Workshop on “Challenges and Issues in Solar RPO Compliance ... · Workshop on “Challenges and...
Transcript of Workshop on “Challenges and Issues in Solar RPO Compliance ... · Workshop on “Challenges and...
AF-Mercados EMI
Current Trends/Status in Solar Power Market
Workshop on “Challenges and Issues in Solar RPO
Compliance/RECs”
Hyderabad
May 23, 2013
Anish De
ÅF-Mercados EMI
AF-Mercados EMI
Current Installed Capacity and Power Supply Position: Persistent Deficits In A Changing Supply Mix
In
sta
lled
C
ap
acity (M
W)
Thermal Renewable Hydro Nuclear
The current capacity stands at around 223 GW
Generation mix continues to be following a flat
trend for the past four years with coal being the
dominant source
Coal accounts for about 56%,Hydro around 18%,
and Gas around 9% of the total installed capacity
Share of renewables have increased over the past,
from 2% in 2003-04 to 6% in 2006-07 and now to
12% in 2012-13
(De
ficit %
) (D
efic
it %)
The country is in an overall deficit.
North Eastern, Western, and Southern region
experience larger regional imbalances.
2
All India Installed Capacity (as of 31st March
2013): Technology Break Up
AF-Mercados EMI
Solar Resource in India
Among the various renewable energy
resources, solar energy potential is
the highest in the country.
The equivalent energy potential is
about 6,000 million GWh of energy
per year. As compared to this, the
present level of generation of electricity
in 2008-09 from all resources was 0.7
million GWh.
The states that have the maximum
insolation are Rajasthan and Gujarat.
In addition, the states of Tamil Nadu,
Andhra Pradesh, Madhya Pradesh,
Maharashtra and Chhattisgarh also
enjoy good insolation levels.
Most of these states are in regions
where the unmet electricity demand
as well as the growth in demand for
electricity is high
3
AF-Mercados EMI
2.11 2.12 2.12 10.28 35.15
941.24
1645.61
0
200
400
600
800
1000
1200
1400
1600
1800
2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13
MW
Year Solar Installed capacity (MW)
Cumulative Capacity Addition of Solar Power
Sr. No. States
Installed
Capacity * (MW)
1 Andhra Pradesh 23.15
2 Arunachal Pradesh 0.025
3 Chhattisgarh 4
4 Delhi 2.525
5 Goa & UT 1.685
6 Gujarat 824.09 7 Haryana 7.8
8 Jharkhand 16
9 Karnataka 14
10 Kerala 0.025
11 Madhya Pradesh 11.75
12 Maharashtra 164.5
13 Odisha 13
14 Punjab 9.325
15 Rajasthan 517.25 16 Tamil Nadu 17.055
17 Uttarakhand 5.05
18 Uttar Pradesh 12.375
19 West Bengal 2
Total 1645.605
Note : The data is compiled on the basis of
information obtained from IREDA, NVVN, State
Agencies and Project Developers
Several states such as Gujarat, Rajasthan, Tamil Nadu, Chhattisgarh, Andhra Pradesh, Orissa, Uttar
Pradesh, Madhya Pradesh, Kerala have come up with solar Policies to promote solar power in
respective states
EA 2003 : NEP (2005) and NTP (2006)
NAPCC:15% RPO by 2022
Provision for SPO in NTP(3% solar)
NSM Phase -I, Batch – 2, Solar REC based projects
NSM Phase – 1, Batch – 1, Projects under Gujarat Solar Policy
* As on 30th April 2013
4
AF-Mercados EMI
Current solar power business models
5
During Phase – II of NSM, Viability Gap Funding for solar power is being introduced. SECI will
invite Expression of Interest from DISCOMs and will procure power from sellers and sell to
DISCOMS with a trading margin.
