Update on Power Generation during March 2012 by Gujarat Solar Power Projects….

Power India found that around 32 Solar Power Project Developers of Gujarat have started producing the sola energy and feeding the same to the Gujarat Grid.

 

Further, the State Load Dispatch Centre (SLDC) of Gujarat have in its month Energy Accounts of March 2012 captured the generation from these solar plants.

 

As estimated by Gujarat SLDC,

• Total Export: 1181.35 MWhs
• Total Import: 919.63 MWhs
• Net Solar Energy Generation: 70261.73 MWhs

 

Developer wise break-up shall be as below:

Sr. No.	Name of Power Station	Energy Exported (MWH)	Energy Import (MWH)
1	Lanco	2,516.95	24.49
2	Solitaire	2,365.00	-
3	Precious	2,349.20	18.80
4	Azure Power	1,848.00	5.80
5	Sun Edison	102.98	1.08
6	Welspun	3,034.50	25.00
7	Green infra	1,704.70	13.50
8	Aravali infra	573.10	10.70
9	66kv Vadgam(Azure,ESP,Visual,Millenium,Emco)	7,232.00	72.00
10	BITA Solar Power	6,657.10	47.86
11	Konark	926.80	6.50
12	Backbone	829.05	8.85
13	ICML	1,228.10	10.25
14	TATA(Mithapur)	4,259.30	30.05
15	GHI (Helabeli)	1,735.70	12.10
16	Rasana	296.48	3.99
17	Rajesh	155.47	0.09
18	MBH solar	87.71	0.02
19	GIPCL	731.48	2.34
20	Essar	152.45	1.17
21	Louroux	2,125.20	262.20
22	Waa Solar	1,880.00	11.00
23	PLG	2,836.00	19.40
24	Thavar	560.50	26.29
25	Charanka SolarPark	21,866.91	328.14
26	Jai Hind	401.79	0.36
27	ACME Solar	670.80	4.80
28	ACME Solar	676.00	11.20
29	Harsha	440.46	5.02
30	PDPU	161.85	-
31	Abellon Cleanenergy Ltd.	440.54	3.06
32	Universal Solar	335.24	-
		71,181.35	919.63

 

 

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More Literature on this topic:

• http://urvishdave.wordpress.com/2012/05/08/gujarat-solar-projects-generation-data-for-march-2012/
• http://www.sldcguj.com/energyaccount/energy_account_new.asp

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Wind Incentives–Do we need Tax Incentive on Project Cost or Electricity Produced…

Power India has done a study on the comparative analysis of two major incentives being given to Wind Projects – Accelerated Depreciation and Generation Based Incentives.

 

Background

• Although the Accelerated Depreciation (AD) Scheme contributed more to make India’s wind installation globally one of the largest with 15,000 MW however the same was also a reason for poor quality of projects leading to lower generation.
• Under AD Scheme, developers were able to get 80% depreciation benefit (against the normal rate of 15%) in the initial years only which was causing them to focus little on Plant Load Factor (PLF), Machine Availability, Actual Generation, Losses and other quality aspects of the Project.
• Due to this despite having large capacity of wind projects, India’s actual wind power generation is very poor.
• Although, Accelerated Depreciation benefit for Wind Projects has been withdrawn by Income Tax Department on 30^th March 2012[1], have since been conflicting reports that it would be revived.

 

We are giving a snapshot of the comparison between the AD Scheme & GBI Scheme.

 

1. Current major Initiatives

a. Accelerated Depreciation

• Government of India (“GoI”) had introduced Accelerated Depreciation scheme (“AD Scheme”) in mid nineties.
• Wind energy producer were entitled to claim up to 80% accelerated depreciation in the first year itself.
• Over the years AD was the major driver for the development of the wind industry in the country.

 b. Generation Based Incentive

• MNRE has introduced a Generation Based Incentive scheme (“GBI Scheme”) on 17^th December 2009.
• GBI Scheme entitles the wind energy producer to get Rs. 0.50/unit (over and above the tariff) of electricity produced for the first 10 years of project life subject to maximum cap of Rs. 62 Lacs/MW.
• The scheme was can be availed only if AD Scheme has not been availed. Further, the maximum capacity of the projects under this scheme was capped at 4000 MW and was applicable for the projects commissioned till 31^st March 2012.
• It is expected that extending the validity and incentives of GBI Scheme is under consideration however; currently no official notification to this effect has been published.

2. AD Scheme (Key driver):

• Ownership of wind assets appeared more attractive for a “diversified” corporate taxpayer, being eligible for an Accelerated Depreciation (80%/40%) of the cost of the asset (in the initial years of operation), with equity financing of only 30%.
• As a consequence, functionality of the wind asset came to be determined by the tax absorption capacity of the corporate, rather than aspects such as optimal capacity of the wind farm, prospective revenue stream etc.
• However, for Independent Power Producers (IPPs) the extant scheme only offers a marginal benefit, since the entire depreciation needs to be absorbed within 5 years of commissioning, for the income-tax holiday to be fully availed.

