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November 6, 2013

Renewable energy projects are eco friendly..., are they really?

 

solar and wind projects are also red flagged

Solar and wind energy are considered environment-friendly, with zero carbon emissions. These sources of energy are going to be the main elements of India’s proposed march towards a low-carbon-economy. But doubts have begun to be expressed over long-term ecological and social fallout of rolling out wind and solar energy on a large scale.

Going by the warning issued in a recent government-sponsored study of select green power projects in the country, large solar and wind power projects may lead to a conflict situation in years to come if corrective steps are not taken to minimise their ecological and social impact.

While wind and solar generation does not result in direct greenhouse gas emissions unlike coal-fired power stations it has other serious implications.

USE OF LAND, WATER

Land and water are key issues in conventional power projects. Now the same issues may plague renewable energy projects as well.

These projects require large tracts of land which is a scarce resource. “There is a possibility that resource demand by solar and wind projects may rake up several socio-economic conflicts in near future. Such projects will have to compete with other sectors for land. This will either impede the growth of renewable energy development or create direct conflict between projects and communities residing in vicinity of such projects,” the report from the Ministry of New and Renewable Energy (MNRE) has said.

Another cause of possible conflict would be water requirements of green power projects, particularly solar energy farms.

Solar panels need to be cleaned with water every day, since dust gathered on them could reduce their efficiency. Typically, a large solar photovoltaic plant could have several hundred panels.

Water requirement of large solar projects for maintenance purposes may be a cause of concern for the communities residing close to such projects and sharing same resource, according to the report.

This is a serious issue because solar farms are usually set up in arid and semi-arid areas, which are already water-stressed as they lie in low rainfall regions.

The sites visited during the course of the study included wind farms in Tirunelveli and Kanyakumari in Tamil Nadu, Satara and Pune districts in Maharashtra as well as a solar farm in Anantapur district of Andhra Pradesh.

India is currently the fifth largest wind power producer in the world. The potential for solar energy production is also very high as about 58 per cent of the total land area receives sufficient solar radiation for sustainable harnessing of solar power.

The total installed capacity of grid-connected renewable energy in the country is over 28,000 MW while off-grid power capacity is about 880 MW. About 70 per cent of total renewable energy comes from wind and about 4.5 per cent from solar photovoltaic.

Besides land and water issues, renewable energy production also damages the environment. An earlier assessment by the Centre for Science and Environment had pointed out that erection of turbines on hilltops and in forest areas is harmful to local ecology.

This requires building access roads which involves tree felling and blasting of rocks. Soil erosion results in silting of streams and water bodies. Construction of roads also results in linear fragmentation of habitat and scares away animals. In addition, wind farms could cause health impact due to shadow flicker and noise pollution.

Care needs to be taken to ensure the wind mills are not located in the path of migratory birds.

The Madhav Gadgil committee report on Western Ghats had pointed out that wind mills being set up in large numbers in this ecologically fragile area is leading to substantial negative impact on ecology and water resources.

ECO IMPACT ASSESSMENT

At present, it is not mandatory to conduct an Environment Impact Assessment (EIA) for wind or solar power projects under the Environment Protection Act.

Approval from the Ministry of Environment and Forests is required only if location of a wind power project is in a forest area or wildlife sanctuary.

An assessment by the Centre for Science and Environment (CSE) had found that about 45 per cent of total wind power generated in India comes from turbines located in forest areas. Small hydro projects below 25 MW capacity also do not need an EIA though it has been observed in Uttarakhand and Western Ghats that such projects are not benign to the environment.

Yet they are entitled to all fiscal benefits given to renewable projects. The Government should address these concerns as well.

Seeking to strike a balance between the need to encourage growth of green energy and environmental concerns, the report has suggested that new projects may be set up in areas which are “conflict free and readily available”.

At the same time, the use of natural resources such as land and water by these projects should be regulated. Instead of free flowing water, sprinklers may be used to clean solar panels.

Water harvesting and reuse of water may also be encouraged to promote water conservation. For the benefit of project developers, the Government can identify ‘go green’ (where projects can be set up without any objection), ‘go slow’ and ‘no-go’ regions in the country, it has been suggested.

Some States have already started experimenting with innovative ways to reduce land requirement for large renewable energy projects.

One way could be installing solar panels over large building or over irrigation canals as is being done in Gujarat. In wind farms, about 80 per cent of the land remains under-utilised or unutilised by projects.

