A Multi Stakeholder Perspective 1
Agenda Wind Vision Initiative Setting up of Wind Vision : 200 GW by 2032 Recommendations Wind Project Development Regulatory Incentives Financing Wind Vision 2032 Grid Integration of Wind Energy in India Wind Solar Hybrids, Small Wind Turbines Repowering Actions to Scale up Market to 200 GW by 2032 2
Wind Vision Initiative 3
Key Drivers of Wind Power in India 1/3 Energy Security Concerns Energy Access Key Drivers of Wind Power Climate Change Eco-System Readiness Cost Competitiveness 4
Key Drivers of Wind Power in India 2/3 Energy Security: India ranks 4 th and 6 th globally as the largest importer of oil, and of petroleum products and LNG, respectively Oil import bill: USD 64 billion in FY2016 (19.6% of Gross Imports) India s Oil imports dependency is 81% of total consumption Climate Change: India targets to reduce the emissions intensity of its Gross Domestic Product (GDP) by 33% 35% by 2030 This would require generating 40% of the electricity through non-fossil fuel sources including Wind Increasing Cost Competitiveness: Wind Energy is moving towards Grid Parity INR 4.16 4.82 per unit of Wind Energy as compared to fossil fuel-based generation of INR 4 5 per unit 5
Key Drivers of Wind Power in India 3/3 Eco-System Readiness: Manufacturing capacity already exists FIT Policy regime is in place Capital cost* (1.08 USDm/MW) among the lowest in the world [as compared to Germany: 1.36 MnUSD/MW, China: 1.60 MnUSD/MW, USA: 1.83 MnUSD/MW] Poor Energy Access: At 620 kgoe, India s per capita energy consumption is one of the lowest in the world (1,807-China, 1,361-Brazil & 4,927- Russia) Per Capital Electricity consumption is lowest among BRICS (Brazil 2.5 times; Russia 6.5 times, China 3 times; South Africa 4 times) Significant population still without access to electricity India has wind energy resources in abundance, can be tapped & used locally *World Energy Perspective from WEC 6
Setting of Wind Vision Target Define Target Year Identify Electricity Requirement per annum based on 18 th EPS of India Develop RE contribution trajectory based on NAPCC Targets Identify Wind Generation Requirement Calculate Equivalent Capacity based on Generation Requirement and set it as a Target 7
Deriving Wind Vision Target Particulars 12th FYP 13th FYP 14th FYP 15th FYP (FY 2016-17) (FY 2021-22) (FY 2026-27) (FY 2031-32) Projected electricity requirement per annum (@ power station bus bars) based on 18th EPS (billion units) 1,355 1,905 2,710 3,710 RE contribution based on NAPCC targets (%) 12% 17% 22% 27% RE generation requirement (billion units) 163 324 596 1,002 Wind generation requirement in billion units (BUs) (assuming 40% of total RE requirement) Cumulative wind installed capacity required in GW (assuming average capacity utilisation factor [CUF] of 23%) 65 130 238 401 199 32 64 118 (approx. 200 GW) 1. Contribution of Renewable Energy is projected to be in the range of 27% by 2032 2. It is important that Wind Sector should contribute significantly 8
Segment wise Targets (All figures in Giga Watt) 12th FYP (FY 2016-17) 13th FYP (FY 2021-22) 14th FYP (FY 2026-27) 15th FYP (FY 2031-32) Wind Vision Target 32 64 118 200 Offshore Wind (10% of Wind Vision) 6 12 20 Small Wind 0.10 Repowering 1 4 9 20 Onshore Capacity 31 54 97 160 Address both current and future issues Scale up the annual capacity addition from present 3 GW to 12-15 GW 9
Wind Capacity: Business as Usual Vs. Wind Vision 2032 Wind Capacity, GW 250 200 150 100 50 Wind Capacity: Business as Usual Vs. Wind Vision 2032 116 88 90 75 59.97 144 Wind Vision 2032 105 172 120 Business as Usual 200 135 - Important to identify changes in Policies, Regulations, Business Models, Structures, to scale up the annual capacity addition from present 3 GW to 12-15 GW In order to scale up capacity addition, new business models need to be explored for: Reducing Wind Power Costs - Cost improvements and advancements in Technologies Deploying wind in such a way that it is no longer considered as a variable source. Eg. Battery Storage and better scheduling and forecasting system Long Term Sustainable Development- Consistency and long term vision in policies 10
Potential Benefits of Wind Capacity Scale-up Emission Reduction Potential Considering emission factor (0.79 tco2/mwh), GHG emission reduction over useful life works out to 6158 Million tons of CO 2 equivalent by FY 2031-32 This translates to about 2.5 times of todays annual GHG emissions Job Creation Potential Estimation based on average direct long term job creation of 4 persons/mw as per MNRE HRD report Total job creation potential is estimated to be 8.7 lakh till FY 2031-32 This translates to an approx. 48k annual job creation potential Import Bill Reduction Potential Landed cost of imported coal -Rs 6000/ton with GCV of 5,500kCal/kg and Heat rate of 2,172 kcal/kwh as per CERC Cumulative import bill reduction potential over the useful life of wind projects is estimated at around Rs 18.4 lakh crore 11
Recommendations on various issues 12
Wind Project Development Recommendations Segregation of Siting and WRA from Rest of Project Development Activities Wind Resource Assessment Land Acquisition Permissions/ Clearances Infrastructure- Power Evacuation and Roads Site Identification Site Development Manufacturers, IPPs, PSUs and WRA entities would be at par (Level playing field for all) Multiple project development initiatives in parallel increase project pipeline, share business risks, reduce timelines SNA to be responsible for WRA, DPR quality and land matters Power evacuation to be planned at high voltage on MW/GW scale Confidence to the Project Developers/Investors 13