3. Current Mix – AD vs IPPs:

• Historically 80%-90% of wind projects being installed in India are under AD Scheme due to the higher profitability of wind energy projects considering the benefits of AD Scheme.
• According to recent data of IREDA[2], the registering authority of AD Scheme, ~1300 MW of Wind Projects have been registered under AD Scheme out of the total installations of ~3600 MW during the period 2010-11 & 2011-12.
• During recent years, large IPPs started setting up wind projects and share of AD has gone down. The current market share of wind projects under AD Scheme is roughly ~40%.

4. Impact of removal of AD benefits:

• Wind Projects to be installed after 31^st March 2012, will not be able to take benefits of AD Scheme.
• IT Depreciation is reduced to 15% from the earlier level of 80%, which is in line with the other projects. This will take away the entire AD Scheme driven market of ~40%.
• Last FY (2011-12) Wind installations were in the range of 3200 MWs (around 40% were expected to be from AD market). These customers unlikely to be interested in the wind projects any more. GBI Scheme which was mutually exclusive to AD has also expired on 31^st Mar 2012.
• It is expected that Wind Industry will take a hit on this and expected installations next FY will be restricted to ~ 2000 MW only.
• However, quality of projects (i.e. size of wind farms, capacity of machines) are expected to increase going forward as only serious players will going to be in the wind business.

 

---

[1] Notification No. 15/2012 [F.No.149/21/2010-SO(TPL)] Dated 30-3-2012

[2] IREDA has started issuing unique identification nos to the registered WTGs under AD Scheme from the end 2009.

 

 

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More Literature on this topic:

• http://economictimes.indiatimes.com/opinion/editorial/wind-power-needs-a-tax-incentive-on-the-power-produced/articleshow/13060155.cms

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Power Trading Update – 17th January 2012

 

Power Trading snapshots of two major exchanges  IEX (Indian Energy Exchange) and PXI (Power Exchange of India) for 17th January 2012.

 

 

 

Market Snapshot on IEX

 

Category	Purchase Bid (MWh)	Sell Bid (MWh)	Unconstrained MCV(MWh)	Constrained MCV (MWh)	Unconstrained MCP(Rs/MWh)
Total	51319.5	58891.5	37284.9	32770.8	-
Max	2835.2	3371.8	1837.0	1691.6	4100.5
Min	1715.6	1697.1	1140.1	993.4	2058.5
Average	2138.3	2453.8	1553.5	1365.5	3009.6

Market Snapshot on PXI

Category	Purchase Bid (MWh)	Sell Bid (MWh)	Unconstrained MCV(MWh)	Constrained MCV (MWh)	Unconstrained MCP(Rs/MWh)
Total	1826.4	4614.0	1069.7	606.9	--
Max	87.6	272.0	79.8	40.4	4990.0
Min	56.6	50.0	1.5	0.2	2490.0
Average	76.1	192.3	44.6	25.3	3365.4

Legends:

• MCV : Market Clearance Volume
• MCP: Market Clearance Price

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Power Trading Update – 15th January 2012

Power Trading snapshots of two major exchanges  IEX (Indian Energy Exchange) and PXI (Power Exchange of India) for 15th January 2012.

 

 

 

Market Snapshot on IEX

Category	Purchase Bid (MWh)	Sell Bid (MWh)	Unconstrained MCV(MWh)	Constrained MCV (MWh)	Unconstrained MCP(Rs/MWh)
Total	55968.5	69560.0	39186.3	34918.1	-
Max	3578.8	3552.7	2380.3	1736.8	3501
Min	1735.1	2428.4	1271.5	1283.5	1769.6
Average	2332.0	2898.3	1632.8	1454.9	2906.08

Market Snapshot on PXI

Category	Purchase Bid (MWh)	Sell Bid (MWh)	Unconstrained MCV(MWh)	Constrained MCV (MWh)	Unconstrained MCP(Rs/MWh)
Total	2290.2	11865.9	2077.9	1013.4	--
Max	133.8	655.9	133.8	63.92	3250
Min	59.06	355.9	52	23.29	2010
Average	95.43	494.41	86.58	42.23	2771.25

Legends:

• MCV : Market Clearance Volume
• MCP: Market Clearance Price

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Power Trading Update – 13th January 2012

Power Trading snapshots of two major exchanges  IEX (Indian Energy Exchange) and PXI (Power Exchange of India) for 13th January 2012. On IEX around 56801 Mn Units were sold as against demand of 77317 Mn Units. Similarly on PXI around 3556 Mn Units were sold as against demand of 8233 Mn Units. Detailed report of both the exchanges are depicted below:

