs)/ State Public Sector Undertakings (SPSUs)/ Government Organisations, etc.], as per extant Guidelines, in a World Trade Organization (WTO) compliant manner, using domestically manufactured solar PV cells and modules to encourage 'Make in India' in Solar PV Manufacturing sector.

Solar PV Manufacturing linked PPAs for Solar Power Plant

Tenders for setting up Solar PV Manufacturing Capacities in India linked with assured off take in the form of PPAs for Solar Power Plant has been finalized. SECI has already concluded a bid for one such tender under which 2-3 GW of Solar PV Cells &Modules manufacturing capacity linked with 8-12 GW of Solar PV Power plants capacity is likely to come up.

6. Wind-Solar Hybrid

The main objective of the National Wind-Solar Hybrid Policy is to provide a framework for promotion of large grid connected wind-solar PV hybrid system for optimal and efficient utilization of wind and solar resources, transmission infrastructure and land. The wind - solar PV hybrid systems will help in reducing the variability in renewable power generation and achieving better grid stability. The policy also aims to encourage new technologies, methods and way-outs involving combined operation of wind and solar PV plants. So far, SECI has awarded 1440 MW capacity of wind solar hybrid projects after e- reverse auction. In addition, Hero Future Energies has commissioned wind solar hybrid project by adding 28.8 MW of solar project to an existing 50 MW wind project (Total 78.8 MW hybrid project) in Raichur district, Karnataka.

7. Offshore Wind Power in India

The National Offshore wind energy policy was notified in October 2015 with an objective to develop the offshore wind energy in the Indian Exclusive Economic Zone (EEZ) along the Indian coastline of 7600 km. eight zones are identified each in Gujarat and Tamil Nadu having cumulative offshore wind energy potential of 70 GW. Expression of Interest for first 1 GW offshore wind project was floated in

April 2018. More than 35 participants from in country onshore wind developer / manufacturer as well as international offshore wind developers had participated. The inputs received from the participants have been duly considered in designing the bid documents.

8. Inter State Transmission System (ISTS) Phase-II (66.5 GW REZ)

Potential renewable energy zones (66.5 GW - Solar 50 GW and Wind 16.5 GW) have been identified in the states of Tamil Nadu, Andhra Pradesh, Karnataka, Gujarat, Maharashtra, Rajasthan & Madhya Pradesh and a comprehensive transmission scheme was evolved integrating these renewable energy zones.

The scheme is being implemented in phases by way of either Tariff Based Competitive Bidding (TBCB) or through Regulated Tariff Mechanism (RTM) by PGCIL. The TBCB bids are being carried out by PFC and REC. The allotment of works in TBCB or RTM is done by established committees of transmission constituted by Ministry of Power.

Of this, Phase-I projects (for evacuation of 12.4 GW) have been bid out, awarded and are under implementation. Phase-II projects (for evacuation of approx. 15 GW) have been allotted by Ministry of Power in October/November 2019 and the bids have been issued by PGCIL/PFC. The Phase-III (approx. 39 GW) projects are under approval of the National Committee on Transmission.

9. Payment Comfort

Opening of LCs by all DISCOMs/ distribution licensees for all producers

Ministry of Power has issued an order regarding opening and maintaining of adequate Letter of Credit (LC) as Payment Security Mechanism (PSM) under Power Purchase Agreements (PPAs) by Distribution Licensees (DISCOMs).

Further, Ministry of Power has instructed Power System Operation Corporation Ltd. (POSOCO) that according to the Procedure for Scheduling of power to Distribution Company, Power will be scheduled for dispatch only after a written intimation is given to the appropriate Load Despatch Centre (LDC) i.e. NLDC/RLDC/SLDC that Letter of Credit (LC) for the desired quantum of power w.r.t the generating stations has been opened.

Term loans to DISCOMs for clearing outstanding payments of RE generators

Ministry has requested PFC/REC/IREDA to extend short term loan to DISCOMs for the purpose of making payments to renewable energy generators.

10. Energy Storage

SECI have floated two tenders which include battery storage systems: -

1. 1200 MW tender with requirement of supplying power during evening/morning (six hours) peak, with battery storage system.

