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saurabh

India Extends Exemption Of Transmission Charge For Solar Power Projects

written by saurabh

In a bid to push solar power tariffs even lower and incentivising as many states as possible to procure electricity from large-scale solar power projects through long-term agreements, the Indian government has extended a crucial incentive linked to inter-state transmission of electricity.

The Ministry of New & Renewable Energy recently announced that solar power projects commissioned by 31 December 2019 will be exempt from paying inter-state transmission charge. The initial deadline to avail this exemption was 30 June 2017.

The exemption is critical for states planning to procure electricity from projects located in others. Several companies are also looking to procure electricity from solar power parks.

The lowest solar power tariff in India currently stands at Rs 2.44/kWh which is cheaper than 92% of the operational coal-based power plants in the country. Apart from the falling module prices, aggressive targets and regulatory measures such as this exemption have played a major role in the steep fall in tariff bids.

The Delhi Metro Rail Corporation (DMRC) has signed a 25-year power purchase agreement with Rewa solar power park located 800 kilometres away. Similarly, Noida Metro and Coal India are also planning to set up solar power parks in Madhya Pradesh. Recently, Uttar Pradesh proposed to set up a 750 megawatt solar park in neighbouring state of Rajasthan.

The extension will also compliment the Green Energy Corridors project undertaken by the Power Grid Corporation of India to facilitate easy transmission of electricity generated from renewable energy projects across India.

06/21/2017 0 comment

Renewable Energy

Indian Railways To Install Solar Panels Atop 250 Trains

written by saurabh

The Indian Railways is going all out to reduce its fuel costs and adopt solar power in a major way. Apart from planning large-scale solar power projects and rooftop solar power systems, the world’s fourth-largest railway network is planning to install solar panels on top of coaches.

The Indian Railways has floated a tender for installation of solar panels atop 250 trains to power fans and lighting systems. The tender, according to media reports, would require winning companies to install battery systems in addition to solar panels.

Companies selected through the tender process will be required to install flexible solar panels and battery systems on six trains on experimental basis. These trains will be put into commercial operations and performance of the panels and batteries would be tested for a period of two months before a decision on large-scale implementation is taken.

The Indian Railways, through the mandate of the central government and its own target to shift to clean energy sources in the long-term, has taken numerous initiatives in the recent past. A study by the United Nations Development Program stated that the Indian Railways could source as much as 25% of its energy needs from renewable energy sources by 2025.

The Council on Energy, Environment and Water (CEEW) has found that Indian Railways could set up 5 gigawatts of solar power capacity, through rooftop and utility-scale projects, to significantly increase its consumption of renewable energy over the next few years.

The study by CEEW shows that 3,900 megawatts of utility-scale projects and 1,100 megawatts of rooftop projects can be installed by the Indian Railways with an estimated investment of $3.6 billion. Last year, the Indian Railways joined hands with UNDP to execute plans to set up 5,000 megawatts of solar power capacity.

Earlier this year, the Indian government announced a major push by the Indian Railways in the rooftop solar power market, perhaps the largest in India and the world!

The Indian Finance Minister Arun Jaitley announced that the 7,000 railway stations across the country will be fed with solar power as per the Indian Railways mission to implement 1,000 megawatts of solar power capacity. The minister made the announcement during the union budget speech on 1 February 2017.

The minister stated that work to set up rooftop solar power systems at 300 stations has already started, and soon this number will increase to 2,000 stations. According to data released by the Minister of Railways, India had 7,137 railway stations at the end of March 2015.

In the large-scale solar power market, the Indian Railways is looking to adopt the model used by the Delhi Metro Rail Corporation (DMRC), India’s largest subway system. DMRC has signed a power purchase agreement of around 200 megawatts with Rewa Solar Power Park located about 800 kilometres.

The Indian Railways has approached the government of Madhya Pradesh with a proposal to set up a mega solar power park with a capacity of 700-800 megawatts (MW). The project will come up at Shajapur, a few hundred kilometres east of the Rewa solar power park which received the lowest-ever tariff bid ever in India.

06/18/2017 0 comment

Renewable Energy

450 Megawatt Capacity Commissioned At 1 Gigawatt Kurnool Solar Park In India

written by saurabh

A large-scale solar power park in southern India is slowly reaching its planned capacity of 1 gigawatts as more and more developers commission their projects.