The neighbouring community may be allowed access to such land for productive use. Ownership of windmills by villagers or their cooperatives — as is being tried in Germany — could also ensure greater community participation.

A framework for environmental oversight for green power is certainly required, but it should be done in a way that does not stifle growth of renewable energy.

India needs to move ahead in all forms of renewable energy, but in a responsible manner way that causes minimum or no damage to the environment.

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Solar Steam Generators At India's First CSP Plant Now Online...

 

CSP Plant of Godawari Green Energy

Godawari Green Energy Ltd. has fired up India's first grid-connected concentrating solar power (CSP) plant. The 60 MW Godawari facility, located in the Jaisalmer district, employs a steam generation system from Denmark-based Aalborg CSP & Sojitz Corp. Godawari expects its CSP plant to produce 130 GWh of electricity per year.

Aalborg CSP says its steam generator is designed to perform with a high gradient of up to 9 degrees C per minute, allowing a rapid ramp-up every morning and after transient clouds. The company says this capability can result in more than 30 minutes of extra operations during a normal nine-hour day, thereby increasing energy production by 5%.

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Solarsis sets up rooftop solar PV unit for IIT Madras...

 

Solarsis Rooftop at IIT Madras

Solar photovoltaic solutions company Solarsis has installed a rooftop solar photo-voltaic system in IIT Madras.

The Solar PV system incorporates various technologies in modules and inverters. The solar plant is installed on top of the 50 year old Electrical Sciences Block at IIT-Madras which aims to build 1 MW solar unit on top of their existing buildings.

Venkat Rajaraman, CEO, of the Hyderabad-based Solarsis, in a statement said the structure is designed to withstand high wind zone of the Chennai coastal region. The plant also brings high degree of reliability and protection to enable to smooth interaction with the grid.

“IIT always being an early advocate of promising technologies like solar and we are doing our best to contribute to some key challenges in solar adaptability through a smart grid controller,” Ashok Jhunjhunwala, Professor in the Electrical Engineering Department, said.

“We plan to test Smart Controller for solar, which is currently being designed by IIT-M, with the rooftop solar plant. Also the elevated structures ensure that we continue to use the roof as before for our regular use,” Jhunjhunwala added.

The IIT Madras Solarsis rooftop solar plant is a mix of different type of modules of various capacities. The 90KW solar plant will generate 1.5 lakh units per annum and helps offset 90 tonnes of carbon dioxide.

“It is a collaborative effort between industry and an academic institution to pursue practical green electricity alternatives. We did an extensive structural design analysis in collaboration with the Professors at IIT to come out with this solution. We believe initiatives of this kind will pave way for others to adopt green energy saving measures that is environment friendly,’’ Venkat Rajaraman, said.

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DVC failed to keep its promises over power plant: WB govt...

 

DVC Plant in Dark

In a bid to put the blame on DVC for the impasse over the Rs 10,000 crore thermal power plant in West Bengal's Purulia district, state Industry Minister Partha Chatterjee today accused the power utility of not keeping their word regarding compensation to land losers.

Referring to the land acquisition process for the plant at Raghunathpur which began in 2007 and when the local residents were promised jobs, Chatterjee said, "Damodar Valley Corporation (DVC) should honour the agreement they signed during the Left Front regime".

Reacting to the letter written by DVC chief engineer and project head Debashis Mitra to the Purulia district magistrate, Chatterjee said, "His (Mitra's) primary responsibility is to run the site and resolve the dispute and give weight to the agreement which was signed in 2007, instead of making it an issue time and again threatening to pull out from the project. This is in very bad taste."

Chatterjee's comments came after Mitra said he had written to the DM, Purulia stating facts about the delay in project implementation and if necessary action was not taken by the state administration, the company would be left with no option other than shifting project from Raghunathpur.

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Power equipment manufacturers offer discounts to revive growth...

 

Discounts on Power Generation Equipements

In a desperate bid to woo customers and revive growth in the capital goods space, private sector manufacturers are taking a haircut and offering discounts for power generation equipment.


In engineering, procurement and construction (EPC) orders, for instance, manufacturers are now offering a discount of 10% over and above average prices of Rs.4.24-4.5 crore per megawatt (MW) to run their plants.


