mnre
TRANSCRIPT
Renewable Energy Sources
PNBV Chalapathi Rao, Scientist B Solar Thermal Division
About MNRE The Ministry of New and Renewable Energy (MNRE) is the nodal Ministry of the Government of India for
all matters relating to New and Renewable Energy. The broad aim of the Ministry is to develop and deploy new and renewable energy for supplementing
the energy requirements of the country. Development of Ministry: 1981-Commission for Additional Sources of Energy (CASE) 1982-Department of Non-Conventional Energy Sources (DNES)
1992-Ministry of Non-Conventional Energy Sources (MNES) Ministry of New and Renewable Energy (MNRE) in 2006.
About MNRE The Mission of the Ministry is to ensure Energy Security: Lesser dependence on oil imports through development and deployment of alternate fuels and their
applications to contribute towards bridging the gap betweendomestic oil supply and demand; Increase in the share of clean power: Renewable electricity to supplement fossil fuel based electricity generation; Energy Availability and Access: Supplement energy needs of cooking, heating, motive power and captive generation in rural, urban, industrial and commercial sectors;
Energy Affordability: Cost-competitive, convenient, safe, andreliable new and renewable energy supply options; and Energy Equity: Per-capita energy consumption at par with the global average level by 2050, through a sustainable and diverse fuel- mix.
About MNRE Vision To develop new and renewable energy technologies, processes, materials, components, sub-systems, products & services at par with international specifications, standards and performance parameters
in order to make the country a net foreign exchangeearner in the sector and deploy such indigenously developed and/or manufactured products and services
in furtherance of the national goal of energy security.
Power Installation Capacity in India (As on 31-10-11)Source Thermal Hydro (>25MW) RE Nuclear Captive Total Capacity (MW) % 119041 59% 38706 20162 4780 19509 2,02,198 19% 10% 2% 10%2% 10%
Total Capacity = 2,01,066 MW10% Thermal Hydro (>25MW) RE 19% 59% Nuclear Captive
Per Capita Annual Electricity Consumption in the WorldCountry Canada USA Australia Japan France Germany Year 2008 17053 13647 11174 8072 7703 7148
KoreaUK Russia Italy
88536067 6443 5656
South AfricaBrazil China India World
47702232 2471 734 2782
Per Capita Annual Electricity Consumption in India
Power Generation Costs in India by (2006)
Renewable Energy Certificate (REC) Mechanism
National Load despatch Centre (NLDC) is theCentral Agency for registration 1 REC = 1 MWhr
Renewable Energy Certificate (REC) Mechanism Broad categories solar certificates Generation of electricity based on solar energy (SPV/ST)
non-solar certificates Generation of electricity based on other Renewable Energy
sources, like Wind, Bio, Hydel etc
CERC has determined the price for trading
Renewable Energy Certificate (REC) Mechanism RECs will be issued to RE generators and valid for 365 days from the date of issuance RECs will be purchased by obligated entities
to meet their respective RPOs
Existing Power Purchase Agreement RE
generators on preferential tariff are noteligible for REC mechanism
Renewable purchase Obligation (RPO)
Renewable purchase Obligation (RPO)
Renewable Energy potential in India
Renewable Energy Achievement in India (Up to 31/08/2011)Source Wind Power Small Hydro Power (1kW) Total (MWEq) -Urban -Industrial 25 200 3435 2400 350 460 833.00 111.30 86.50 111.50 1.20 8.50 1152.00 10.18 31.99 1.20 4.50 0.12 3.50 51.49 14989.00 3153.93 1083.60 1779.03 20.20 53.46 46.16 21125.38 3.50 72.30 327.95 15.55 125.88 1.24 72.50 618.92 Target for 2011-12 Achievement during 2011-12 Cumulative up to 31.08.2011
15.00 80.00 3.00 10.00 0.50 20.00 128.50
Solar Energy
Solar Radiation Recourses
Solar Power Potential
Solar map of world
India has 500-900 w/m^2
Pune to Bangalore belt has 700 to 800w/m^2 Coastal India has poor radiation has 600 w/m^2 Australia has highest solar irradiation has 1000 w/m^2
SOLAR ENERGY Is it Renewable?
Sun burns 5 million tons of Hydrogen/sec
by fusion
It will burn for another 4.5 billion years
It will deplete in 4.5 billion yearsStrictly after 4.5 billion years, it is not renewable, but nobody knows
Solar Terminology Beam Radiation or Direct Radiation (Ib): Solar radiation received at earth surface without change of direction and in line with sun
Diffuse Radiation (Id): Solar radiation received at earth surface from all parts of skys hemispheres.
