Distributed PV Generation and the Role of Utilities

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Distributed PV Generation and the Role of Utilities

Dr. Omkar Jani

Principal Research Scientist (Solar), GERMI

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Seminar on Net-Zero Energy Buildings (NZEBs) in India

New Delhi, INDIA

17 May 2013

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Outline

GERMI’s first project.

Case: 5 MW Gandhinagar PV Rooftop Programme

Possible PV techno-commercial models

DisCom’s approach

Net-metering financial case studies

Proposed rooftop solar policy and implications

Comments

"Distributed PV Generation and the Role of Utilities," Seminar on NZEBs in India, New Delhi, 17 May 2013. 2

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GERMI’s First Project


1-Week Energy Generation and Consumption data

at Auditorium Building, PDPU.

Courtesy: Ecolibrium Net Zero Energy Building

Demonstration:o An attempt to meet the

University Auditorium Building’s using solar.

“Is this building running on solar?”o NO!!! Better!o No batterieso No over-sizing redundancyo Will power others too.

Meets 50% of the building load.

Paved way for the 5 MW Gandhinagar PV Rooftop Programme.

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Typical 2-Meter PV System Architecture


Photovoltaic Modules

(Approx. 1 – 100 kWP)

Grid-tied

inverter Meter 2: Solar Electricity

Generation

Meter 1: Conventional

Electricity ConsumptionTransformer Grid

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Advantages of PV System Architecture


Relatively simple to install, operate and maintain.

Most popular and globally accepted configuration.

Disadvantage: No availability when grid is down.

Meter 1: Conventional

Electricity ConsumptionTransformer Grid

Photovoltaic Modules

(Approx. 1 - 100kWP)

Grid-tied

inverter Meter 2: Solar Electricity

Generation

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5 MW Gandhinagar Rooftop Solar Programme


Rooftop Solar Project

Developer

DisCom (Torrent Power)

GPCL (Govt. Agency)

for Viability Gap Funding

Rooftop/ Terrace Owner

Power Purchase Agreement (PPA)

Tariff determined by Regulator

Rooftop Lease Agreement

@ Rs. 3/- per kWh

Project Implementation

Agreement (PIA)

Quoted Tariff

Regulator’s Tariff VGF

Realized Tariff Rent

The Maths!

11.21

8.21 3.00

0.0711.14

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PV Connectivity Options: No PV

A typical electrical connection to a building…


GRIDX’FORMERBUILDING CAMPUSMeter 1

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PV Connectivity Options: 2-Meter PV System

Technical Requirement:o Grid availability should be high.

Business Model:o Payback achieved through sale of power to the Grid.o Preferential feed-in tariff higher than conventional tariff.


GRIDX’FORMERBUILDING CAMPUS

Meter 2

Meter 1

PV Modules Grid-Tied Inverter

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PV Connectivity Options: Net-Metering System

Technical Requirement:o Grid availability should be high.

Business Model:o Payback achieved through savings in net-energy consumption.o Parity in solar and conventional tariff achieved by capital subsidy.o Generation-based subsidy also possible.


GRIDX’FORMERBUILDING CAMPUSNet Meter

PV Modules Grid-Tied Inverter

Generation

Meter

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PV Connectivity Options: Net-Metering System

Technical Requirement:o Should be used where grid is not available.

Business Model:o Payback achieved through utilization of energy.o High capital costs need to be supported with capital subsidies.o May be a good option for Utility to support if connectivity cost is high.


GRIDBUILDING CAMPUSMeter

PV Modules Stand-Alone Inverter

Battery

Bank

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PV Connectivity Options: Hybrid Net-Metering

Technical Requirement:o Should be used where grid-availability is low.

Business Model:o Payback achieved through savings in net-energy consumption.o Parity in solar and conventional tariff achieved by capital subsidy.o Towards a micro-grid concept…


GRIDX’FORMERBUILDING CAMPUSNet Meter

PV Modules

PCU

Battery

Bank

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Question in mind of the Utility

Do we need to buy additional power? Do we have any unfulfilled RPO?

What is the cost to us for supporting distributed generation?o One-time cost of capital subsidy?o Long-term cost of feed-in tariff?o Reduced revenue by not selling power? Losing Business?

Will my grid be able to handle the distributed power injection? (Today, YES)

Will my grid be able to commercially support the distributed power injection? (Ref. Grid Availability)

Can this power be predicated and scheduled? (Smart-grid)

What capacities do I need to handle the distributed power injection? Technical and Commercial?


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Case Study: 5 kW Residential Consumer


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Consumer Cash Flow


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DisCom Cash Flow


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Case Study: A Typical Urban Residential (RGP) Customer


Consumer Data (before installing PV) DisCom Data

Contract Load : 5 kW Realization Cost : Rs. 5.17 /kWh

Load Factor : 12% Cost to Serve : Rs. 5.69 /kWh

Units Consumed : 438 kWh/ mo Profit from Sale : Rs. (-0.52) /kWh

Monthly Elect. Bill : Rs. 2,604 /mo T&D Improvement : 5%

PV System

PV Capacity : 5 kW System Cost : Rs. 4.00 Lacs

Subsidy : 60% Cost to Customer : Rs. 1.60 Lacs

Generation/ Month : 675 kWh/ mo Generation/ Year : 8,103 kWh/ yr

Consumer Results (after installing PV)