2. 400 MW round the clock renewable, this will also come with battery storage system.

11. Second Assembly of the International Solar Alliance (ISA)

The Ministry hosted the second assembly of International Solar Alliance (ISA) on 30th and 31st October 2019 New Delhi. On 30th October 2019, coordination and consultation meetings on different aspects of ISA programmes and initiatives were held.

The Assembly met on 31st October 2019 & was presided by Shri R.K. Singh, Hon'ble Minister & ex-Officio President of ISA. Delegations from 78 countries participated in the Assembly including 29 Ministerial delegations of which 25 are from ISA member countries, two from signatory countries, and two from prospective member countries. The Assembly deliberated upon ISA's activities and new proposals for accelerating development and deployment of solar energy in ISA member countries and approved Rules and Procedure of the Assembly, Manual of Regulations of ISA, and Work Programme and Budget for the year 2020.

12. Global Solar Event for commemorating 150th birth anniversary of Mahatma Gandhi

Ministry in association with IIT Bombay organised Global Student Solar Assembly to commemorate 150th Birth Anniversary of Mahatma Gandhi and to promote the Gandhian idea of sustainable living. Over 6,800 students from National Capital Region created Guinnes world record by lighting the largest number of solar lamps together at Indira Gandhi Stadium Complex, New Delhi. Another Guinness World Records was made during this event on sustainability lessons to the largest number of participants at a single place.

13. Dispute Resolution Mechanism

During the period MNRE set up a Dispute Resolution Mechanism for wind/solar projects to consider the unforeseen disputes between solar/wind power developers and SECI/NTPC, beyond contractual agreement. This mechanism will help in smooth implementation of solar/wind energy projects in India, by expeditiously resolving, unforeseen disputes that may arise beyond the scope of Contractual Agreements.

14. Off-Grid Solar PV Applications Programme Phase III

Government is implementing Phase-3 of the Off-Grid Solar PV Applications Programme for Solar Street Lights, Solar Study Lamps and Solar Power Packs. Based on the demand for solar streetlights and solar study lamps sanction has been issued to States; EESL has completed centralised tendering for solar streetlights and solar study lamps.

Provision has been made for financial supportup to 90 per cent of the benchmark cost of the system for NE States, Hilly States/UTs and Island UTs; up to 30 per cent of the benchmark cost of the system for other States. Solar study lamps for students will be provided in NE States and LWE affected areas with 85 per cent financial support from Central Government.

Targets: 118 MW of off-grid solar power systems during 2018-20.

Implementing framework: Projects will be implemented by State Nodal Agencies in their respective States. Centralised tendering will be done for solar streetlights and solar study lamps.

15. Atal Jyoti Yojana (AJAY) Phase-II

Applications covered: Solar Street Lights.

Financial support: 75 per cent of the cost by MNRE and balance 25 per cent through MPLAD.

Targets: A total of 3,04,500 Solar Street Lights (SSLs) will be installed in the following states/ regions:

I. States of Uttar Pradesh, Bihar, Jharkhand, Odisha and Assam, which were covered in Phase-I of the Scheme as there is additional demand in these States.

II. Hilly States/UTs of Jammu & Kashmir, Himachal Pradesh and Uttarakhand.

III. North Eastern States including Sikkim.

IV. Islands of Andaman & Nicobar and Lakshadweep.

V. Parliamentary constituencies covering 48 aspirational districts of States other than those covered in (i) to (iii) above.

Implementing framework: Project is proposed to be implemented by EESL. Hon'ble MPs of concerning parliamentary constituencies will provide consent letter along with location of lights. Respective DM will issue sanction for allocation of funds from MPLAD funds.

Achievements: During Phase I of the Scheme, sanction for allocation of funds from MPLAD fund received for 96 parliamentary constituencies. Out of sanctioned 1.45 lakh Solar Street Lights 1.34 lakh have been installed.

Current Status: Ph-II of the Scheme is under implementation. Consent letters for installation of 1,31,586 SSLs have been received from 120 Hon’ble MPs against which sanction from DMs has been received for 31,426 numbers of SSLs and 13,583 SSLS have been reported installed.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.