Global Radiation (IG): It is the sum of beam radiation and diffuse radiation. IG= Ib + Id
Solar Irradiance or Insolation (w/m2): The rate at which solar energy reaches a unit area at the earth. It is instantaneous measure of rate and vary over time.
Solar Energy Technologies Solar Energy is the ultraviolet radiations from sun Can be Converted into either Heat orElectricity
Broad categories Solar Photovoltaic (SPV) Power generation
Solar thermal (ST) Heating Power generation
SRRA Stations across India
SRRA Station
Solar Radiation Monitoring StationSl. No. 1 Parameter Global Radiation Instrument Pyranometer*
23
Diffused RadiationDirect Normal Incidence (DNI)
Pyranometer with Shade*Pyrheliometer*
45 6
Ambient TemperatureAtmospheric Pressure Wind Speed & direction
RH/T SensorBarometer Ultrasonic Wind Sensor
78
Rainfall
Tripping Bucket Rain Gauge
Aerosol Measurements** To be decided
*Installed on Solar Tracker **to be installed at 5 sites only
Solar Radiation Monitoring StationSl. No. Parameter Instrument
9 10
Data Logging Accessories :Real time data Network Installation of Met Sensors Power
Data logger with IP-67 EnclosureGPRS built in modem in the data logger 6 meter triangular mast Solar Panel Array and battery storage
Installation of Solar Tracker 1.5 meter Mast
Time & Sun Synchronization External GPS
SRRA SitesSl. No. 1 2 3 4 5 6 7 8 9 10 11 States No. of stations Andhra Pradesh 06 Chhattisgarh 01 Gujarat 11 Haryana 01 Jammu & Kashmir 01 Karnataka 05 Maharashtra 03 Madhya Pradesh 03 Pondicherry 01 Rajasthan 12 Tamil Nadu 07 Total 51
Solar Thermal Technologies Sub categorized based on the heat O/P Low temperature (upto 600C) Water heating and other low grade applications Flat plate collectors
Medium temperature (upto 1500C) Steam generation, Air drying Flat plate, concentrators (disc)
High temperature (upto 3000C) Mostly for power generation Parabolic trough, Compact Linear Fresnel Reflector (CLFR), Parabolic dishes, Solar power tower
Solar Thermal Low and Medium Temperatures Technologies Solar Water Heating Systems
Solar Thermal High Temperature Technologies Power generation technologies can be classified as follows Standalone solar technology Solar thermal or solar PV
Hybridization Solar + gas / coal / oil / any other fuel
Storage Solar + Thermal Storage
All combinations - Solar + Fuel + Storage
Solar Thermal Technologies Parabolic trough It is the most widely deployed and proven type of solar thermal power technology A parabolic trough consists of a linear parabolic reflector that concentrates light
onto a receiver positioned along thereflector's focal line The receiver is a tube positioned directly
above the middle of the parabolic mirrorand is filled with a with working fluid
Solar Thermal Technologies
Solar Thermal Technologies Parabolic trough The reflector follows the Sun during the daylight hours by tracking along a single axis. A working fluid is heated upto 150350 C and is then used as a heat source for a power generation system
World figures Under operational Under construction = = 1143 MW 1375 MW
Solar Thermal Technologies Solar power tower Consists of an array of dual-axis tracking reflectors
(heliostats) that concentrate light on a central receiveratop a tower The receiver contains a fluid deposit, which can consist of
sea water. The working fluid in the receiver is heated to 5001000 C and then used as a heat source for a power generation
Solar Thermal Technologies
Solar Thermal Technologies Solar power tower Power tower development is less advanced than trough systems, but they offer higher efficiency and better energy storage capability.
World status: Under operational Under construction = = 37 MW 388 MW
Solar Thermal Technologies Compact Linear Fresnel Reflector Fresnel reflectors are made of many thin, flat mirror strips to concentrate sunlight onto tubes through which working fluid is pumped
Flat mirrors allow more reflective surface inthe same amount of space as a parabolic reflector, thus capturing more of the
available sunlight, and they are muchcheaper than parabolic reflectors.
Solar Thermal Technologies
Solar Thermal Technologies Compact Linear Fresnel Reflector World status Under operational = 8.4 MW 1 MW Under construction =
Solar Thermal Technologies Parabolic dishes System consists of a stand-alone
parabolic reflector that concentrateslight onto a receiver positioned at the reflector's focal point.
The reflector tracks the Sun along twoaxes. The working fluid in the receiver is heated to 250700 C and then used for
generate power.
Solar Thermal Technologies
Solar Thermal Technologies Parabolic dishes Parabolic dish systems provide the highest solar-toelectric efficiency among CSP technologies, and their modular nature provides scalability.