 

 

Market Snapshot on IEX

Category	Purchase Bid (MWh)	Sell Bid (MWh)	Unconstrained MCV(MWh)	Constrained MCV (MWh)	Unconstrained MCP(Rs/MWh)
Total	77316.7	56801.4	44278.5	34853.6	-
Max	4159.9	3275.1	2411.1	1747.1	4515.08
Min	2633.5	1696.5	1435.6	1182.9	2989.9
Average	3221.5	2366.7	1844.9	1452.2	3685.22

 

Market Snapshot on PXI

Category	Purchase Bid (MWh)	Sell Bid (MWh)	Unconstrained MCV(MWh)	Constrained MCV (MWh)	Unconstrained MCP(Rs/MWh)
Total	8233.1	3556.3	1855.5	730.3	--
Max	323.8	52.0	4.2	2.6	3430.0
Min	353.3	247.0	237.0	72.0	5990.0
Average	343.0	148.2	77.3	30.4	4264.6

Legends:

• MCV : Market Clearance Volume
• MCP: Market Clearance Price

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Renewable Energy Certificates (REC) trading update of December 2011…

Renewable Energy Certificates (REC) are being traded on last Wednesday of every month on the Indian Power Exchanges like IEX and PXI.

The last REC trading were happened on 26th December 2011.

Following is the snapshot of the last REC Trading on IEX.

No of Participants as on 31st December 2011.

	No of Participants
Total registered Participants	689
Obligated Entities
DISCOMs	10
Open Access consumers	497
Captive Consumers	23
Voluntary Entities	4
Eligible Entity (Private Generators)	155
Highest Participation in REC Auctions (Sep’11)	168

 

REC bids and price

	Purchase Bids (REC)	Sell Bids (REC)	Cleared (REC)	Price (Rs./REC)
Non-Solar	264093	166000	105942	2950
Solar	495	0	0	0
1 REC = 1 MWh

History of REC Trading

REC Trade analysis

 

Next REC Trading session will be held on 25th January 2012.

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Power Trading Update – 12th Jan 2012

Power Trading snapshots of two major exchanges  IEX (Indian Energy Exchange) and PXI (Power Exchange of India) for 12th January 2012. On IEX around 59740 Mn Units were sold as against demand of 69750 Mn Units. Similarly on PXI around 2356 Mn Units were sold as against demand of 5120 Mn Units. Detailed report of both the exchanges are depicted below:

 

 

 

Market Snapshot on IEX

Category	Purchase Bid (MWh)	Sell Bid (MWh)	Unconstrained MCV(MWh)	Constrained MCV (MWh)	Unconstrained MCP(Rs/MWh)
Total	69750.2	59740.4	44833.2	38881.7	0.0
Max	3817.2	2959.4	2117.0	1948.5	4049.9
Min	2206.6	2090.4	1363.0	1280.7	2092.9
Average	2906.3	2489.2	1868.1	1620.1	3314.8

 

Market Snapshot on PXI

Category	Purchase Bid (MWh)	Sell Bid (MWh)	Unconstrained MCV(MWh)	Constrained MCV (MWh)	Unconstrained MCP(Rs/MWh)
Total	5119.9	2355.9	1075.2	719.8	0.0
Max	254.5	135.9	102.0	61.6	7010.0
Min	175.3	62.0	2.0	2.0	3250.0
Average	213.3	98.2	44.8	30.0	4313.3

Legends:

• MCV : Market Clearance Volume
• MCP: Market Clearance Price

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Power Trading update – 10th Jan 2012

Power Trading snapshots of two major exchanges  IEX (Indian Energy Exchange) and PXI (Power Exchange of India) for 10th January 2012. On IEX around 52544 Mn Units were sold as against demand of 68071 Mn Units. Similarly on PXI around 3461 Mn Units were sold as against demand of 4742 Mn Units. Detailed report of both the exchanges are depicted below:

 

 

 

Market Snapshot on IEX

Category	Purchase Bid (MWh)	Sell Bid (MWh)	Unconstrained MCV(MWh)	Constrained MCV (MWh)	Unconstrained MCP(Rs/MWh)
Total	68070.9	52544.5	37529.09	31219.87	-
Max	3926.7	3316.9	1961.2	1662.7	4588.85
Min	1994.4	1409	934.2	862	1769.15
Average	2836.29	2189.35	1563.71	1300.83	3411.71

Market Snapshot on PXI

Category	Purchase Bid (MWh)	Sell Bid (MWh)	Unconstrained MCV(MWh)	Constrained MCV (MWh)	Unconstrained MCP(Rs/MWh)
Total	4742.81	3461.39	1490.56	837.41	--
Max	247.72	272	117	63.56	7010
Min	170.51	64.81	4.81	4.81	2800
Average	197.62	144.22	62.11	34.89	3811.25

Legends:

• MCV : Market Clearance Volume
• MCP: Market Clearance Price

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FY12 Wind based capacity addition to be 2800 MW…

ICRA has published a Press Release on 10th January 2012, predicting the wind based capacity addition during the FY 2011 – 12 and thereafter. As per the ICRA, the wind based capacity addition during the current FY be around 2800 MW as against the 2350 MW during last FY. The same may grow at an annual rate of 15% going forward.