The Kurnool solar power park owned by NTPC Limited, India’s largest power generating company, has reached an installed capacity of 450 megawatts following operationalisation of two projects. Two more projects and the solar park will reach the milestone of 1 gigawatts to become one of, if not the largest, solar power park in the world.

SB Energy, a joint venture company of Softbank, Foxconn Technology and Bharti Enterprises, had commissioned a 350 megawatt (AC) project in late March 2017 while Azure Power recently commissioned 100 megawatt (AC) project in early June 2017. All projects commissioned at the solar power park will supply electricity to state-owned utilities of Andhra Pradesh where the park is located.

Both, Azure Power and SB Energy secured rights to develop their projects under the ‘open’ category which means that they were free to use Indian or imported solar panels. While the origin of panels used by Azure Power is unknown, SB Energy used more than 700,000 panels manufactured by China-based Trina Solar.

The other two developers – Greenko Energy and Adani Green Energy – won their projects under the Domestic Content Requirement (DCR) category and are obligated to use Indian-made panels. Greenko is developing a 500 megawatts (AC) project at the park which, once commissioned, will likely become the second largest solar power project developed by a single developer at a single site in India.

Adani Green Energy, which currently operates the largest solar power project in India, will commissioned 50 megawatts (AC) project at the Kurnool solar power park.

06/18/2017 0 comment

Renewable Energy

World’s Largest Coal Miner To Shut 37 Loss-making Mines In India

written by saurabh

Coal India, the largest coal producing company in the world, recently announced plans to shutdown some mines that are no longer economically viable.

Government-owned Coal India recently informed the Bombay Stock Exchange that it will shut 37 underground mines as it is financially unviable to continue mining coal from them. The company plans to shut these mines by March 2018.

These mines comprise of about 9% of the total mines operational under Coal India. Media reports quoting industry sources stated that the company is expected to realise savings of Rs 800 crore ($124 million).

Coal India’s provisional production in 2016-17 was 554.13 million tonnes against a target of 598.61 million tonnes and recording a growth rate of 2.9 per cent. Of this underground mining contributed to around 31 million tonnes.

While underground mines have their own set of constraints and hurdles which significantly increase the cost of production, increased competition from renewable energy technologies, where fuel cost is nil, could also be a contributing factor.

Increased Competition From Renewable Energy

Earlier this year, solar power tariffs in India fell 26% over a period of 3 months as project developers placed extremely competitive bids for large-scale projects. The current lowest solar power tariff in India stands at Rs 2.44/kWh (3.8¢/kWh).

Wind energy tariffs in the first-ever auction organised by the Ministry of New & Renewable Energy were also substantially lower than the feed-in tariffs enforced by various states. The current lowest wind energy tariff bid in India is Rs 3.46/kWh (5.4¢/kWh) and is expected to fall further as 5-6 gigawatts wind energy capacity is planned to be auctioned every year till 2022.

Recent reports also stated that almost 14 gigawatts of planned coal-based power plants were shelved in India over financial viability concerns.

Renewable energy capacity addition, too, increased at a much faster rate in FY2016-17 compared to coal-based power plants.

A total of 6,990 megawatts of coal-based power capacity was added in India in FY2016-17 while the thermal power capacity addition during the financial year stood at 7,655 megawatts. In comparison, 14,140 megawatts of renewable energy capacity was added in the same period.

Coal India itself is planning to set up large-scale solar power projects. The company is expected to set up at least 1 gigawatts solar power capacity in the near future.

06/18/2017 0 comment

Renewable Energy

Trina Modules Now Generating Power At India’s 2nd Largest Solar Power Project

written by saurabh

Trina Solar recently issued a press release boasting of the fact that its solar modules have started feeding electricity to the grid in India from a large-scale project of SB Energy, a joint venture company of Softbank, Foxconn Technology and Bharti Enterprises.

The project, with a capacity of 455 megawatts (DC), is perhaps the second largest solar power plant developed by a single company in India. The largest operational project being the 648 megawatts power plant in Tamil Nadu owned by Adani Green Energy. The SB Energy power plant is part of the 1 gigawatt NTPC solar power park at Kurnool.