World status Under operational Under construction = = 2 MW 1 MW
Solar Thermal Technologies Integrated Solar Combined Cycle (ISCC) An ISCC plant comprises a conventional combined cycle (CC) plant, consisting of a gas or coal fired turbine, a heat retriever and a steam turbine with a solar field bolted on. Steam generated in the solar field is fed into the watersteam cycle of the CC plant, thereby increasing the power of the steam turbine
Solar Thermal Technologies
Solar Thermal Technologies Integrated Solar Combined Cycle (ISCC) Both high temperature and medium temperature CSP technologies are well suited for ISCC All the ISCC plants under construction are using parabolic trough technology
World status Under operational Under construction = = 75 MW 65 MW
Solar Thermal Technologies Summary of Technologies usage globally Operational capacity (MW) Parabolic Trough ISCC 1143 75 Construction Capacity (MW) Parabolic Trough Solar Power Tower 1375 388.4
Solar Power TowerFresnel Reflector Dish Stirling Total
37.58.4 1.72 1265.62
ISCCdish Fresnel Reflector Total
651 0 1829.4
Source: en.wikipedia.org/wiki/List_of_solar_thermal_power_stations
Solar Thermal Technologies Thermal Storage Required to operate CSP plants smoothly and continuously,
with out auxiliary firing Excess solar heat will be collected during the day and can be stored efficiently in liquid or solid substances Molten salts, ceramics, concrete, or other materials
The heat can then be extracted from these storage media at night or during cloudy periods to generate electricity
Solar Thermal Technologies
Photovoltaic System
Solar Photovoltaic Technologies Solar Photovoltaic Technology converts solar energy into direct electricity. Its is clean, reliable and ideal for both grid, off grid, remote and stand alone applications The system can be custom designed to meet the specific requirements of the customer. It produces Direct Current (DC) and require
inverters to convert to AC and can be stored inbatteries for use in non sun shine hours
PV Technology Classification Silicon based Crystalline Mono Crystalline (Single-Crystal) PV Cells Multi Crystalline (Poly-Crystal) PV Cells Amorphous Silicon (Thin film) PV Cells
Non-Silicon based Crystalline Poly Crystalline PV Cells
PV Technology Mono Crystalline (Single-Crystal) PV Cells These are extremely thin wafers of silicon, cut from a single silicon crystal. These are most efficient silicon cells (12 to 15%) and have a life of 25 years
The cells have a uniform color, usually blue or black
PV Technology Multi Crystalline (Poly-Crystal) PV Cells These are cut from multiple crystals grown together in an ingot. They are slightly less efficient (10 to 12%) and requires more surface area to produce a given amount of electricity However, the overall cost benefits are attractive
PV Technology Amorphous Silicon (Thin film) PV Cells Amorphous silicon is sometimes abbreviated "aSi" and is also called thin film silicon. Amorphous silicon units are made by depositing very thin layers of vaporized silicon in a vacuum onto a support of
glass, plastic, or metal. The most advanced of thin film technologies Operating efficiency ~6 to 8%
Makes up about 13% of PV market
PV Technology Non-Silicon based Crystalline Copper Indium Diselinide CIS with band gap 1 eV, high absorptioncoefficient 105 cm-1 High efficiency levels ~ 15 to 18%
Cadmium Telluride ( CdTe) Unlike most other II/IV material CdTe exhibits direct band gap of 1.4 eV and high absorption coefficient
PV Technology Emerging technologies Ultra Thin Wafer Solar Cells Thickness ~ 45m Cell Efficiency as high as 20.3%
Anti- Reflection Coating Low cost deposition techniques use ametalorganic titanium or tantanum mixed with suitable organic additives
Wind Energy
Wind Power Potential
Wind power density at 50m above the ground
Wind Power Potential Wind Potential for Nine Indian States
Wind Energy Technologies Wind Energy is converting kinetic
energy of wind into useful form Mechanical energy water pumping Electricity energy power generation
Broad categories Horizontal Axis Wind Turbines (HAWT)
Vertical Axis Wind Turbines (VAWT)
Sizes and Applications
Wind Energy Technologies Horizontal Axis Wind Turbines (HAWT) These are the most common style of wind mill The main rotor shaft, electrical generator and other axillaries will be kept at the top of tower They must be pointed towards wind direction for max
energy utilization Small turbines are pointed by a simple wind vane Medium turbines use wind sensor coupled with servo motor Large turbines will have a gearbox, which turns the slow rotation of the rotor into a faster rotation and is suitable to drive an electrical generator
Wind Energy Technologies Advantages For every 10 m height, wind speed increases by 20% and the power output by 34% High efficiency, since the blades always move perpendicularly to the wind direction
Disadvantages Massive tower construction, structural failures due to turbulence and maintenance issues Require an additional yaw control mechanism to turn the