First Month Elect. Bill : Rs. (-622)/- Investment IRR : 28.12%

Breakeven Period : 3.90 years Investment NPV : Rs. 2.63 Lacs

DisCom Results (after installing PV)

Annual DisCom Reduc. : Rs. (-848)/- NPV Reduc. (25 yrs) : Rs. (-21,210)/-

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Case Study: A Typical Low/ Medium Commercial/ Industrial (LMTD) Customer



Contract Demand : 50 kW Realization Cost : Rs. 5.22 /kWh


Units Consumed : 10,950 kWh/ mo Profit from Sale : Rs. 0.73 /kWh

Monthly Elect. Bill : Rs. 62,886 /mo T&D Improvement : 5%

PV System

PV Capacity : 60 kW System Cost : Rs. 45.00 Lacs

Subsidy : 30% Cost to Customer : Rs. 31.5 Lacs

Generation/ Month : 8,103 kWh/ mo Generation/ Year : 97,236 kWh/ yr


First Month Elect. Bill : Rs. 21,2376/- Investment IRR : 19.31%

Breakeven Period : 5.41 years Investment NPV : Rs. 21.64 Lac


Annual DisCom Reduc. : Rs. 17,249/- NPV Reduc. (25 yrs) : Rs. 4,31,231/-

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Case Study: A Typical High-Tension Industrial (HTP) Customer



Contract Demand : 500 kVA Realization Cost : Rs. 5.52 /kWh


Units Consumed : 1,46,000 kWh/ mo Profit from Sale : Rs. 1.03 /kWh

Monthly Elect. Bill : Rs. 9,26,969 /mo T&D Improvement : 5%

PV System

PV Capacity : 600 kW System Cost : Rs. 420 Lacs

Subsidy : 0% Cost to Customer : Rs. 420 Lacs

Generation/ Month : 81,030 kWh/ mo Generation/ Year : 972,360 kWh/ mo


First Month Elect. Bill : Rs. 4,63,205/- Investment IRR : 15.83%

Breakeven Period : 6.55 years Investment NPV : Rs. 166 Lacs


Annual DisCom Reduc. : Rs. 2,65,848/- NPV Reduc. (25 yrs) : Rs. 66,46,194/-

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Evolution of PV Generation w.r.t. End Use


Source: International Energy Agency (IEA)

63%19%

11%

7%

56%23%

12%

10%

51%26%

11%

12%

47%27%

12%

13%

44%29%

13%

15%

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Utility Scale and Rooftop Solar Share


11,252 MW

RPO: 7.75%

CAGR: 33%

Utility Scale Solar Share (MW)

Rooftop Solar Share (MW)

Ro

bu

st

Ro

oft

op

So

lar

Po

licy

Cumulative: 3,613 MW

CAGR: 83%

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Proposed Rooftop Solar Policy: Purpose

Fact: The viability gap for rooftop solar is diminishing.o Certain segments have already approached grid parity.

Fact: All entities are inherently capable of generating their own energy through solar. (Threat to DisComs?)o There is a growing number of inquiries for setting up rooftop solar PV.

Hence, a FRAMEWORK needs to be established through which such installations can be executed.o To avoid randomness and mismanagement.o Establish framework when (rooftop solar) demand is low.o Incentives are only a SECONDARY mechanism to ensure viability.


Vision:

Make each consumer self-sufficient for Energy (Electricity).

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Objectives: The Policy should…

Promote distributed generation through the Citizen User.

Take advantage of reducing cost of solar energy.

Streamline administrative approvals/ processes for connecting rooftop PV systems.

Trigger conducive designs for higher roof/ terrace area utilization.

Promote local manufacturing and employment.

Catalyze novel smart-grid and energy storage technologies.

Discover the real cost of distributed generation.


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Case Scenario: 300 MW in 3 Years


2013-14 2014-15 2015-16

Policy Target: 300 MW 60 MW 90 MW 150 MW

Distribution…

Residential (33%) 20 MW 30 MW 50 MW

LT/ MT (33%) 20 MW 30 MW 50 MW

HT Indus. (33%) 20 MW 30 MW 50 MW

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Cost to DisCom


Year 2014 2015 2016

Annual Rooftop Installation (MW) 60 90 150

Residential Capacity (33%) (MW) 20 30 50

Cost to DisCom (Rs. Cr.) -0.34 -0.51 -0.85

LT/ MT Capacity (33%) 20 30 50

Cost to DisCom (Rs. Cr.) 0.69 1.03 1.72

HT Industrial Capacity (33%) 20 30 50

Cost to DisCom (Rs. Cr.) 1.06 1.60 2.66

Net Cum. Cost to DisCom (Rs. Cr.) 1.41 3.54 7.07

Baseline DisCom Revenue (Rs. Cr.) 23,091 23,784 24,497

Relative Reduction in Revenue 0.01% 0.01% 0.03%

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Concluding remarks…

Solar is an obvious inclusion in Net-Zero Energy Buildings.

Business model for Distributed PV (and NZEB) should be selected through techno-commercial due diligence.

The cost to Utilities should be respected for the long run.

NZEB and DMS technologies can piggyback on the Solar Investment.


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Distributed PV Generation and the Role of Utilities

Dr. Omkar Jani

Principal Research Scientist (Solar), GERMI

[email protected]

Seminar on Net-Zero Energy Buildings (NZEBs) in India

New Delhi, INDIA

17 May 2013

Distributed PV Generation and the Role of Utilities

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