Solar
Power
Plant
Solar
Roof-
Top
Solar
Radiation Electricity
Generation
NVVN
Utility/
Consumer
Px /
Traders
Merchant Sale
Market Price + REC
Sale to Utility Bundled
Power
(i) FiT + GBI (PPA) (ii) APPC+ REC (iii) Bid (iv) Captive
Sale through state policy or REC route
Utility
Consumer
/ Third
Party Sale
Surplus power sale to utility + REC (if grid connected)
Power from utility
Net metering
Surplus power sale to Third party+ REC (if grid
connected)
PPA Price Surplus power post self
consumption can be injected into
the grid
NVVN
AF-Mercados EMI
Initiatives for Solar capacity addition
6
Capacity Addition
NVVN Bidding
~ 446 MW
Migration Scheme
~ 53 MW
RSSPV (GBI
Scheme)
~ 91.8 MW
State Policies
~ 829 MW
Other schemes
~108 MW
REC Scheme
~118 MW
Total
~1645 MW (as on 30th April 2013)
National Solar Mission*
* Refer to
Annexure I
AF-Mercados EMI
National level Solar RPO Target
7
Tariff Policy stipulates SPO target of 0.25 % by 2013, which will increase to
3% by 2022.
Source: Demand as per CEA Power Supply Position 2012-13, Growth rate as per 18th EPS
CUF based on CERC norms are used to arrive at MW capacity
Year Solar RPO (%) Solar Capacity Requirement for RPO compliance
(MW)
2013-14 0.50% 3,197
2014-15 0.75% 5,165
2015-16 1.00% 7,420
2016-17 1.25% 9,994*
2017-18 1.75% 15,080
2018-19 2.25% 20,901
2019-20 2.50% 25,041
2020-21 2.75% 29,708
2021-22 3.00% 34,961
* Refer to Annexure
II for State wise
break-up
To achieve 3% RPO compliance by 2022, the country would need ~35,000MW of
solar capacity
AF-Mercados EMI
Case Study – Comparative Analysis for UP & AP
Parameters Uttar Pradesh
Andhra
Pradesh
Energy Requirement by 2017
(MU)
106,134
129,821
Energy Availability by 2017
(MU)
81,705
112,274
Gap (MU) (24429.25) (17547.11)
Gap(%) -23% -14%
Exceeding Solar Purchase Obligation (SPO) will
only help in bridging the demand supply gap.
Source: AF-Mercados EMI database
8
AF-Mercados EMI
Case Study – Comparative Analysis for UP & AP
Parameters Uttar Pradesh Andhra Pradesh
SPO target by 2017 (%) 1.25% 1.25%
SPO (MU) 1,326.67 1,622.76
SPO Requirement (MW) 797.09 974.98
Tie-up capacity achieved till date (MW) 93.38 77.7
Capacity in Pipeline under state policy** (MW) - -
Potential Allocation from Phase – 2 (MW) 285 314
Balance to be met (MW) 418.93 582.89
** Tendered capacities in UP 200 MW and AP 1000 MW; capacities not yet allocated in both states, hence not considered.
Inviting of bids by State Distribution Licensees as per the
State Policy
Procurement of Renewable Energy Certificates (RECs)
Direct compliance of RPO by Large Consumers (OA/Captive
users, HT Consumers)
Separate provisions for Green Tariff in state tariff orders
Solar Rooftop (subject to resolution of regulatory issues)
Means to bridge the
above gap
9
AF-Mercados EMI
Current state-wise SPO targets
10
There should be uniformity in RPO trajectory specified by different states.
Also, states need to set RPO targets as per tariff policy guidelines
States 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22
Andhra Pradesh 0.25% 0.25% 0.25% 0.25% 0.25%
Arunachal 0.10% 0.15% 0.20%
Assam 0.15% 0.20% 0.25%
Bihar 0.25% 0.50% 0.75% 1.00% 1.25% 1.50% 1.75% 2.00% 2.50% 3.00%
Chhattisgarh 0.50%
Delhi 0.15% 0.20% 0.25% 0.30% 0.35%
Gujarat* 1.00%
Haryana 0.05% 0.10%
Himachal Pradesh 0.25% 0.25% 0.25% 0.25% 0.25% 0.50% 0.75% 1.00% 2.00% 3.00%
Jammu Kashmir 0.25%
Goa & UT 0.40%
Jharkhand 1.00%
Karnataka* 0.25% 0.25% 0.25%
Kerala 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25%
Madhya Pradesh 0.60% 0.80% 1.00%
Maharashtra 0.25% 0.50% 0.50% 0.50%
Manipur 0.25%
Mizoram 0.25%
Meghalaya 0.40%
Nagaland 0.25%
Orissa 0.15% 0.20% 0.25% 0.30%
Punjab 0.07% 0.13% 0.19%
Rajasthan 0.75% 1.00%
Sikkim Not regulation issued for RPO by the Power Department
Tripura 0.10%
Tamil Nadu* 0.05%
Uttarakhand 0.05%
Uttar Pradesh* 1.00%
West Bengal 0.10% 0.15% 0.20% 0.25% 0.30%
> Tariff policy Target by 2013 < Tariff policy Target by 2013 = As per Tariff policy Target by 2013
* Same SPO level holds good unless notified
AF-Mercados EMI
SPO Compliance Status (2012-13) – Root of concern…….