Trina announced that it shipped more than 700,000 TALLMAX 72-cell polycrystalline panels to the project which was commissioned on 29 March 2017 and recently started commercial operations. As mentioned in earlier articles,

SB Energy was the sole winner of the 350 megawatts (AC) solar power tender launched by India’s largest power generation company NTPC Limited for a solar power park in Kurnool district of Andhra Pradesh. The auction took place in December 2015 and was awarded to SB Energy at a tariff of Rs 4.63/kWh (7.12¢/kWh), the lowest in India at that time.

SunEdison also secured rights to develop a 500 megawatts (AC) project at the solar power park through in a separate auction. Once commissioned, the project will overtake SB Energy as the operator of India’s second-largest solar power project.

SB Energy is among the leading solar power developers in India and remains at the forefront of the sharp decline in solar power tariffs. Last month,

… the company secured rights to develop 100 megawatts capacity out of the 250 megawatts offered by Adani Enterprises at the Bhadla solar power park. The capacity was allocated at Rs 2.63/kWh (4.1¢/kWh), one of the lowest tariffs in India at the time. Two days later, the company also won 300 megawatts capacity offered by IL&FS, an infrastructure company, at the same solar power park at Rs 2.45/kWh (3.8¢/kWh) another record low in India.

06/18/2017 0 comment

Renewable Energy

Indian Renewable Energy Development Agency Set To Launch IPO

written by saurabh

The Indian government is looking to tap market opportunities to keep up the recent swift growth in the renewable energy sector.

The cabinet recently approved a decision to launch an Initial Public Offer for the Indian Renewable Energy Agency (IREDA). The agency is among the leasing lenders to renewable energy projects across India. It also administers the one of most important incentives available to the renewable energy market in India – generation-based incentive.

Funds raised from this exercise would likely be used to increase debt finance to renewable energy projects. IREDA recently announced that it will sanction loans worth Rs 13,000 crore ($2 billion) to renewable energy projects in FY2017-18.

By sanctioning this amount, IREDA will likely capture a fifth of the debt finance market for renewable energy projects in FY2017-18. Of the sanctioned amount, more than 60% will be disbursed within the financial year. The agency has already sanctioned a cumulative of Rs 37,000 crore ($5.66 billion) and has disbursed a total of Rs 28,000 crore ($4.28 billion). This translates into debt finance for 7,000 megawatts of capacity.

Loan sanctions by IREDA have grown from Rs 826 crore ($126 million) in 2007-08 to Rs 7,806 crore ($1.2 billion) in 2015-16 and is expected to cross Rs 10,000 crore ($1.5 billion) in the current financial year, 2016-17. Loan disbursements have also increased from Rs 553 crore ($81.5 million) in 2007-08 to Rs 4,257 crore ($651 million) and is expected to cross Rs 6,000 crore ($917 million) in 2016-17.

The move seems directed towards attracting more investors to the Indian renewable energy market. Over the last few months several foreign investors and project developers have entered India looking to capture a share in one of the world’s fastest growing renewable energy markets. The move will also likely strengthen the investor confidence and prepare the market for the next big move which has seen sharp reduction in tariffs in a very short period of time.

The Indian government has set very ambitious targets of 100 gigawatts solar and 60 gigawatts wind energy capacity operational by March 2022. To meet such huge targets the government has been looking at new and innovative methods of raising capital. Several public sector companies, including IREDA, have been directed to raise funds through green bonds. The government is also planning an equity fund directed at renewable energy projects to attract funding from large foreign investors.

With the recent boom in India’s renewable energy market and several large-scale companies setting up subsidiaries to take advantage of that boom, it is highly likely that more renewable energy companies would look at stock markets to raise funds.

ReNew Power Ventures Limited is believed to planning an IPO later this year. Renewable energy subsidiaries of listed companies including Adani Green Energy, Tata Power Solar and Hero Future Energies may also look at this route.

06/18/2017 0 comment

Renewable Energy

800 Megawatts Solar Project In Dubai Achieves Financial Closure

written by saurabh

The third phase of Mohammed bin Rashid Al Maktoum Solar Park in Dubai has achieved financial closure marking a major milestone for one of the largest solar power projects and solar power parks in the world.