blades toward the wind direction Braking or yawing device required to stop the turbine at high winds to prevent damage
Wind Energy Technologies Vertical Axis wind turbines (VAWT) Here main rotor shaft arranged vertically, not pointing towards wind direction Useful where the wind direction is highly variable or has turbulent winds
The generator and other primary components can be placed near the ground Easies the construct and maintenance
No yaw mechanisms is needed and can be
installed on a building rooftop Less wind energy is available for a given size Wind speed is slower at a lower altitude
Growth of installed wind power capacity in India
Small Hydro Power
Small Hydro Power
Small Hydro Power Hydropower is the oldest renewable energy technique known to the mankind for mechanical energy application as well as for electricity generation
Hydropower uses water resources to generateenergy Hydro power contributes about 25% out of total
power installation in the country
Small Hydro Power Hydropower projects are generally categorized into Small hydro, upto 25 MW Large hydro > 25 MW
Small hydro power projects are further classified as
Bio Energy
Bio energy Three types Biomass (solid), Biofuel (liquid), Biogas (gaseous)
Biomass Biomass refers to agriwaste and organic forest residue, which includes Wood, wood waste, straw, sugar cane leftovers, garden wasteand crop residues like baggase, prosopys, cotton stalk, elephant grass, coconut shell etc.
Bio energy Biofuel Bio-Diesel is produced from oils or fats. Feedstock for Bio-Diesel include animal fats, vegetable oils, soy,rapeseed, jatropha, mahua, mustard, flax, sunflower, palm oil, hemp, field pennycress, pongamia pinnata and algae. Pure Bio-Diesel is the lowest emission diesel fuel.
Bio-Ethanol is the most common Bio-Fuel worldwide. It is produced by fermentation of sugars derived from wheat, corn, sugar beets, sugar cane, molasses and any sugar or starch that alcoholic beverages can be made from. Ethanol can be used in petrol engines as a replacement for gasoline.
Bio energy BioGas It is produced by the process of anaerobic digestion of
organic material by anaerobes The organic material is biodegradable waste materials
The solid byproduct can be used as a Bio-Fuel or a fertilizer
Jawaharlal Nehru National Solar Mission (JNNSM)
JNNSM- Mission Objectives JNNSM has been launched under the National Action Plan on Climate Change (NAPCC) on January,
2009 with an objective: To establish India as a global leader in solar energy, by creating policy conditions for its diffusion across the
country Mission anticipates achieving grid parity by 2022 and parity will coal based thermal power by 2030.
Aim of the mission is to focus on setting up an enablingenvironment for solar technology both at centralized and decentralized level.
Mission Targets3- phase approach has been formulatedApplication Segment Phase - I 2010-13 Utility grid power Off- grid Applications Solar Thermal Collectors Area Manufacturing Base Solar Lighting Systems 1,100 MW 200 MW 7 million Sqm --Phase-II 2013-17 4,000-10,000 MW 1,000 MW 15 million Sqm --Phase- III 2017-22 20,000 MW 2,000 MW 20 million Sqm 4,000-5,000 MW 20 million
Mission Strategy Create necessary environment to attract industry and project developers for investment in power
generation, manufacturing. Work closely with State governments, regulators, power utilities and local self government bodies. Attract banks and financial institutions to provide necessary finance for setting up solar power projects for grid/ off-grid. Promote off-grid solar applications to meet light and power requirements by provision of low cost credit through re-finance facility from IREDA
Policy & Regulatory framework Solar Power Purchase Obligation Solar specific RE Certificates Incentivizing through NTPC Vidyut Vyapar Nigam Ltd. (NVVN) for setting up of large solar
power plants. Rooftop solar PV and other small power plants connected to LT/11 KV grid with a remunerative feed-in tariff ( routed through IREDA)
Fund RequirementsFirst stageA Grid Connected 1,100 MW Approximately Rs. 16,500 crores 200 MW Rs. 5,000 crores C Solar Thermal collectors 7 million meter square Rs. 7,000 crores
Second Stage20,000 MW Approximately Rs. 3,00,000 crores 2,000 MW Rs. 50,000 crores 20 million meter square Rs. 20,000 crores
B
Off-Grid Applications
Current Status of Solar Power Projects1. MIGRATION SCHEME 84 MW (54 MW PV + 30 MW ST) capacity selected
under migration PPAs signed with 16 developers on 15th October 2010 PSA signed with Distribution Utilities of Rajasthan (66 MW), Maharashtra (11 MW) and Punjab (7 MW) Cost of bundled power = Rs. 5.69/kWh, considering
CUF PV(19%), ST(23%), NTPC (85%)CERC tariff PV (Rs 17.91/kWh), ST (Rs 15.31/kWh) NTPC Power Rs. 3.00/kWh
Current Status Solar Power Projects2. NEW PROJECTS 620 MW capacity solar projects by 37 bidders
selected by NVVN on the basis of discounting offeredon CERC tariff through bidding. This includes 470 MW capacity solar thermal and 150 MW
solar photovoltaic projects.
