India generated 33029.39 MU Wind Power & 7447.92 MU Solar Power Generated during Year 2015-16

The Minister of State for Power, Coal, New & Renewable Energy and Mines Shri Piyush Goyal informed that the generation of electricity from wind and solar sources in the country stood at 33,029.39 million units and 7,447.92 million units, respectively, during 2015-16.

Quoting the figures received from the Central Electricity Authority (CEA), the minister said during the last two years, i.e., 2014-15 and 2015-16, the country added a total of 5,735 MW of wind power capacity and 4,131 MW of solar power capacity.

It was also told that a capacity addition target of 4,000 MW and 12,000 MW has been proposed for generation of electricity from wind and solar energy, respectively, during 2016-17 and a total of 315 MW have been installed under Solar Roof top Scheme. Power generated from these projects is being used for both domestic and captive use, the minister informed.

Goyal stated that tenders for 20,766 MW solar power projects have been issued. He also said that the wind power projects are mainly developed by private sector under various modes, including PPA, REC, captive use, third party sale etc, adding that the centre has not undertaken construction of wind energy project.

  • The ministry is implementing several schemes to promote generation of solar and wind energy. These include: Development of solar parks and ultra mega solar power projects
  • Development of solar PV power plants on canal banks / canal tops
  • Setting up of 300 MW grid connected solar PV power projects by defense establishments under ministry of defense and Para military forces with viability gap funding (VGF) under Batch-IV of Phase-II/III of Jawaharlal Nehru National Solar Mission (JNNSM)
  • Setting up 1,000 MW grid-connected solar PV power projects by CPSUs with VGF under Batch-V of Phase-II of JNNSM
  • Setting up of 15,000 MW grid-connected solar PV power projects under Batch II of Phase II of National Solar Mission (by NTPC/NVVN)
  • Setting up of 2000 MW grid-connected solar power projects with VGF through Solar Energy Corporation of India (SECI) and generation based incentive scheme for promotion of wind power.

The press release can be accessed here.

 

 

 

Odisha Declares Open Access Charges for 2014-15

Odisha Electricity Regulatory Commission (OERC) has determined the Open Access charges through a notification dated 11thApril 2016.

The new charges determined are applicable for FY 16-17 with effect from 11th April 2014. The details of the charges are in the table below:

 

 

The normative transmission loss at EHT (3.70%) and normative wheeling loss for HT level (8%) are applicable for the year 2016-17.

Additional Surcharge: No additional surcharge over and above the Cross-Subsidy Surcharge needs to be given to the embedded licensee.

No Cross-subsidy surcharge are payable by the consumers availing Renewable power.

20% wheeling charge is payable by the consumer drawing power from Renewable source excluding Co-generation & Bio mass power plant.

The order can be accessed here.

 

 

KERC Tariff Revision 2017

Karnataka Electricity Regulatory Commission in its order dated 30th March 2016, approved the retail supply tariff for 2016-17. The tariff hike proposed by KERC for domestic category and industrial consumers and a comparison of the existing and new tariff approved by the commission can be seen in the table below:

The table below is the cross subsidy charges worked out as per the different the consumer category.

The order can be accessed here.

REC Trade Result March 2016

March, being the last month of the Financial Year to fulfil the yearly RPO obligations, saw significant rise in demand in both the Solar and Non-Solar segments, as compared to the last three months. Non-Solar RECs demand almost doubled and Solar RECs demand rose by 68.45%, as compared to February. This was the result of stricter compliance and can also be attributed to the recent Ad by MNRE asking all entities to fulfil their obligation. The total transaction value stood at 213.3 Crores as compared to 119.5 Crores last month.

Analysis of Trading:

Non Solar – Clearing ratio in exchange stood at 7.65% and 8.93% in IEX and PXIL respectively for Non Solar REC’s. A total of 11, 14,319 RECs were traded as compared to 586,501 RECs traded in February. Overall, it was a good recovery in this segment, which also saw the closing Inventory come down marginally.

Solar – Clearing ratio stood good at 5.07% and 3.35% in IEX and PXIL respectively, with total clearing volume of 152,006, as compared to 90,236 last month. The recovery was good, but contrary to the Non-Solar inventory, the solar inventory showed no reduction.

 

As compared to March-2015, where the Non-Solar and Solar demand stood at 654985 and 68982 respectively, it was 70% and 120% higher for Non-Solar and solar respectively, in March-2016. However, the closing inventory for the FY stands at 13.28 million and 3.31 million for Non-Solar and Solar respectively, worth close to Rs. 3151 Crores. April-2015 trading saw huge clearance due to late fulfillment of obligations, and the same can be expected next month as well.