Construction at the 800 megawatt project being developed by the Masdar Group and EDF Energies Nouvelles began in January 2017 and is expected to be operational in 2020. Debt funding for the project came from seven different financial institutions, including the Islamic Development Bank and the Arab Petroleum Investments Corporation, Korea Development Bank and Export Development Canada.

The presence of these funding institutions points towards very low interest rate. A low interest rate is exactly what the project developers require as it is also among the cheapest solar power projects in the world.

The phase III tender set a record for lowest-ever solar PV tariff globally at that time. The Masdar-led consortium beat the phase II winning bid of 5.84¢/kWh with a bid of 2.99¢/kWh. Masdar Group and DEWA signed the power purchase agreement for the project in November 2016.

Recently, Canadian Solar shipped 268 megawatts of solar modules for the project. The Mohammed bin Rashid Al Maktoum Solar Park has an operational capacity of 213 megawatts from the first two phases commissioned by First Solar and ACWA Power.

The solar power park will be the mainstay of Dubai’s clean energy policy.

The Mohammed bin Rashid Al Maktoum Solar Park will have an eventual capacity of 5 gigawatts. The initial planned capacity was 1 gigawatt which was subsequently increased to 3 gigawatts, and now 5 gigawatts. Bids of the first 1 gigawatt of capacity have already been awarded.

06/18/2017 0 comment

Renewable Energy

End Of Wind Energy Feed-in Tariffs In India?

written by saurabh

With the Indian government planning to organised an increasing number of reverse auctions for wind energy projects, several states are rethinking whether to continue with the feed-in tariffs at all.

Karnataka has become the latest state to ask its power utilities not to sign any new power purchase agreements with wind energy developers at feed-in tariffs. Regulatory bodies in Indian state have asked power utilities to procure wind energy only up to the renewable purchase obligation targets and no more.

The Karnataka Electricity Regulatory Commission had set the feed-in tariff for wind energy projects as Rs 4.50/kWh (7.0¢/kWh) till October 2018. However, the recent auction conducted by the central government saw developers willing to pay as low as Rs 3.46/kWh (5.4¢/kWh). According to media reports, the commission believes a tariff of Rs 3.61/kWh (5.6¢/kWh) is more acceptable.

States of Gujarat and Andhra Pradesh have declined to sign any fresh power purchase agreements with wind energy project developers. The power distribution companies in these states have expressed reluctance to the respective regulatory bodies in signing PPAs at feed-in tariffs higher than the recently discovered tariffs.

Four companies – Mytrah Energy, Green Infra (owned by Sembcorp), Inox Wind and Ostro Energy were awarded 250 megawatts capacity each while Adani Green Energy secured rights to develop 50 megawatts capacity.

India plans to have an installed wind energy capacity of 60 gigawatts by March 2022 while the current installed capacity is just over 32 gigawatts. To achieve that target, the Ministry of New & Renewable Energy shall auction five to six gigawatts capacity every year. One gigawatt capacity has already been auctioned while the Ministry is expected to put on the block an additional four gigawatts capacity by March 2018.

06/18/2017 0 comment

Renewable Energy

Canadian Solar Ships 268 Megawatts Solar Panels For Dubai Solar Park Phase III

written by saurabh

A Masdar-led consortium has selected Canadian Solar to supply modules for the phase III of the Mohammed bin Rashid Al Maktoum Solar Park in Dubai.

Canadian Solar recently announced that it will ship 268 megawatts of solar PV modules for the 800 megawatt phase III of Dubai solar power park being developed by Masdar-EDF consortium for the Dubai Electricity and Water Authority (DEWA). The company will supply more than 800,000 modules for the project which is expected to be commissioned in 2020.

In January this year Masdar announced that construction at the project has started. The solar park current has an operational capacity of 213 megawatts – 13 megawatts from phase I and 200 megawatts from phase II developed by ACWA Power.

The phase III project remains one of the cheapest solar power projects in the world.

A Masdar Group–led consortium was confirmed as the winner of the 800 MW solar power tender that was floated by the Dubai Electricity and Water Authority (DEWA) last year. The consortium includes Fotowatio Renewable Ventures and Gransolar Group.