PPAs with 36 SPDs signed for 615 MW capacity upto 10th January 2011. PSAs signed with Andhra Pradesh, Karnataka, Orissa, Punjab, Rajasthan, West Bengal, Uttar Pradesh
Current Status Solar Power Projects2. NEW PROJECTS (Cont)
Cost of bundled power = Rs. 4.78/kWh, considering CUF PV(19%), ST(23%), NTPC (85%) Discounted CERC tariff PV (Rs 12.16/kWh), ST (Rs 11.48/kWh) NTPC Power Rs. 3.00/kWh
Proposed CUF by SPDs For Solar Thermal between 25-40% For Solar PV between 21-24.5%
Current Status Solar Power Projects2. NEW PROJECTS State wise capacityS. No. State Solar PV Capacity (MW) Solar Thermal Total
12 3 4 5 6 7
RajasthanGujarat Andhra Pradesh Karnataka Maharashtra Orissa Tamil Nadu
10515 10 5 5 5
40020 50
50520 65 10 5 5 5
8
Uttar PradeshTotal
5150 470
5620
Contract Structure PPA & PSANTPC & NVVN signs a PPA for X MW of coal power for a term of 25 years at a Tariff determined by CERC.
Contract Period: 25 years
from Date of Commissioning Back-to-back contracts: PPAs and PSA are on backto-back basis
PPA
X MW
X MW X+X MW
NVVN
PSA
Discom
SPD & NVVN signs a PPA for X MW of Solar power for a term of 25 years at a Tariff determined by CERC.
NVVN bundles X MW Solar Power with X MW unallocated coal power and come up with a bundled tariff PPAs and PSA are on back-to-back basis
NVVN & Discoms signs a PSA for 2X MW Bundled Power at the rate identified in the PSA.
Rooftop and other Small Solar PV Power Plants up to 2 MW 78 Projects of
capacity 98 MWshortlisted. PPAs where signed and registered with
IREDA
Current Capital CostCapacity Capital Expenditure
(MW)1-5 5-10
(Rs Crores /MW)17 16
10-5050-100
15.515
STATUS OF GRID POWER PROJECTS TOTAL INSTALLED CAPACITY = 146.5 MW MNRE PROGRAMMES = 84.5 MW STATE PROGRAMMES= 62.0 MW
MAJOR STATES GUJARAT RAJASTHAN TAMIL NADU KARNATAKA 51 MW 43.65 MW 7 MW 6 MW
MAHARASHTRA 18 MW
Policies for Renewable Power The Electricity Act 2003, mandates to: Create competition, protect consumers interest & power for all Facilitate private sector investments Permit stand-alone systems rural areas Provide open access Determination of preferential tariff Specify minimum percentages for purchase of
renewable power
Policies for Renewable Power
Policy Direction Introduction of Generation Based Incentives. Introduction of Penal provisions for not meeting
RPOs. Introduction
of Tradable Renewable Energy
Certificates. Renewable Energy Law
Policy Framework for Renewable Favorable fiscal/policy environment exists for development of RE sources economically supported by Government subsidies and fiscal incentives From central Government Income Tax Holiday Accelerated Depreciation Concessional Custom Duty/ Duty Free Import Capital/ Interest Subsidy
Policy Framework for Renewable From State Government Energy buyback, power wheeling and banking facilities Sales Tax concession benefits Electricity Tax Consumption Demand cut concession offered to industrial consumers
who establish power generating units from RE sources. Capital Subsidy
Regulatory Frame Work Central Electricity Regulatory Commission set up to deal with licensing issue for power trading and interstate transmission and tariff related issues 24 States have constituted State Electricity regulatory Commissions to deal with tariff issues and licensing issues.
17 states have announced RE policy.
Other Policy Support Industrial clearances is not required for setting-up of renewable energy industry.