Indian power generation equipment manufacturers include state-owned Bharat Heavy Electricals Ltd (Bhel), Doosan Heavy Industries and Construction Co. Ltd, and joint ventures between Larsen and Toubro Ltd (L&T) and Mitsubishi Heavy Industries Ltd; Toshiba Corp. and JSW Group; Ansaldo Caldaie SpA of Italy and Gammon India Ltd; Alstom SA of France and Bharat Forge Ltd; BGR Energy Systems Ltd and Hitachi Power Europe GmbH; and Thermax Ltd and Babcock and Wilcox Co.


“With no orders around, manufacturers are ready to work on wafer-thin margins or even negative margins,” said a Mumbai-based capital goods sector analyst requesting anonymity.


In the domestic market, slowing economic growth, high borrowing costs and delays in securing regulatory approvals have impacted power plants. No private sector power equipment maker has received orders in 2012-13 and it is unlikely to be very different this year, especially in the aftermath of irregularities associated with the allocation of coal blocks by the government.


“Projects with an implementation horizon of 2020 have placed orders. Other than projects like ultra-mega power projects where domestic sourcing is required, the electricity generation equipment market at best is a 10,000MW per year of orders market, while supply may be three times that, leading to cut-throat competition,” said Debasish Mishra, senior director at Deloitte Touche Tohmatsu India Pvt. Ltd, an audit and consulting firm.


India’s power generation equipment manufacturing space has a capacity of around 30,000MW, with an equal share of boiler and turbine generator sets. Overall, India has a power generation capacity of 2,28,721.73MW, with a targeted additional capacity of 88,000MW in the current Five-Year Plan (2012-17).


Power project developers have also been struggling with interlinked issues such as fuel shortages, and delays in signing fuel supply agreements and long-term power purchase agreements.


“These are challenging times. The manufacturers are offering rock-bottom prices for the sake of running their plant. The logic is, there is not much work around and one can’t keep the facilities idle. So in such a scenario, the focus is on recovering the operating cost. We can’t offer such discounts. There are so many claimants to one tender,” said a senior executive at Bhel, India’s largest power generation equipment provider.


Last year the government hiked the import duty on power generation equipment to 21% from 5% in a bid to hold off competition from Chinese manufacturers such as Dongfang Electric Corp. and Shanghai Electric Power Co. Ltd. But even that move hasn’t helped much.


“We have issued an advisory to the states to only buy from domestic equipment manufacturers. This may help in some orders being placed,” said a senior Union power ministry official requesting anonymity.


“This pricing strategy has been played by the private sector manufacturers. But only those with huge orders on the engineering side can play this for a long time. Even our prices are very competitive as we can’t be below par,” added another Bhel executive who also didn’t want to be identified.


Queries emailed to the spokespersons of Bhel, Doosan Heavy Industries, L&T, Mitsubishi Heavy Industries, JSW, Alstom, Bharat Forge, Hitachi, Thermax, and Babcock and Wilcox on Monday evening remained unanswered till press time on Tuesday.


A Toshiba spokesperson in an emailed response said, “We cannot clarify the general price trends since it differs from deal to deal depending on the bidding process and other factors. At the same time, we cannot disclose the price for specific deal considering the relations with customers.”


An Ansaldo Caldaie spokesperson said, “We are in line with the present market prices.”


A Gammon spokesperson in an emailed response said, “Very few projects relating to thermal power plants are in the bidding stage at present. In any case, our JV (joint venture) is not participating actively on these offers at the moment and hence quoting at a discount as mentioned by you does not arise.”


A BGR Energy Systems spokesperson in an emailed response said, “We win orders on a competitive bidding basis through a transparent process.”


B. Prasada Rao, chairman and managing director of Bhel, articulated the general mood of pessimism at the company’s annual general meeting in September, saying, “Prevailing economic and business environment do not give assurance of recovery in economic and business environment in near future.”


Bhel’s order inflow rose 43% to Rs.31,528 crore in the year ended 31 March. In comparison, it had received orders worth Rs.60,507 crore in 2010-11 and Rs.22,096 crore in 2011-12.


The only significant order that Bhel secures this year is for the supply of a steam generator package for two thermal units of 500MW each from Neyveli Lignite Corp. Ltd. The Rs.2,569 crore order comes at a time when Bhel has been struggling to optimally run its manufacturing capacity of 20,000MW per annum.


Analysts believe that the tough times may continue for the sector. “There are no visible near-term signals that we are close to any turnaround in the sector,” wrote UBS Global Equity Research in a 28 October report.


“Although it appears that the sector may have reached a bottom, sector participants expect conditions to remain difficult in the short to medium term and anticipate no major revival,” the report went on to add.