11
High
Compliance
Low
Compliance
0.25%
(As per Tariff policy)
Andhra Pradesh
Assam
Bihar
High RPO Levels Low RPO Levels
Chhattisgarh
Delhi
Gujarat
Goa & UT
Haryana
HP J & K
Jharkhand
Karnataka
Kerala MP
Maharashtra
Orissa
Punjab
Rajasthan Uttarakhand
Tamil Nadu
Uttar Pradesh
West Bengal
100%
Compliance
Majority of
states
under low
compliance
Based on the tied up capacities by each state till 31st March 2013
AF-Mercados EMI
State RPO regulations – Few select states
State Regulations
Bihar If solar certificates are not available in a particular year, then in such cases,
additional non-solar certificate shall be purchased for fulfillment of the Renewable
Purchase Obligation (RPO).
Gujarat The RPO regulations are not applicable on captive as well as open access
consumers as their applicability is yet to be notified.
Karnataka A Generating Company opting for REC Scheme shall sell the electricity generated
by it to ESCOMs of the State at the pooled cost of power purchase
Punjab,
Maharashtra
,Jharkhand
They have allowed carry forward of RPO to subsequent years
12
The RPO regulations need to be harmonized as far as possible between
states to send out consistent messages and improve investment climate
State should provide for adequate provisions for solar purchase in their
ARRs Annexure IV
AF-Mercados EMI 13
Solar PV & Solar Thermal Cost & Tariff - Benchmark
This has resulted in reduction in benchmark tariffs as shown below:
Ben
ch
mark
Co
st
& T
ari
ffs
0.00
5.00
10.00
15.00
20.00
2010-11 2011-12 2012-13 2013-14
Rs C
r/M
W
FY
Cost of Solar PV & Solar Thermal
Solar PV Solar Thermal
Rs Cr/MW 2010-11 2011-12 2012-13 2013-14 Solar PV 15.2 14.42 10 8 Solar Thermal 14.2 15 13 12
Rs/Kwh 2010-11 2011-12 2012-13 2013-14
Solar PV 17.91 15.34 10.39 8.75
Solar Thermal 15.31 15.04 12.46 11.9
0.00
5.00
10.00
15.00
20.00
2010-11 2011-12 2012-13 2013-14
Rs./K
Wh
FY
Solar Tariff
Solar PV Solar Thermal
AF-Mercados EMI 14
Solar PV & Solar Thermal Tariff - Bidding
Introduction of
competitive bidding
has brought down
tariffs significantly, to
below the Solar REC
Floor price
State FiT
Karnataka
Madhya
Pradesh Orissa Gujarat Tamil Nadu
Andhra
Pradesh Rajasthan
Solar Thermal
(INR/kWh) 11.13 - - 11.55
Solar PV
(INR/kWh) 8.34 8.05 7 8.63 8.28* 6.49 6.45
CERC Tariff
(INR/kWh) 8.75 8.75 8.75 8.75 8.75 8.75 8.75
REC Floor Price
(INR/kWh) 9.3 9.3 9.3 9.3 9.3 9.3 9.3
* This is the first year tariff; INR 8.28 is the levelized tariff - TANGEDCO
*TANGEDCO has revised the tariff to 6.48/Kwh for first year which on Levelised basis works out to
be Rs 8.28 /Kwh (arrived at by considering current CERC discount rate of 13.10%)
6
6.5
7
7.5
8
8.5
9
9.5
Karnataka Madhya Pradesh
Orissa Gujarat Tamil Nadu Andhra Pradesh
Rajasthan
Rs./
Kwh
Solar PV (INR/kWh) CERC Tariff (INR/kWh) REC Floor Price (INR/kWh)
AF-Mercados EMI
Comparison of Solar Tariffs with Case-1 bids for Thermal Power
15
TN case 1 bid* UP Case 1 bid*
Min Tariff 4.84 4.48
Max Tariff 9.85 7.1
Wt average
Tariff
5.57 5.53
NSM-I
(Feb
2010)
NSM-II
(Feb
2011)
Karnataka