The phase III tender set a record for lowest-ever solar PV tariff globally at that time. The Masdar-led consortium beat the phase II winning bid of 5.84¢/kWh with a bid of 2.99¢/kWh. Masdar Group and DEWA signed the power purchase agreement for the project in November 2016.

The Mohammed bin Rashid Al Maktoum Solar Park will have an eventual installed capacity of 5 gigawatts with the next phase of 1 gigawatt capacity.

05/31/2017 0 comment

Renewable Energy

French Energy Major Engie Plans At Least $1 Billion Solar Investment In India

written by saurabh

French energy company Engie has announced plans to invest ‘a minimum’ $1 billion in India as it looks to strengthen its share in the rapidly growing solar power market.

Chief executive officer at Engie Isabelle Kocher recently stated that the company is looking to secure at 400 megawatts solar power capacity every year with a planned investment of $1 billion over the next five years in India. Engie is present in India through a subsidiary – Solairedirect.

Solairedirect is among the leading foreign solar power project developers operating in India, and is also among the first movers, operating since the launch of the National Solar Mission in 2010. The company has been at the forefront of the recent sharp decline in solar tariff bids in India.

In January 2016, the company nearly tied for the lowest solar power tariff in India at that time. The company secured rights to develop 140 megawatts at the Bhadla solar power park in the state of Rajasthan; it placed a winning bid of Rs 4.35/kWh (6.7¢/kWh).

Solairedirect set another record recently in an auction for a solar power park being developed by India’s largest power generator NTPC Limited.

Solairedirect recently won rights to develop a 250-megawatt solar power project in the Kadapa solar power park being developed in the state of Andhra Pradesh. The company placed a winning bid of Rs 3.15/kWh (4.8¢/kWh), 4.5% lower than the previous record of Rs 3.30/kWh (5.1¢/kWh) levelized tariff set in February 2017.

Solairedirect currently owns only solar power projects in India but is looking to diversify into wind energy as well. Malcolm Wrigley, Engie’s India CEO stated that the company could participate in the upcoming wind energy auctions.

05/31/2017 0 comment

Renewable Energy

Soltec Grabs 238 Megawatt Solar Tracker Order In Mexico

written by saurabh

Spanish manufacturer of solar trackers Soltec has secured another major order in South America strengthening its position in the rapidly growing market.

Soltec recently announced that it will supply solar trackers for a 238 megawatts solar power project in Mexico. The Don José project is being constructed by Enel Green Power Mexico and is located in San Luis de la Paz, in the country’s North-Central state of Guanajuato.

Enel secured the rights to develop the project following an auction. The company shall supply electricity from the project under a long-term agreement of 15 years and will sell clean certificates for a period of 20 years.

Don José will have an installed capacity of 238 MW and once completed will be able to produce 539 GWh per year, equivalent to the annual energy consumption needs of around 410,000 Mexican households, while avoiding the emission of over 245,000 tonnes of CO2 into the atmosphere.

The solar tracker order is the second by Enel to Soltec in the last few months. Earlier this year, Soltec announced that it started installing trackers at 292 megawatt solar power project in Brazil. The project, also won through competitive auction, is being developed by Enel Green Power Brasil Participações.

Following the completion of Don José and the Brazilian 292 megawatt power project Soltec’s presence in South America would reach at least 688 megawatt.

05/31/2017 0 comment

Renewable Energy

India’s Largest Port Plans 200 Megawatt Solar-Wind Energy Park

written by saurabh

India’s largest port (by volume handled) could soon be powered by renewable energy, the Minister for Shipping and Transport Nitin Gadkari recently stated.

Government officials are assessing the possibility of setting up a solar-wind energy park to power the seaport of Kandla, located in the west Indian state of Gujarat. In addition to meeting its own power demand the port may also be able to sell renewable energy to other buyers.

Minister Gadkari stated that the solar-wind energy park could be commissioned over an area of 150,000 acres with the total installed capacity of around 200 megawatts; Gadkari did not share the likely split between solar and wind energy at the park.

Gadkari noted that the solar power tariffs have crashed in India over the last few months and the port could use the surplus land to develop large-scale renewable energy projects.

Since February this year four major solar power auctions have taken place in India with the lowest tariff bids falling by as much as 26% between the first and the latest auction. The race to lower tariff bids has been fuelled primarily by the crash in solar module prices, regulatory support from the government and, perhaps, the promise and hope of cheap debt finance.

