AS PER STUDIES, EXPERTS ARE BAD AT PREDICTING SOLAR INSTALLATIONS

As per an article published by Visual Capitalist, organisations such as IEA (International Energy Agency) and EIA (Energy Information Administration), which have been predicting data on energy supply and demand as well as their forecast have been facing a number of challenges. Also, it can be said that these organisations are conservative with their forecast.

 

Source: Visual Capitalist

 

As per the graph, there is a huge gap between the historic data and the predictions by the IEA. None of the models have been able to rightly predict the growth in solar installations.

ANALYSIS OF MPERC DRAFT REGULATIONS ON FORECASTING, SCHEDULING, DEVIATION SETTLEMENT OF WIND AND SOLAR GENERATING STATIONS

Madhya Pradesh Electricity Regulatory Commission (MPERC) has published draft regulations for forecasting and scheduling for wind and solar projects. Important aspects of the regulation are discussed below.

Earlier Odisha, Gujarat, Karnataka, Tamil Nadu, Rajasthan, Jharkhand, Andhra Pradesh and Chhattisgarh had come out with their draft DSM Regulation on Forecasting & Scheduling of Wind & Solar.  So far, Karnataka is the only state that has published final regulations.

Executive Summary:

  • Forecasting and scheduling will be mandatory for all the wind and solar generators connected to the State grid, including those connected via pooling stations.

  • Error will be calculated on the basis of Available Capacity (AvC), with permissible deviation of ±15% for old wind projects and ±10% for new wind projects (i.e., projects commissioned after May 2017).

  • Settlement will be done through the “Qualified Coordinating Agency” or QCA. However there is no mention of Aggregation.

  • The Deviation charges shall be paid within 10 days of the issue of Statement of Charges for Deviation into the “State Deviation Pool Account”.

  • 16 intraday revisions will be allowed for wind and solar energy (one revision every 1.5 hours). Revisions will be effective starting from 4th time block onwards.

  • QCA will be treated as a state entity, registered with SLDC. The preparation and settlement of ‘Deviation Pool Accounts’ shall be undertaken on weekly basis coinciding with mechanism followed for regional energy accounts.

  • SCADA & Telemetry data is to be mandatorily provided to SLDC by the generators. SLDC shall formulate Data/information exchange requirements and protocols for the same.

Detailed Analysis:

MPERC has recently come up with draft regulation for forecasting and scheduling and deviation settlement mechanism. The primary objective is twofold: a) facilitate large-scale grid integration of solar and wind generating stations b) maintaining grid stability and security. Highlights of the draft regulation are below:

Applicability:

All Wind & Solar Pooling sub-stations, irrespective of their capacity, commissioning date and connectivity voltage level, have to provide a day-ahead and intra-day revisions to a maximum of 16/day, and one revision for each 1.5Hr interval.

Error calculation and penalty bands:

  • Payment for generation shall be as per actual generation (this is different from the inter-state regulation, where payment is on the basis of scheduled generation).

  • Error is calculated based on Available Capacity (this is same as in the case of draft regulations of TN, Gujarat, Odisha, Rajasthan and Jharkhand).

  • The deviation slab has been kept as (+/-) 10% for new projects and (+/-) 15% for old projects. The reference date for old and new projects is 26.5.2017.

Detailed Mechanism defined for Deviation Settlement

 

In case of Intra-State transmission, Penalty Mechanism for wind generating station or pooling station commissioned prior to 26.5.2017

 
In case of Intra-State transmission, Penalty Mechanism for wind generating station or pooling station commissioned after to the regulations are notified.
It is to be noted that the new projects commissioned after the regulations are notified, have to comply by stricter deviation norms, and may have to consider the costs and liabilities of this mechanism in their project financial planning.

MOP WAIVERS TRANSMISSION CHARGES AND LOSSES ON ELECTRICITY FROM SOLAR SOURCES

This is an attempt to encourage solar and wind  energy in the country, the Ministry of Power (MoP) had waived off the inter-state transmission charges and losses on the electricity generated by wind and solar sources of energy in September last year. That order has now been amended by the MoP  and as per the new order, transmission charges and losses are wavered off only on solar projects.  The MoP, after consultation with MNRE, CEA, CERC and POSOCO, has notified the following:

For generation projects based on solar resources, the waiver will be on projects commissioned till 31/12/2019. The waiver will be available till 25 years of date of commissioning of such projects and on solar  projects entering PPAs for sale of electricity to DISCOMs for compliance of RPO. The remaining of the terms and conditions remain the same as the 2016 order.