(Aug-11)
Rajasthan
(Nov-12)
TN (First year
Tariff);Dec-12
Andhra
Pradesh
(Dec-12)
VGF
Min Tariff 10.95 7.49 7.94 6.45 5.97 6.49
Max Tariff 12.76 9.44 8.5 8.45 17.95 10.98
Wt Av
Tariff
12.12 8.77 8.34 7.59 8.28* 6.49** 5.45
*TANGEDCO has revised the tariff to 6.48/Kwh for first year which on Levelised basis works out to
be Rs 8.28 /Kwh (arrived at by considering current CERC discount rate of 13.10%)
VGF proposes to bring it down to
level with conventional power
** AP has revised the tariff to Rs 6.49/Kwh on Levelised basis as asked the bidders to match it
Tariff for solar projects have reduced significantly over last 2 years
This should facilitate SPO compliance through purchase of power
*Refer
Annexure III
AF-Mercados EMI
REC framework has the ability to facilitate compliance by resource deficit states but faces implementation challenges………
16
Prices have come down - possible reasons :
Non-compliance of RPO/Lack of interest in REC
Further, unsold REC stocks have brought prices under pressure
1300012750
1280012850
12500
1268012720
1262012500 12500
13400
12206
11500
12000
12500
13000
13500
0
10000
20000
30000
40000
50000
May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13
No
. of
REC
s
Past Trend of the REC Market at IEX (Solar)
Buy Bid (REC) Sell Bid (REC) Total Volume Traded (REC) Clearing Price (Rs./REC)
AF-Mercados EMI
Solar REC Projects- Status and Challenges
States Capacity Accredited(MW)
No. of projects accredited
Capacity Registered (MW)**
No. of projects registered
Andhra Pradesh 5.75 1 5.75 - Chhattisgarh 2 1 2 1 Madhya Pradesh 36.225 40 24.33 23 Maharashtra 30.15 17 17.15 4 Odisha 3.5 2 - - Rajasthan 75.75 27 67.75 16 Tamil Nadu 1.055 1 1.055 1 Grand Total 157.43 90 118.035 45
Challenges
faced by REC
based projects
Lack of clarity on solar REC price post 2017
Solar REC Price higher than solar Feed-in-Tariff
Reducing trading volumes due to lack of compliance
Lack of clarity regarding applicability of REC mechanism for solar
rooftop installations
**All projects registered are commissioned.
17
AF-Mercados EMI
Current Status of REC Market (Solar & Non-solar)
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
80.0%
90.0%
100.0%
Participation Trend
Voluntary CPP Open Access Discom
Buyers : Largely distribution companies in terms of volume, however few
captive consumers are also participating.
Very few Discoms participating (Torrent, Tata Power, REL, Chandigarh, DDN,
JUSCO)
Government Discoms are still absent in the market
18
AF-Mercados EMI
Conclusions
19
Solar power can significantly address power shortage issues
Power procurement through competitive bidding will help states to fulfill their
solar RPO targets at reasonable costs, and complement initiatives like JNNSM
Phase – II
Variety of compliance options (Solar power procurement/REC
procurement/Direct compliance by large consumers) can make compliance
practicable
Active policy and regulatory interventions are required for ensuring market
development, implementation of financeable business models, compliance.