Mega Wind Projects Recommendations Significant investment required to achieve ~12 to 15 GW/annum. Private capital may not be able to bear such a huge risk Government involvement will be critical for risk mitigation if not as a direct investor Solar Park concept need to be introduced in Wind Sector Govt. should take up GW scale wind park development till clearance stage for multiple developers with well defined selection criteria Involvement of private investors for WRA as a separate activity Government could offer either entire Mega Wind Project or parts through bidding route to developers 14
Regulatory Support Instruments Recommendations Support should be continued till 2022 to restart wind economy FIT / Preferential Tariff/ GBI Consistent increase in RPO Strong compliance Regime Concessions to RE Open Access Transactions Regulatory Incentives Renewable Purchase Obligation Energy based charges instead of capacity based charges CERC tariff for initial inter-state transactions RE Certificate Mechanism APPC+REC mechanism for competitive procurement 15
Financing Wind Vision 2032 Recommendations Investment required to achieve the target is INR 17.08 lakh crore by FY 2031-32, translates to INR 1.07 lakh crore per annum from FY 2016-17 Developing a longer term bond market - New products to be introduced, appetite of long-term investors need to be increased Development of refinancing market, under which an apex refinancing body to be established for better governance of market RBI to modify its asset classification norms to bring more consistency and similarity in NPA definition for bank and NBFC RBI to promote foreign currency long term deposits in banks from NRIs and foreigners Introduction of New Financing Structures, primarily Yieldcos & REITs 16
Grid Integration of Wind in India Recommendations Challenges Planning: Lack of integrated generation & transmission planning considering RE Ageing and inadequate transmission corridors Construction: No uniform grid interconnection process Funds for transmission infra. Development Right of Way (RoW) issues and local challenges Operation: Issues pertaining to forecasting and scheduling Fault ride through capabilities of WTGs Reactive power issues Solutions Adopt Integrated Transmission- Generation-Load Planning Amendments to Planning Codes of the State Grid Codes Active participation of all stakeholders including wind generators in grid coordination committee Development of standard interconnection process for RE Exploring PPP model or Independent Private Transmission Company (IPTC) model for RE Tx Schemes Prioritize infrastructure projects for RE Establishing visibility and communication links between wind farm pooling stations and SLDCs. Establishment of REMCs Development of balancing frameworks at state and regional level. 17
Forecasting and Scheduling Recommendations Need for visibility: Additional IT infrastructure to be established for visibility of pooling stations Robust communication facility: Need for establishing communication facility for tracking real-time generation of pooling station at SLDC Who would install? Who would bear the cost for establishing the communication network Need for uniform settlement mechanism: Different practices for generator payment exist in different States. Institutional Set up and deviation Settlement mechanism. Implementation Roadmap 100% metering at Pooling station level Establishing telemetry b/w SLDCs & pooling SS Appointment of QCAs at pooling station level Amendment of State Grid Codes 18
Wind-Solar Hybrids Recommendations Introduction of RE Hybrid Policy at National level Funding support/fiscal benefits for Wind-Solar Hybrid Projects Amendments in Metering, Energy Accounting and other procedures Preference in State/Central Transmission Utility and Evacuation planning Separate measurement of wind and solar generation and separate treatment in respective RPOs Modification in RPO and Renewable Energy Certificate (REC) Regulations for RE Hybrid Projects 19
Small Wind Turbine (SWT) Recommendations In-depth assessment of the market for small wind power/solar-wind hybrid systems (both off-grid & grid connected) R&D Support to identify and commercialize technologies suitable for Indian environment With dropping storage prices, SWTs are expected to become financially viable Regulatory support for connecting small wind turbines to grid through net/gross metering is required FIT/ GBI for gross generation from SWT, irrespective of location of small wind turbine 20
Repowering of old WTGs Recommendations Government should initiate the continuous repowering program. For permitting re-powering, existing project should have maximum balance life of 10 years and wind turbine capacity of each WTG < 1 MW All captive, third party sale and sale to State Discom projects to be considered for re-powering, MoP Rules for Captive Generating Station should be relaxed in case of repowering as more than 60% of old WTGs are in captive mode Micro-siting criterion may be relaxed in case of repowering project Appropriate re-powering ratio to ensure more energy yield Generation linked re-powering incentive for period uptp 10 years 21
Actions to Scale up the Market to 200 GW by 2022 22
Actions to Scale Up the Market to 200 GW by 2032 Themes Short Term Medium Term Long Term Primary Responsibility Regulatory, Policy & Tax Incentives REC as Statutory Instrument FiT/GBI & RE Law Govt. of India Financing Wind Sector Low Cost Increase Limit YieldCos and Funding of ECB REITs Govt. of India Wind Power Project Development Nationwide Wind Resource Assessment Study Project Identification Model Mega Wind/ Hybrid Parks SNA/ MNRE Procurement of Wind Power Strict RPO Compliance Promoting Inter- State Sale of Wind Power Developing Competitive Bidding Framework CERC/ SERC/ MNRE Grid Integration of Wind Energy Green Corridor to Include Higher Targets Creating of RE Transmission Planning Authority Development of Ancillary Markets CTU/CEA 23
Thank You 24