We are hopeful that the FY 2016-17 will bring good fortune to the REC market, considering the proposed regulatory changes and more stricter enforcement by states, which will bring back stakeholders confidence.

Draft Policy for Repowering of the Wind Power Projects

The Ministry of New & Renewable Energy in consultation with various stakeholders including the Industry and States recently came up with the Draft Policy for Repowering of the Wind Power Projects with an objective to promote optimum utilization of wind energy resources. Some of the key pints of the policy are mentioned below:

  • All the wind turbine generators with the capacity of 1MW or below would be eligible for repowering.
  • The Policy offers incentives in form of an additional interest rate rebate of 0.25% over existing rebate available to the new wind projects by IREDA.
  • Secondly through benefits like Accelerated Depreciation or GBI that would be made available to the repowering project.
  • The power generated corresponding to average of last three years’ generation prior to repowering would continue to be procured on the terms of existing PPA.
  • Augmentation of transmission system from pooling station onwards to be carried out by the respective STU.
  • During the period of execution of repowering, wind turbines would be exempted from not honoring the PPA for the non-availability
  •  Similarly, in case of repowering by captive user they will to be allowed to purchase power from grid during the period of execution of repowering.

 

The Policy can be accessed here.

 

CERC (Terms and Conditions for Exchange of ESCerts) Regulations, 2016xchange of ESCerts) Regulations, 2016

Background

An important part of the Perform, Achieve, and Trade (PAT) mechanism for Energy Efficiency is the ‘trading’ aspect. PAT Cycle I was completed last year and the next logical step in the process is the trading of Energy Saving Certificates (ESCerts).  For a detailed analysis of the PAT scheme, see our Newsletter  Vol. 47 January 2015.

 

The actual ‘trading’ may soon become a reality as CERC recently came out with draft regulations that will govern such trading on power exchanges. A brief analysis is below:

 

Draft Regulation:

The draft Regulations has proposed to assign the responsibilities to BEE, CERC and POSOCO:

 

BEE:BEE shall discharge the role of Administrator of ESCerts and shall provide assistance to the Commission in the matters involving exchange of ESCerts on Power Exchanges and shall coordinate with the Power Exchanges and Registry for smooth interface for Exchange of ESCerts

 

CERC : CERC would function as the Market  Regulator.  In its role as Market Regulator, the draft Regulations proposes to  approve the procedure for interface activities between Power Exchanges and Registry, Administrator and Registry, and Registry and Designated Consumer And monitor the operations and performance of Power Exchanges with regard to exchange of ESCerts ;

 

POSOCO: During the introduction of Renewable Energy Certificates ( RECs) , POSOCO was mandated to act as the Registry.  Ministry of Power has assigned the

function of Registry of ESCerts trading to POSOCO for the exchange of ESCerts on the Power Exchanges .  In its capacity as the Registry for ESCerts, POSOCO is envisaged to discharge the following important functions:

 

  • Assistance in registration process of ESCerts including crediting of ESCerts to DCs after approval from MoP,
  • Guidance on dealing in the process of ESCerts trading/ exchange
  • Coordination and information dissemination with DCs, Power Exchanges, BEE and Regulator (i.e. CERC)

 

Issuance of ESCerts:

  • The DCs would be issued ESCerts in electronic form in a cycle period for achieving specific energy consumption less than the energy consumption norms and standards notified by the Central Government for the cycle period, under Energy Conservation Rules, and subsequent cycles, who have held such certificates in Registry accounts.

 

  • The DC’s whose specific energy consumption shall be more than the prescribed energy consumption norms and standards specified for a cycle period and subsequent cycles and who wish to comply with the prescribed energy consumption norms and standards using ESCerts in lieu of implementing energy conservation and energy efficiency improvement measures shall be entitled to purchase the ESCerts to meet compliance with the norms and standards prescribed under

 

The Certificate issued to eligible entities by the Government on the recommendations of the Bureau could be transacted on any of the Power Exchanges by the ESCerts holder.

It’s important to note that BEE has proposed that ESCerts have no floor or forbearance price. Pricing will therefore be determined purely through demand and supply of ESCerts. Initial analysis suggests that there will be significant oversupply of ESCerts, leading to low prices. However, its important to note that companies have the choice to ‘bank’ ESCerts to the next cycle – this feature may have the effect of a floor price as if the trading price is lower than the cost of achieving energy savings, the company will be better off banking the certificates rather than trading them.

 

The regulation can be accessed here.