Consistency in regulations of states on RPO, REC, Net meeting for rooftop, and
other related aspects would be highly desirable
AF-Mercados EMI
Thank You
21
AF-Mercados EMI
Annexure I: Summary status of projects under National Solar Mission till 2012-13
Projects Project
Allotted
Project
Commissioned***
Wt Av
Tariff(Rs/Kwh)
CERC Tariff
(Rs/Kwh)
MW MW
Solar PV projects through
NVVN (Batch I) 150 136.4*
12.16 (32%
reduction)
17.91
Solar Thermal Projects
Through NVVN 470 - 11.48
Migration
Scheme
Solar PV 54 50.5
Solar
Thermal 30* 2.5
RPSSGP Scheme (PV) 98.5 91.80
PV projects through
NVVN (Batch II) 350 290
8.77 (43%
reduction)
15.34
Other schemes** 19.6
TOTAL 591 MW
*The solar thermal projects are scheduled to be commissioned by later half of 2013.
* Two projects were cancelled
**Includes demonstration projects, pilot projects, tail end projects
*** as on 30th April 2013
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AF-Mercados EMI
Annexure II: Solar Power Capacity Requirement by States by 2017
Sr. No.
States Demand
(2016-17) (MU)
RPO Target (2016-17)
Solar Power Capacity
Required (MW)
State initiatives
(MW)
Capacity tied - JNNSM Phase -1
(MW)
Capacity likely to be allocated
under Phase-2 of
JNNSM(MW)*
Gap to be fulfilled by
States(MW)
1 Andhra Pradesh 139457 1.25% 1047.35 2.20 75.50 314 655
2 Arunachal Pradesh 823 1.25% 6.18 0.03 0.00 2 4
3 Assam 9556 1.25% 71.77 0.00 5.00 22 45
4 Bihar 25602 1.25% 192.28 38.00 0.00 58 97
5 Chhattisgarh 26497 1.25% 199.00 0.00 29.00 60 110
6 Delhi 37122 1.25% 278.79 2.53 0.00 84 193
7 JERC (Goa & UT) 17002 1.25% 127.69 1.69 0.00 38 88
8 Gujarat 104102 1.25% 781.83 968.50 0.00 235 -
9 Haryana 55918 1.25% 419.96 0.00 8.80 126 285
10 Himachal Pradesh 10989 1.25% 82.53 0.00 0.00 25 58
11 Jammu and Kashmir 16492 1.25% 123.86 0.00 0.00 37 87
12 Jharkhand 8712 1.25% 65.43 0.00 36.00 20 10
13 Karnataka 85455 1.25% 641.79 89.00 70.00 193 290
14 Kerala 26598 1.25% 199.76 0.03 0.00 60 140
15 Madhya Pradesh 77377 1.25% 581.12 206.50 5.25 174 195
16 Maharashtra 197671 1.25% 1484.55 163.50 37.00 446 838
17 Manipur 959 1.25% 7.20 0.00 0.00 2 5
18 Mizoram 677 1.25% 5.09 0.00 0.00 2 4
19 Meghalaya 2801 1.25% 21.03 0.00 0.00 6 15
20 Nagaland 764 1.25% 5.73 0.00 0.00 2 4
21 Orissa 31372 1.25% 235.61 50.00 28.00 71 87
22 Punjab 63171 1.25% 474.43 -0.67 52.50 142 280
23 Rajasthan 72393 1.25% 543.68 65.65 340.50 163 -
24 Sikkim 537 1.25% 4.03 0.00 0.00 1 3
25 Tamil Nadu 118724 1.25% 891.64 274.11 12.00 268 338
26 Tripura 1324 1.25% 9.94 0.00 0.00 3 7
27 Uttarakhand 14559 1.25% 109.34 0.05 5.00 33 71
28 Uttar Pradesh 126323 1.25% 948.71 0.38 93.00 285 571
29 West Bengal 57735 1.25% 433.61 2.05 50.00 130 251
Total Solar Power
Requirement (2016-17) (MW)
9,994
1,864
848
3,000
4730
* State wise allocation of capacity under Phase II done in proportion to the state’s energy demand
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AF-Mercados EMI 24
Annexure III: Case 1 bid results
Capacity Tariff
DB Power 208 4.84
Ind Bharat 500 4.91
Jindal Power Ltd 400 4.96
Dhariwal Infra Ltd 100 4.97
Balco 200 5.05
PTC Meenakshi
(Adhunik Power) 100 5.45
KSK Mahanadi 500 5.49
IL&FS Tamilnadu 540 5.61
GMR 150 5.69