Interestingly, this proposed renewable energy park will have a capacity greater than the entire planned capacity addition at all seaports in India.

The Ministry of Shipping had announced that under the ‘Green Port Initiative’ a total of 136.5 megawatts of renewable energy projects will be implemented at a dozen major ports in the country. These include 91.5 megawatts solar power and 45 megawatts wind energy projects.

The Indian government is pushing for public sector companies and institutions to set up renewable energy projects. Any public sector company with surplus land is being asked to set up large-scale solar and wind energy projects. Meanwhile, the Ministry for Civil Aviation has announced that 143 airports in the country will set up a cumulative of 148 megawatts solar power capacity.

05/31/2017 0 comment

Renewable Energy

Construction Begins At The Largest Solar Power Project In The Middle East

written by saurabh

Marubeni and JinkoSolar have initiated construction at the largest solar power in the Middle East. The 1.17 gigawatt solar power project will be located in Abu Dhabi and is one of the cheapest solar power projects in the world.

The joint venture of Marubeni and JinkoSolar secured the solar PV power project from Abu Dhabi Water and Electricity Authority (ADWEA) at a record-low tariff of 2.94¢/kWh. Once commissioned, the project will be one of the largest solar power projects in the world.

Marubeni and JinkoSolar will provide for 20% equity funding each while ADWEA shall arrange for debt funding. The debt to equity ratio for the power plant is unusual compared to global standards where debt usually consists of 70-80% of the total project cost. The project is expected to be commissioned in 2019.

Once commissioned, the Noor Abu Dhabi project will, briefly, compete with the Mohammed bin Rashid Al Maktoum Solar Park (Dubai solar power park). ACWA Power recently commissioned the 200 megawatt phase II of Dubai solar power park while a Masdar-led consortium has begun construction for 800 megawatt phase III of the project. The Dubai solar power park will eventually have an installed capacity of 5 gigawatts.

Abu Dhabi already hosts one of the largest concentrated solar power projects in Asia – the Shams 1.

Both the projects will form the backbone of United Arab Emirates’ move towards clean energy.

Through its submission to the United National Framework Convention on Climate Change (UNFCCC), the United Arab Emirates (UAE) announced its target to achieve 24% of low-carbon by 2021. The target is central to the Intended Nationally-Determined Contribution (INDC) …

The UAE Cabinet (…) endorsed the target to increase low-carbon energy contribution to the overall energy mix from 0.2% in 2014 to 24% in 2021. Low-carbon technologies would include renewable energy and nuclear power. This overall target would be distributed among the 7 Emirates, some of which (like Dubai) have already announced such targets.

05/28/2017 0 comment

Renewable Energy

SoftBank-backed SB Energy Justifies India’s Lowest Solar Power Tariffs

written by saurabh

SoftBank led SB Energy has stated that India’s lowest solar power tariffs are financially viable given the sharp fall in module prices and ample supply of debt finance for energy projects.

Manoj Kohli, executive chairman of SB Energy, recently stated that the company’s tariff bid of ₹2.45/kWh (3.8¢/kWh) for a 300 megawatt solar power project in Rajasthan is aggressive but financially viable. Kohli stated three major reasons for the sharp fall in tariff bids in India’s solar power market over the last few months.

Price of Chinese solar power modules have fallen significantly over the last few months has been a major reason for conjugated fall in tariff bids world over, Kohli said. Chinese exports have increased as the country’s domestic solar power program has slowed down.

Global banks have also increased exposure to renewable energy projects, Kohli added. Several of the cheapest solar power projects across the world have received debt funding at very low rates. These projects include the 200 megawatt phase II of Dubai solar power park and the 750 megawatt Rewa solar power park in Madhya Pradesh, India.

Kohli also stated another global trend in the solar power market. Larger projects are being auctioned and commissioned now than at any time in the history. This results in lower costs due to economics of scale.

The three reasons mentioned by Kohli are applicable to the global solar power market in general but there are India-specific reasons as well for the declining prices. Withdrawal of inter-state transmission charges, increased renewable energy installation and consumption targets and efforts to improve the financial health of power utilities have contributed significantly to the decline in solar tariff bids in India.

05/28/2017 0 comment

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