Flexibility in generation and scheduling of thermal/hydro power through bundling with RE and Storage Power – Scheme proposed by MoP
The Ministry of Power (MoP), recently came up with the scheme that allows the flexibility in generation and scheduling of thermal/hydro power stations through bundling with renewable energy and storage power. Earlier on 5th April 2018, MoP had introduced a detailed mechanism for allowing flexibility in generation and scheduling of thermal power stations.
In order to cater the new issues related to energy-mix and large procurement by distribution licensee, earlier mechanisms are further extended to hydro power power and battery energy storage along with thermal and renewable energy. This would ultimately benefit the distribution licensee to meet their RPO within the existing contract capacity and without any additional financial burden.
Applicability of the projects:
Following three types of projects will be eligible under the scheme:
- RE power plant co-located within the premises of a generating station
- RE power plant located in the vicinity i.e., within 100 km of a generating station
- RE power plant co-located within the premises or located in the vicinity of a generating station supplying RE power to procurers of another generating station, located at a different location and owned by the same generating company.
According to MoP, All new and existing coal/lignite/gas based thermal generating stations or hydro power stations are considered as a ‘generating station’ for the purpose of this scheme.
How would the tariff of RE power plants be determined?
- In case of RE power plant located within the premises of generating station under section 62, appropriate commission will determine the tariff of renewable energy supplied.
- In case RE power plant located in the vicinity of the generating station under section 62 or 63, renewable energy will be procured on a competitive bid basis.
Concession on Transmission Charges
In case of RE power plant located within or located in the vicinity of a generating station, No additional transmission charges will be levied.
In case RE power plant situated at one generating station supplying to procurers of another generating station located at different locations and owned by the same generating company, No transmission charge will be levied for using Interstate transmission system(ISTS).
Scheduling and commercial mechanism
Once the schedule for next day is received from the generating station, the generating company can use thermal/hydro and RE Power to meet the scheduled generation. Sum of all the power supplied from thermal/hydro and RE will be considered for DSM purposes.
Important point to note is that the scheduled capacity of the thermal/hydro will be with respect to the PPA agreement and availability of primary fuel and can not be based on the availability of RE power.
The tariff at which the RE power (with or without Energy storage system) supplied to the beneficiaries will be less than ECR (Energy change rate) of the originally scheduled generating station.
The net saving realised under this scheme will be passed on to the beneficiary by the generating company in the ratio of 50:50 subject to the cap of 7 paise/ kWh to the generator.
DSM and Scheduling
As per the scheme, once the schedule for a specific thermal/hydro generating station has been received, then depending upon the forecast available for RE, the generating station will supply to meet the schedule from thermal/hydro power and replacement of RE power.
The deviation will be applicable to the scheduled generation from thermal/hydro stations and sum of actual generation from thermal/hydro and RE power sources. In case the generating station is able to meet its scheduled generation by supplying thermal/hydro and RE power in any ratio, No DSM charge will be applicable.
Additional mechanism for RE bundling
- Requirement of additional agreement to PPA/PSA : Distribution Licensee can procure RE power within existing PPA to meet their RPO, There will not be any requirement for signing additional agreement
- Requirement of selling the RE power in the power market when it is not feasible to replace the thermal/ hydro power : Even though the first priority of RE power must be given to the PPA holders, according to the scheme, In case it is not feasible to supply the RE power by the generating station, they can sell such RE power to third parties/power exchange without any clearance from the beneficiaries. Also, during such conditions, there will be no requirement of sharing gains/losses with the beneficiaries.