Coastal Energen 600 6.11
OPG 74 7.50
Simhapuri Energy Ltd
(Madhucon) 100 9.85
Capacity Tariff
NSL 300 4.48
RKM Powergen 350 4.886
PTC - TRN ACB 390 4.886
Lanco - Babandh 424 5.074
Jindal 300 5.419
KSK Mahanadi 1000 5.443
PTC - Moser Baer 360 5.73
Navyuga (Krishnapattnam Power
Company limited)
800 5.843
PTC - DB Power 203 5.97
Indiabulls Maharashtra (Nasik) 1200 5.97
Indiabulls Maharashtra (Amravati) 800 6.3
Lanco - Amarkantak 1073 6.303
NCC 200 6.425
Lanco - Vidharba 474 6.643
PTC - East Coast 300 6.819
PTC - DB Power Vindyachal 302 7.1
RPG Dhariwal 245 Disqualified
Reliance (Butibori) Maharashtra 270 Disqualified
Tamil Nadu Bid UP Bid
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AF-Mercados EMI
Annexure IV: State Initiatives for Solar Projects (1/3)
State Announced
(MW)
Tendered
(MW)
Awarded
(MW)
Under
Installation
(MW)
Commissione
d (MW) Additional Notes
Gujarat 968.5 - 968.5 - 824.09
No bidding carried out
during FY 13
State has come up with
roof-top policy for grid
connected systems
Maharashtra - - - 150 125
40 MW commissioned
in Rajasthan (RPO)
under open access
Karnataka 200
80 80 - 9 Under the REC
mechanism the project
developers can sell
their power at APPC
only to the ESCOMS.
A Maximum capacity
of 100 MW can be
installed under this
scheme.
130 Yet to awarded - -
Rajasthan 600 (by 2017) 100 75 - -
RRECL (off-taker) will
in turn sell power to
state DISCOMs
Odisha 75
25 25 - -
25 25 - -
25 - - -
25
Several states have invited bids to fulfill their SPO targets
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AF-Mercados EMI
State Initiatives for Solar Projects (2/3)
State Announced
(MW)
Tendered
(MW)
Awarded
(MW)
Under
Installation
(MW)
Commissione
d (MW) Additional Notes
Tamil Nadu 3000 1000 266 - -
Tender for 1000 MW;
bids received for 499
MW; finally only 266
MW of solar power
projects allocated
State has included
net metering
provision in state
solar policy
Andhra Pradesh 1000 1000 Yet to be
awarded - -
Bidders are required to
match the L1 tariff of
INR 6.49/kWh
State has also come
up with Net metering
policy to promote
solar
A separate category
for green power tariff
has been created in
retail supply tariff
order in FY 14 with a
tariff of INR
10.78/kVAh
26
Several states have invited bids to fulfill their SPO targets
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AF-Mercados EMI
State Initiatives for Solar Projects (2/3)
State Announced
(MW)
Tendered
(MW)
Awarded
(MW)
Under
Installation
(MW)
Commissione
d (MW) Additional Notes
Punjab 300 300 Yet to be
awarded - -
PEDA has released
RFP for 300 MW in
March 2013
Kerela
State has initiated a
solar roof-top scheme
for 10,000 households
in the state
State has introduced
roof-top policy for off-
grid systems
Madhya Pradesh 200 200 200 - -
Bidding categories:
I: Competitive bidding
II: Captive/3rd part
sale within or outside
the state
III: REC
IV: Projects under
JNNSM
Bihar 150 150 Yet to be
awarded 38 -
38 MW have been
awarded at the feed –
in-tariff:
The 150 MW RfP to be
allocated through
competitive bidding
also promotes Pisci-
culture
27 Several states have invited bids to fulfill their SPO targets
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