Similarly, Credit Suisse India Research said in a 27 August report, “We expect power sector ordering to remain sluggish at least until FY15 as: (1) reforms to augment domestic coal production are still lacking (linkage coal allocation is restricted to 78 GW of post Mar 2009 projects, implying another 62 GW of capacity already ordered would get coal only after Mar 2017), (2) auctioning of captive coal blocks for private companies is yet to commence and (3) limited power procurement bids are likely to be floated under the new Case-II bidding norms.”

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November 5, 2013

Power Ministry awaits comments on hiving off POSOCO...

 

Hiving off POSOCO

Hiving off electricity grids operator POSOCO into a separate company is likely to take some more time with the Power Ministry yet to complete inter-ministerial consultations on the proposal.

Power System Operation Corporation (POSOCO), which ensures integrated functioning of regional and national electricity systems, is a wholly-owned subsidiary of state-run Power Grid Corp.

The move to make POSOCO a separate entity comes at a time when more private players are getting into power transmission segment.

The Power Ministry has floated a draft Cabinet note on the proposal and comments have not come from all the Ministries. Once the inter-ministerial consultations are complete, the Ministry would put it up for Cabinet approval, a senior official said.

Earlier, the Department of Public Enterprises had reservations about various aspects, including salary structure of a separate POSOCO. The concerns were sorted out by the Power Ministry before moving the draft Cabinet note.

Voices for making POSOCO an independent regulator gained momentum especially after the unprecedented collapse of electricity grids last year that affected more than half of the country's population.

Overdrawal of electricity, beyond their allocated quota, by some states, was cited as among the reasons for failure of grids last year.

Recently, Power Minister Jyotiraditya Scindia had said that private sector participation is being looked in the transmission sector and hence there is a need to make POSOCO a separate entity.

In 2012-13 financial year, POSOCO registered a net profit of Rs 85.65 crore while the turnover touched Rs 266.37 crore. balendu jha is online.

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FinMin seeks gas allocation details from Power Ministry...

 

Gas Allocation Details for Power Projects

The Finance Ministry has sought from the Power Ministry details of fuel allocation to gas- based plants before giving its nod to pool prices of imported and domestically produced natural gas.

"Ministry of Finance has asked us to provide the gas allocation list of power plants and also the ones which have signed PPAs (Power Purchase Agreements)," a Power Ministry official told PTI.

The ministry has proposed to pool prices of imported and domestically produced natural gas to be supplied to power plants stranded due to drop in production of the fuel from Reliance Industries' KG-D6 block.

The ministry floated a Cabinet note last month to seek approval to pool imported liquefied natural gas (LNG) with the fuel available from the KG-D6 block after meeting the requirements of fertiliser units. The move is aimed at helping gas-starved power plants.

As per the ministry's proposal, during 2014-15, around 3,000 MW capacity power plants will get gas under the gas-pooling mechanism. The electricity produced from these plants is likely to be sold at a tariff of Rs 7 per unit.

The proposed electricity tariff was derived after pooling the prices of imported and domestic gas and deducting government subsidy, which requires approval, the official said.

The tariff may increase to Rs 7.50 per unit in 2015-16, when gas will be made available to additional power plants.

And in the financial year 2015-16, the remaining 4,800 MW capacity plants will also be able to get gas.

Currently, 7,800 MW of gas-based power generation is stuck due to scarcity of natural gas.

The proposal will be finalised once the Finance Ministry agrees to provide the subsidy. State-run GAIL India will be the facilitator for the price-pooling mechanism.

The price of KG-D6 gas was set at USD 4.2 per million British thermal units by the government and is proposed to be doubled from April 2014. LNG costs about USD 13-14 per mmBtu.

The fertiliser sector currently gets 31 million standard cubic metres a day of gas from domestic fields.

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NGOs want World Bank out of Tata project...

 

NGO on Tata Power's Mundra Project

Over a hundred non-governmental organisations focused on environmental and social issues have demanded the World Bank withdraw assistance to a 4,000 Megawatt power project operated by Tata Power at Mundra in Gujarat.

This comes days after the Ombudsman for International Finance Corporation (IFC), the Washington-headquartered investment unit of the World Bank Group, reported serious lapses in the supervision of the Ultra Mega Power Project (UMPP). IFC is one of the lenders to the Rs 20,000 crore project. The Compliance Advisor Ombudsman (CAO) report was a response to a complaint by local fishermen on environmental and social impact of the project.