No clearance is required from Central Electricity Authority for powergeneration projects upto Rs. 1000 million. Facilitates for promotion of export oriented units are available for renewable energy industry also. Financial support is available to renewable energy industries for taking up R&D projects with technology institutions. Assistance for Export Promotion and Market Development
Blending of Ethanol is allowed upto 5% with Gasoline.Concessional customs duty on imported items for power generation RE projects
Market Barrier
1. Solar Technology Low awareness Technology Input variation Output variation Yearly variation 2. Industrial Experience of Technology
3. Standards of technology not there Efficiency Output/ Input standard Component standard 4. Cost of the system Cost of System Availability hours
Integration with back up
Cost of back up
Research and Development To set up a solar research council to guide the
overall technology development strategy To establish a national centre of excellence to implement the plans formulated by the council.
Main tasks will be testing and certification,developing standards and specifications, networking among different research institutions.
Status of Grid Solar Power-I Small Power Plants up to 2 MW Projects for 120 MW shortlisted.
Projects up to 100 MW capacity where PPAsigned and registered with IREDA, are finalized. Compliance to technical standards mandatory. GBI will be given to DISCOMs on reimbursement basis.
Status of Grid Solar Power-II Power Plants above 5 MW capacity 1,000 MW Capacity allocation between SPV and ST
to be 50:50 by NVVN 84 MW capacity projects (54 PV & 30 Thermal) allocated under Migration Selection of PV projects to be done in two batches First Batch in 2010 and limited to 150 MWp Second batch next year of approximately 300 MWp Solar Thermal: selection for 470 MW to be done in 2010
Channelization of Funds for Off-grid Solar Applications Funding under scheme Project mode. Directly by MNRE (approved by PAC) Scheduled commercial banks, NBFCs, FIs such as NABARD, NHB, SIDBI, IREDA etc.
Additional channels for supply and maintenance(RESCOs, Financial Integrators, System Integrators, MFIs, Government agencies etc.)
Channelization of Funds for Off-grid Solar Applications Accreditation
Performance Monitoring Refinancing MoU signed by IREDA with NABARD, NHB and Central Bank of India.
Financing Schemes Project Financing Schemes Equipment Financing Schemes Financing Through Intermediaries Quantum of Assistance - Upto 70% of Project Cost Rate of Interest - 11.25% to 12.75%
Repayment Period - Upto 13 Years
Resource Base Authorized Share Capital :Rs 1000 Cr
Paid-up Capital Net-worth
:Rs 520 Cr:Rs 871 Cr :Rs 1115.69 Cr
Domestic Borrowings :Rs 773 Cr International Borrowings
International Partners Govt of Netherlands, 1991 World Bank (1st LoC), 1993 DANIDA, 1993 : 18 Million Dutch Guilders :$ 145 Million :$ 15 Million
Asian Development Bank, 1997 :$ 100 Million KfW, Germany (1st LoC), 1999 : 61.35 Million
World Bank (2nd LoC), 2001 KfW, Germany (2nd LoC), 2008 KfW, Germany (3rd LoC)
:$ 110 Million: 50 Million : 19.9 Million
Lines of Credit in Pipeline AFD (France) JICA (Japan) : 80 Million :$ 100 Million
Highlights Dedicated FI for RE Financing Unique in the World Specialized knowledge of RE / EE sector
Recognized internationally High Brand Equity All Multilaterals/ Bilateral prefer working with IREDA Perceived as a leader in the sector
Profit earning & dividend paying Rated Excellent for FY 2008-09 Expected Rating Excellent for FY 2009-10
NBFC as per RBI Classification ISO 9001:2000 Certified Company
Role of IREDA under JNNSMType of system Grid connected projects Small solar power projects Role of IREDA Financing of Projects Financing of Projects
and roof top systems
Generation Based Incentive Monitoring
Off- grid applications
Soft loans through banks by re-financing Monitoring of the systems
Solar thermal sectorSWHS
Administration of Interest subsidy scheme through banks / financial institutions Funding of projects Funding through intermediaries
Solar Manufacturing
Soft loans Working capital
Re-financing facility as per MNRE
Risk Factors in Funding Solar Projects
Risk Factors in Funding Solar ProjectsRegulatory Risk Fixing of the tariff and assurance on the power sale agreement Technology Risk Implementation Risk Infrastructure Risk Repayment Risk Technology yet to be proven on the ground Uncertainties in the implementation of the project as per schedule Inadequate evacuation facility and clearances on land and other statutory clearances. Non assurance of repayment from the utilities may result in repayment risk to the developers/ FIs.
Risk Factors in Funding Solar ProjectsFinancial Risk In time financial closure by the project developer.