 

HPERC Declares APPC for 2015-16

The Himachal Pradesh Electricity Regulatory Commission (HPERC) recently came up with its order on the Average Pooled Power Purchase Cost (APPC) for the financial year 2015-16.

The definition of APPC followed by HPERC is in line with the CERC definition and can be read as:

Pooled Cost of Purchase means The weighted average pooled price at which the distribution licensee has purchased the electricity including cost of self-generation, if any, in the previous year from all the energy suppliers long-term and short-term, but excluding those based on renewable energy sources, as the case may be.”

The APPC for the financial year 15-16 has been determined as Rs. 2.31 per Unit, by the commission which shall continue for further period with such variation or modification as may be ordered by the Commission for the next financial year.

The APPC for FY 15-16 is 3.12% higher as compared to the APPC of FY 14-15.The graph given below depicts the APPC’s determined by HPERC over last four years and how the APPC rates have increased over the past three years :

The HPERC order can be accessed here.

Karnataka Electricity Regulatory Commission Draft Smart Grid Regulations, 2015

KERC came up with its first draft Smart Grid Regulations on 22nd December, 2015. Smart grid through automation and controls system would deliver electricity more reliably, effectively and environment friendly, thus enabling much wider generation and consumer participation in power sector operations.

Some of the Key points of the regulation are as follows:

  • These regulations shall be applicable to all Generation companies, Distribution Licensees, Transmission Licensees and consumers in the state and connected to the state grid.
  • The objective of the regulation is to enable integration of various smart grid technologies, enhance network accessibility and measures to bring about efficiency improvement in generation and integrate renewable energy into grid and micro grids.
  • The Commission may from time to time issue guidelines for generating company, transmission licenses and distribution licensee in execution of activities like formulation and implementation of smart grid programmes.
  • The Commission directs every transmission and distribution licensee to constitute smart grid cells within three months of notification of the regulation which shall be responsible for:
    • Baseline study & Development of data
    • Formulation of smart grid plans, programmes and projects
    • Design and development of smart grid projects including cost benefit analysis and plans for implementation, monitoring and reporting.
    • Assist licensees in getting necessary approvals to smart grid plans.
    • Implementation of smart grid programmes
    • The transmission licensee and distribution licensee may combine activities related to energy efficiency, DSM and smart grid implementation within the same cell.

 

The Regulation can be accessed here.

REC Trade Results November 2015

RECs demand has been steadily rising, and this month results have been very encouraging. Non Solar REC’s and Solar REC’s traded this month were 9.5% and 533% higher compared to trading session of October. The total transaction value of REC’s hit a sum total of Rs 65.5 crores, compared to Rs. 36.5 crores last month.

Analysis of Trading:

Non Solar – Clearing ratio in exchange were at 1.44% and 1.90% in IEX and PXIL respectively for Non Solar REC’s. A total of 2, 31,545 RECs were traded in this trading session (in October 2, 11,442 RECs were traded)Clearing ratio at PXIL reduced marginally but picked up on IEX, as compared to last month.

Solar – Clearing ratio stood at 2.07% and 4.97% in IEX and PXIL respectively, compared to 0.54% and 0.33% last month. A total of 87,767 REC’s were sold in this session, 6.33 times compared to October.

Trading volumes are expected to increase significantly going forward, as most obligated entities are now gearing up to fulfill their obligation considering that only 4 trading sessions are remaining in the current FY . Further, this year we have seen regulatory action in the form of compliance orders and/ or proceedings in several states like Orissa, Kerala, UP, MP and Maharashtra, to name a few. Overall the market showed clear signs of recovery, and is expected to grow further in the closing months of the FY.

The October’s trade results can be accessed here.

Five More States to Kick Start Power Sector Reforms

In addition to Meghalaya, Goa and Uttarakhand, five more states would be signing a joint statement of reforms with the Central Government in order to enable 24×7 power supplies to consumers. The states Rajasthan, Andhra Pradesh, Jharkhand, Chhattisgarh and Assam are set to take up the government’s “Power for All” programme. Maharashtra is also trying to achieve the impetus to take up the programme. As the Center is pursuing states to cut their losses and by hiking tariff and raising funds from the market, the states would be hiking their tariffs as follows:-

Among these big states only Andhra Pradesh doesn’t require any raise in the tariff, as it is not burdened with any financial losses unlike the rest of the states. The following graph depicts the financial losses incurred and the funds required by the states to cover up their losses, with Rajasthan being the state with highest financial losses and Assam being the least.

The above update has been taken from Business Standard’s article published on 19th October, 2015 which can be accessed here.

Our previous blog on power sector reforms can be accessed here.

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