As per our analysis, this order by the MoP has a number of limitations. First of all, it is only applicable to solar projects from which the electricity will be sold to the DISCOMs. Secondly, it will only be on those solar projects entering PPAs for the compliance of RPO.

The order released in 2016 can be accessed here.

INDIA’S ELECTRICITY REQUIREMENT TO GO UP BY 37% IN THE COMING YEARS

As per the 19th electric power supply report by the Central Electricity Authority (CEA), the country will need 1,566 BUs of energy by 2022 which means that there will be an increase of 37%. An annual growth of 2.6% was recorded in the FY 2017. As per the 18th EPS report, the electricity generation for FY 2017 was supposed to be 1,355 BUs whereas it was close to 1143 BUs. The expected peak demand in the FY 2022 is supposed to be 226 GW.

 

The article reporting the same can be accessed here.

AERC releases retail tariff for FY 2017-18

The Assam Electricity Regulatory Commission (AERC) in an order dated  31st March released tariff for FY 2017-18 for the Assam Power Distribution Corporation Limited (APDCL). The change in energy charge from last year to this year has been depicted in the following table:

 

 

The tariff has increased since the last year specially for HT II industries and commercial users for who the tariff has increased significantly. There has been an increase in the CSS as well this year.

The open access charges are as follows:

 

Cross Subsidy Surcharge: The CSS for FY 2017-18 is Rs 1.31/kWh

Wheeling Charge : The wheeling charge applicable for FY 2017-18 is Rs 0.23/kWh

 Wheeling Loss: The wheeling loss at 11 kV is 11% and that at 33 kV is 5%

Transmission Loss: The transmission loss for Assam has been determined as 3.49%

 

The order can be accessed here.

KSERC RELEASES TARIFF ORDER FOR FY 2017-18

KSERC (Kerala State Electricity Regulatory Commission) has released a tariff order determining the retail tariff for FY 2017-18 for the state. Salient features of the order are as follows:

 

 

Transmission Charge: The transmission charge for FY 2017-18 is Rs 0.37/unit

Wheeling Charges: The wheeling charges determined for the FY 2017-18 are Rs 0.31/unit

Cross Subsidy Surcharge: The cross subsidy surcharge is  Rs 0.91/unit.

 

The order can be accessed here.

HPERC NOTIFIES RETAIL TARIFF ORDER FOR FY 2017-18

The HPERC has released the retail tariff for FY 2017-18 in its order. The tariff has basically remained unchanged to a large extent.

 

The tariff is given as follows:

 Screenshot (88).png

Cross Subsidy Surcharge: Rs 1.89/unit

Wheeling charges: Rs 1.83/unit

Additional Surcharge: Rs 0.49/unit

The article can be accessed here.

The press note about the same can be accessed here.

SOLAR TARIFF HITS ANOTHER NEW LOW

Solar tariff has hit another low in the auction held for the solar park in Rajasthan’s  Bhadla. The top slot was won by ACME, a domestic company for Rs 2.44 a unit for 200 MW. SoftBank Energy closely followed at Rs 2.45 for 500 MW. As per the analysis given in an article by Business Standard. there has been an 80% fall in solar tariff since the past 6 years.

 

As per a Livemint article, this drastic reduction in solar prices has caused a decrease in the number of clean energy deals as there is a fear that the DISCOMS will not honor the Power Purchase Agreements (PPAs) signed earlier at a higher rate since this has happened in the past.

A link to our previous analysis can be found here and here.

APERC DETERMINES TARIFF FOR WIND PROJECTS

The Andhra Pradesh Electricity Regulatory Commission has recently proposed the tariff for wind energy sources which will be applicable for the projects commissioned during FY 2017-18. The tariff will be applicable for 25 years. The details of the tariff proposed are as follows:

 

Screenshot (46).png

 

The order can be accessed here.

SOLAR POWER TARIFF HITS A NEW LOW

During the auction for a 250 MW capacity for Adani Renewable Energy Park in Bhadla, Rajasthan, the solar tariff fell to a new low of Rs 2.62 per unit. The previous low in tariff was  at an auction in Andhra Pradesh where the price was set at Rs 3.15 per unit. In the auction, Phelan Energy Group and Avaada Power, companies based in South Africa won the bid to build capacities of 50 MW and 100 MW by bidding at Rs 2.62 kWh per unit.

This low also beats the average price of power generated at the coal based plants owned by India’s largest power generation utility, NTPC Ltd. India is set to come to the position of being the third-biggest solar market globally in 2017 to  fulfill the 8.8 GW capacity addition projected for the year.

The article can be accessed here.

Our analysis of the previous lows seen in solar tariff can be accessed here.

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