High cost so funding from single source is a risk.Raising of equity Guarantee and Long term guarantee and warranty from the
Warranty RiskPolitical Risk
technology providers for the new technology.Changes in fixing of unallocated power with respect to change in political system.
Policy Risk
Assurance of long term policy with greater accuracy and uncertainties in development of the solar sector.
Suggestions for Risk Mitigation to finance Solar Projects
Suggestions for Risk Mitigation Ad vocation for long term/stable/consistent policies at central / state level- to honor PPAs and MoUs
Frequent/close interaction with all stake holders includingregulatory commissions to stipulate appropriate GBI/PPA based on capital cost.
Proper Resource assessment studies. Provision of partial risk guarantee fund from Govt. Importance projects. To create special single window clearance cell at state level. of timely clearances/approvals for solar
Suggestions for Risk Mitigation Promoters to take advance actions to avoid delay of deliveriesto meet targets under JNNSM. To encourage establishment of more manufacturing units/ suppliers in the country- to deliver indigenous cells and modules as per the requirement of JNNSM . To establish a mechanism to have information exchange between various FIs and banks-for co-financing or consortium financing. Detailed site survey reports to be undertaken through
professional bodies- to maximize performance efficiencies.To establish more training institutions for producing skilled manpower-capacity building.
Suggestions for Risk Mitigation To stipulate suitable conditions for recovery of loan from operations of solar projects in the event of failure of core business (for non IPP projects). Concurrent monitoring of projects by Fis by appointment of lenders engineers. Periodic inspection / monitoring of projects even after implementation. (TRA and Generation data)
Innovative financing models by accessing low costfunds from international institutions.
Financial Incentives Soft loan at @ 2 % for domestic sector @ 3% for non profit organizations and 5% for profit making
organizations 5 years loan repayment period 5 years Annual Maintenance Contract
85% of project cost as loan, availability for any capacity and for any end user 80% Depreciation for end user Custom and Excise Exemptions
GBI based incentives @ Rs 18.45 for SPV and Rs. 15.31 for solar thermal power
List of Project Developers Qualified for Migration to JNNSM
Name of applicant Acme Tele Power Ltd, Gurgaon Dalmia Solar Power Ltd, New Delhi Entegra Ltd, Ansal Bhawan, New Delhi
State Rajasthan Rajasthan
Capacity (MW) 10 10
Rajasthan
10
In the first phase 16 developers projects submitted based on SPV with an aggregate capacity 84 MW and Solar Thermal with an aggregate capacity 30 MW
MissionThe Ministry of New and Renewable Energy, Government of India have proposed to develop
solar PV capacity of 100 MW as follows:Sl. No Project Category1 Projects connected at HT level of distribution network with installed 80 MW
Capacity limit
capacity of 1 MW and up to 3 MW2 Projects connected at LT level of distribution network with installed 20 MW
capacity lower than 1 MW
Components Of Tariff The following are the components of tariff for solar energy: Capital Cost Capacity utilization factor De-rating Debt-equity ratio Term of loan
Rate of interest Interest on Working Capital Return on equity Life of plant and machinery Rate of depreciation Operation and maintenance expenditure Auxiliary Consumption
Accelerated Depreciation Benefit
Capital Cost The cost of a solar power project is mainly dependent on the cost of PV modules / plant and machinery, technology adopted, location of the site and capacity The Indian Renewable Energy Development Agency Limited (IREDA) has recommended a capital cost of Rs. 18 to 20 Crores per MW for Solar PV thin film technology and Rs. 22 to 25 Crores per MW for Solar PV single / multi crystalline technology The Commission decides that the Infrastructure Development Charges (IDC) of Rs. 25.75 lakhs per MW should be loaded to the capital cost. Accordingly, the capital cost is refixed as Rs. 17.1575 crores per MW.
Solar PV has one of the highest capital costs of all renewable energy sources, but it has relatively low
operational costs, owing to the low maintenanceand repair needs. For a solar PV power plant, the approximate
capital cost per MW is approximately Rs. 16 crores the precise cost depends on scale. This includes the cost of panels, the balance of systems, the cost of land and other support infrastructures.