“Your endorsement of IFC’s response to CAO findings and thus letting IFC and the company continue the violations merits nothing less than condemnation,” National Alliance of People’s Movements (NAPM) said in an e-mail to World Bank President Jim Yong Kim. The e-mail, reviewed by Business Standard, was endorsed by 102 NGOs including Narmada Bachao Andolan, Mazdoor Kisan Shakti Sangathan and National Fishworkers’ Forum.

IFC has already refuted the charges levied by the Office of the CAO for the IFC and justified its actions and funding for the power plant. "CAO report reflects the observations on the internal processes of IFC and thus it will only be appropriate for IFC to respond. We are yet to read through the report and would discuss with IFC if there were any issues related to CGPL," Tata Power had said in a statement on 25 September.

The company had also added that the Association for Fish workers' Rights – the Machimar Adhikar Sangharsh Sangathan (MASS) -- has certain generic issues concerning the coastline of Gujarat, Mundra UMPP is just about 1% of Kutch coastline and that it is more than responsive in its association with the community around our project.

IFC has invested $450 million of its own capital in the Category-A project which signifies that according to IFC there are potentially significant adverse social and environmental impacts that may be diverse or irreversible. The IFC was also considering investing up to $50 million in equity as part of its exposure to the project and syndicating up to about $300 million in loans.

The complaint by MASS questioned the quality of the environmental and social impact assessment and the company‘s community consultation activities, the project‘s adherence to IFC‘s performance standards and its compliance with national legislation. The CAO found, in its audit initiated in August last year, that evidence validated the complaint.

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NEEPCO to execute Kurung Kumey Hydro Power project...

 

NEEPCO hydro

The Arunachal Pradesh government has allocated the 330 MW Kurung Kumey Hydro Power project to the North East Electrical Power Corporation (NEEPCO) for execution.

The state cabinet in its meeting on November 1 also approved setting up of a Gas Power Plant at Miao in Changlang district and a Nursing College at the state capital, official sources said here today.

It further approved the launching of Chief Minister's Health Insurance Scheme and CM's Trophy events for Football and Volleyball for both girls and boys, they added.

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Exempt UMPP from compensatory afforestation clause, says power ministry...

 

ultra mega power project aforestation

The power ministry plans to give a shot in the arm for ultra mega power projects and has approached the Cabinet to exempt the plants from a key provision of the Forests Act, 1980, that requires companies to identify land for mandatory compensatory afforestation.

To facilitate this, the ministry has approached the Cabinet Committee on Infrastructure seeking 'central government' status for ultra mega power projects for the purpose of acquiring forestland. Under the current system, unlike private developers, central government projects are not required to identify non-forest land for compensatory afforestation or pay any money for the purpose.

Exempt UMPP from compensatory afforestation clause, says power ministry The existing provision helps state companies such as NTPC to develop projects smoothly, but private firms face numerous obstacles in securing approvals and clearances required for identifying the appropriate patch of land to plant trees in lieu of forest land that a project needs. The power ministry wants now wants the same provision to be applied to all companies. However, the power ministry has proposed that developers of ultra mega power projects be asked to pay for afforestation although state governments should identify the non-forest land.

"We have approached the Cabinet Committee on Infrastructure for tweaking the compensatory afforestation norms for the Tilaiya ultra mega power project in Jharkhand. If approved, the change would benefit both existing and future ultra mega power projects," a senior power ministry official said.

Compensatory afforestation rule is one of the most important conditions stipulated by the central government under the forest conservation Act while diverting forestland and requires companies to identify an equal area of non-forest land in the same state.

The proposal is part of the government's efforts to revive investment and clear obstacles that have stalled giant projects such as UMPPs. Reliance Power bagged the 3,960 mw ultra mega power project at Tilaiya in 2009 and planned to commission the first unit by May 2015. The company has not been able to start work as the state government has not handed over land to the company. The company has received forest clearance for 1,220 acres of forest land but is still awaiting final handover from the state government.

Nearly 80% of land required for the project and attached coal mines fall under forest area. Reliance Power had ordered the main plant equipment for the Tilaiya project from China's Shanghai Electric, but is still in discussions with domestic and international banks for financial closure. The proposal would also benefit developers of future ultra mega power projects. The government has called bids for two such projects at Bedhabahal in Orissa and Cheyyur in Tamil Nadu.

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