 

The key drivers of the wind based capacity addition are (i) growing demand from Independent Power Producer (IPP) segments (ii) commencement of trading of Renewable Energy Certificates (REC) on Power Exchanges as well as long-term certainty over the floor/cap pricing mechanism of REC.

 

Further, according to ICRA, the spiraling international cost of conventional energy sources and persistent domestic fuel shortages make wind energy more cost-competitive. 

The new wind-based projects/IPPs may prefer the REC route against the preferential tariff route, and within the REC route, many IPPs would prefer to sign their power purchase agreements (PPAs) with discoms at their average power purchase cost (APPC) instead of selling on merchant/short-term basis. This is due to open-access and banking facility constraints and volatility in merchant tariffs, although the merchant option under the REC route is the most remunerative option available.

According to ICRA, following issues could adversely affect the capacity addition of wind projects.

• Implementation issues in complying with Renewable energy Portfolio Obligation (RPO) norms due to lack of consistency and a wide divergence in RPO norms across states, risk of any amendment in RPO norms by SERC (as observed in few states), no precedence of any enforcement of penalty on obligated entities† for shortfall in RPO & absence of regular monitoring of RPO compliance by state agencies
• The counter-party credit risks of state utilities in most of the states having wind energy potential have increased significantly as evident from persisting defaults to wind mills in the states of Tamil Nadu and Rajasthan.
• Execution risks associated with strengthening of the intra-state transmission network beyond the inter-connection point remains a challenge for the utilities across the states, also given their weak financial position
• With respect to tariff regulations, implementation of wind-zone specific tariffs (as devised by CERC in its generic tariff principles) remains uncertain in Maharashtra, which is the first state to adopt such tariffs. On the other hand, preferential tariffs continue to vary across the states, and remain fixed for a longer control period which could impact the returns of new projects commissioned

 

Free download of the Report

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Power Trading update – 9th Jan 2012

Power Trading snapshots of two major exchanges  IEX (Indian Energy Exchange) and PXI (Power Exchange of India) for 9th January 2012. On IEX around 52544 Mn Units were sold as against demand of 68071 Mn Units. Similarly on PXI around 3974 Mn Units were sold as against demand of 4419 Mn Units. Detailed report of both the exchanges are depicted below:

 

 

 

Market Snapshot on IEX

Category	Purchase Bid (MWh)	Sell Bid (MWh)	Unconstrained MCV(MWh)	Constrained MCV (MWh)	Unconstrained MCP(Rs/MWh)
Total	68070.9	52544.5	37529.09	31219.87	-
Max	3926.7	3316.9	1961.2	1662.7	4588.85
Min	1994.4	1409	934.2	862	1769.15
Average	2836.29	2189.35	1563.71	1300.83	3411.71

 

Market Snapshot on PXI

Category	Purchase Bid (MWh)	Sell Bid (MWh)	Unconstrained MCV(MWh)	Constrained MCV (MWh)	Unconstrained MCP(Rs/MWh)
Total	4418.85	3974.39	1059.49	599.6	--
Max	252.07	267	129.81	53.74	7010
Min	65.53	75.81	12.07	7.35	2060
Average	184.12	165.6	44.15	24.98	3952.5

 

Legends:

• MCV : Market Clearance Volume
• MCP: Market Clearance Price

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Monthly Highlights of Indian Power Sector – Nov 11

All India installed capacity at the end of November 2011 (1,85,497 MW):

• Thermal
  • Coal : 1,02,863 MW (56% of total)
  • Gas : 17742 MW (9.6% of total)
  • Diesel : 1200 MW (0.6% of total)
• Nuclear : 4780 MW (2.6% of total)
• Hydro: 38748.4 MW (11 % of total)
• Other Renewable: 20162 MW (11% of total) (Based on 30.06.2011)

Total Electricity Generation till November 2011.

• Thermal       : 4,53,837 MUs (Target – 7,12,234 MUs)
• Hydro           : 1,00,565 MUs (Target – 1,12,050 MUs)
• Nuclear        : 21,206 MUs (Target – 25130 MUs)

All India Thermal PLF: 71.58% (Till Nov 11)

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