Component Solar panel arrays Inverter Balance of System Installation
Amount
% of
(in Rs crores)8 2 2 2
Total50 12 13 10
Others (Infrastructure,Margins)
2
15
Capacity Utilization Factor (CUF) CUF is the ratio of actual energy generated by the Solar PV project over the year to the equivalent energy output at its
rated capacity over the yearly period. CUF for Solar PV projectdepends on solar radiation and number of clear sunny days. The Indian Renewable Energy Development Agency Limited
(IREDA) has recommended a CUF of 15 to 20%.The maximum solar radiation in Tamil Nadu is 5.8 kWh/Sq.mtr/day in the Solar Radiation Handbook, 2008 of MNRE has projected annual solar insolation in Chennai as 5.37. Considering the above, the Commission adopts a CUF of 19% in this order as adopted by the CERC
De-rating De-rating factor has not been foreseen by otherState Commissions / CERC. It is natural that any material used in the PV module for energy conversion, loses its efficiency due to Aging Being a new area without information on past
performance parameters, fixation of de-ratingfactor for a Solar PV Plant can only be an approximation. IREDA has recommended a de-
rating factor of 0.5 to 1% per annum
Term of Loan The Commission fixed a tenure of ten yearswith moratorium of one year in its Tariff Order based on the consideration that term loans sanctioned by IREDA stipulated this tenure. The Commission decides to retain the same tenure in this order.
Rate of interest CERC has considered the long-term PLR of State Bank of India plus 150 basis points
as adequate. TEDA has recommendedinterest rate of 12% with repayment
period of 7-8 years. The Commission considers that interest rate of 12% is reasonable
Interest on Working Capital The CERC has included the following components in working capital in their Regulations, 2009: Operation and Maintenance expenses for one month; Maintenance spares @ 15% of the O&M expenses, Receivables equivalent to 2 months of energy charges for sale of electricity calculated on the normative CUF;
Commission has decided to adopt an interest rate of 12% onworking capital as considered in order of 2009 along with the following working capital component : Operation and Maintenance expenses for one month; Maintenance spares @ 1% of the O&M expenses and Receivables equivalent to 1 month of energy charges for sale of electricity calculated on the normative CUF.
Return on Equity CERC has adopted RoE of 19% pre tax for the first ten years and 24% for the remaining 15 years for solar PV projects The Commission decides to adopt 19.85%
pre-tax return on equity for this order.
Life of plant and machinery The Commission decides to consider the
solar
PV
plant
life
of
25
years
as
considered by CERC in their Terms and
Conditions for Tariff determination fromRenewable Energy Sources Regulations, 2009.
Rate of Depreciation CERCs recommended Differential Depreciation Approach over loan tenure and period beyond loan tenure over useful life computed on Straight Line Method. It is proposed to adopt the rate prescribed in the CERCs regulation, i.e. depreciation rate of 7% for
the initial 10 years and 1.33% for the remainingyears.
Operation and Maintenance expenses O&M expense includes expenditure on manpower,
repairs,cost.
spares,
consumables,
insurance
and
overheads and has suggested 0.5% of the capital
Commission decides to adopt the rates prescribedin the CERC regulation. i.e. Rs. 9.515 Lakhs per MW for the first year of the Control period (2010-11) and shall be escalated at the rate of 5.72% per annum for the remaining periods.
Auxiliary Consumption Auxiliary consumption is the auxiliary power
requirement for equipments / devices for cooling of
the
power
conditioning
units,
lighting
of
office/station yard, water sprinklers, monitoring and control units, communication services etc. Commission considers 2% of auxiliary consumption is reasonable for solar PV power plants.
Accelerated Depreciation Benefit For the projects availing the benefit of accelerated depreciation as per applicable income tax rate @ 33.99% (30% IT rate+ 10% surcharge +3% Education cess) has been considered.
Generation Based Incentives The key attributes of the GBI Scheme are: Any Project that is commissioned after 31st December, 2009
A maximum incentive with a 5% reduction and ceiling of Rs. 11.40per KWh. The generation based incentive will continue to decrease as and when the utility signs a PPA for power purchase at a higher rate. Solar PV power generation plants of a minimum installed capacity of 1MWp per plant, either a single unit or modular units at a single location will be eligible for generation based incentive.
However, 1 MWp capacity may be setup through modular units at asingle location.
Contacts www.mnre.gov.in, www.ireda.in Dr Ashviki Kumar, Director, Solar Thermal, Power Projects,
[email protected], 24363546 Dr. Sant Ram, Director, Solar Thermal (off-grid), [email protected], 24361920 Dr B. Bhargava, Director, Solar PV (Grid), [email protected], 24361891 Dr G. Prasad, Director, SPV (off-grid), [email protected] Dr. A. R. Shukla, Advisor, Bio-Gas, [email protected], 24361604 Dr. D.K. Khare, Director, Bio-Mass, [email protected], 24363402
Mr A.K. Dhussa, Director, Waste to Energy, [email protected], 24364188 Mr Dilip Nigam, Director, Wind Energy, [email protected], 24368911 B.V. Rao, GM, IREDA, [email protected],
THANK YOU