Hindustan Power plans to raise around Rs 6,000 crore in next two years
Hindustan Power is targeting to raise around Rs 6,000 crore over the next two years to add 5 -6 GW of solar power capacity. “I think our goal to build out 5-6 GW of solar over the next five years both in India and outside India and that would be somewhere in the range of around a billion dollars (around Rs 6,000 crore) of equity,” Hindustan Power Chairman Ratul Puri said on the sidelines of a function here. “So, that would be raised over the next couple of years through internal cash generations and from external investors or potentially divesting some assets..potentially a combination of all these three,” Puri said. Asserting that there was nothing imminent in any area at present, Puri said that the company was just exploring opportunities at this juncture. Replying to a question, he said, “I think we are always looking at different opportunities to raise capital to finance growth and there are always multiple opportunities that are available. And… selling part of our assets is one of those opportunities”. “So, I think there is something which is ongoing. Not just sale but we are looking at capital to fund growth,” he added. The company’s current capacity is 2,000 MW, of which 800 MW solar. Terrell Owens Jersey
To make projects viable, GAIL proposes bundling solar, gas-based power
Public sector natural gas pipeline operator GAIL India is in talks with the government, seeking extension of incentives for gas-based power producers. “We are working with stakeholders to cut down the input cost and make gas-based power generation projects more viable,” GAIL Chairman BC Tripathi told BusinessLine. An option is to bundle it with solar or providing some other kind of support, he added. Spinning reserves A senior GAIL official said this proposal is similar to the initial plan to use gas-based power plants as spinning reserves to mitigate tariff hikes. The cost of natural gas-based power has been traditionally higher than conventional power generation, as natural gas-based power generation can be ramped up to meet peak demand and bridge the power supply shortage. This scenario has changed now and gas-based power generation is no longer financially viable due to abundance of cheap power. Since solar power has become cheaper due to competitive bids, gas-based power can be bundled with it to bridge the demand for power when solar power is unavailable during the evening and night hours, the official explained. Commenting on the total consumption of natural gas by gas-based plants, Tripathi said: “Power plants are currently consuming about 25-26 mmscmd of gas. Of this, 5 mmscmd is imported liquefied natural gas, and the rest is domestic gas.” The government had also initiated a scheme to subsidise imported gas-based power generation. This scheme was discontinued from March 31 this year. Subsidised gas “Before power pooling, we were selling almost 4.5 mmscmd to such plants who were enjoying the benefit of subsidy. Today, we are supplying almost 3.2 mmscmd to such plants and they are not getting any subsidy but they are sustainable at the current price,” Tripathi said. Almost 80 per cent of these plants using subsidised gas are still drawing gas. Power plants in Uttarakhand and Dabhol are still drawing gas, he added. According to the Petroleum Policy and Analysis Cell, around 242 MW of power is generated from 1 mmscmd of gas under standard conditions. Going by the amount of gas currently consumed, nearly 6,292 MW of gas-based power generation is currently operational out of the 25,000 MW stranded capacity in the country. Russell Wilson Jersey
Overall power shortage down to 0.7 per cent in 2016-17: Government
The government today said that the energy shortage has came down to 0.7 per cent in 2016-17. “Energy Shortage reduced from 4.2 per cent in 2013-14 to 0.7 per cent in 2016-17,” the power ministry said in a statement. The energy shortage in 2014 was 42,428 MU (million units) (4.2 per cent), which came down to 7,595 MU in FY’17 (0.7 per cent), it said. The statement is on the three years achievements of the government. The ministry further said that “peak energy shortage in 2014 was 6,103 mw (4.5 per cent) which came down to 2,608 mw (1.6 per cent) in 2017.” The ministry further said that India has turned around from a net importer of electricity to net exporter by exporting around 6,444 MU to Nepal, Bangladesh and Myanmar in 2016-17. The total power capacity increased by nearly a third from 243 GW in March 2014 to 320 GW in March 2017. Total installed capacity increased by 33.3 per cent to 3,26,849MW till 2016-17, it said. There has been 40 per cent (more than one third) increase in transmission capacity from 5,30,546 MVA in March 2014 to 7,40,765 MVA in March 17, the ministry said. A total of 26 states and one union territory has joined UDAY (Ujwal DISCOM Assurance Yojana) which seeks to turn around discoms. “Almost 85 per cent UDAY bonds have already been issued (Rs 2.32 lakh crore out of total Rs 2.72 lakh crore) leading to less rate of interest for DISCOMs. This has led to savings of nearly Rs 12,000 crore,” it said. Davon House Jersey
BHEL commissions 270 MW thermal unit in Nashik district of Maharashtra.
State-run power equipment maker BHEL today said it has commissioned a 270 megawatt (MW) thermal unit at Sinnar in Nashik district of Maharashtra. The newly commissioned unit is part of RattanIndia Nasik Power Ltd’s 5×270 MW thermal power project. “This is the fourth unit to be commissioned at this project. Significantly, the milestone has been achieved within 35 days of commissioning of the third unit,” Bharat Heavy Electricals Limited (BHEL) said in a BSE filing. BHEL said so far it has successfully commissioned 14 sets of 270 MW rating in the country, including nine sets for the RattanIndia group. Alex Anzalone Authentic Jersey
Overall power shortage down to 0.7 per cent in 2016-17: Government
The government today said that the energy shortage has came down to 0.7 per cent in 2016-17. “Energy Shortage reduced from 4.2 per cent in 2013-14 to 0.7 per cent in 2016-17,” the power ministry said in a statement. The energy shortage in 2014 was 42,428 MU (million units) (4.2 per cent), which came down to 7,595 MU in FY’17 (0.7 per cent), it said. The statement is on the three years achievements of the government. The ministry further said that “peak energy shortage in 2014 was 6,103 mw (4.5 per cent) which came down to 2,608 mw (1.6 per cent) in 2017.” The ministry further said that India has turned around from a net importer of electricity to net exporter by exporting around 6,444 MU to Nepal, Bangladesh and Myanmar in 2016-17. The total power capacity increased by nearly a third from 243 GW in March 2014 to 320 GW in March 2017. Total installed capacity increased by 33.3 per cent to 3,26,849MW till 2016-17, it said. There has been 40 per cent (more than one third) increase in transmission capacity from 5,30,546 MVA in March 2014 to 7,40,765 MVA in March 17, the ministry said. A total of 26 states and one union territory has joined UDAY (Ujwal DISCOM Assurance Yojana) which seeks to turn around discoms. “Almost 85 per cent UDAY bonds have already been issued (Rs 2.32 lakh crore out of total Rs 2.72 lakh crore) leading to less rate of interest for DISCOMs. This has led to savings of nearly Rs 12,000 crore,” it said. Marquette King Womens Jersey
Haryana Government to set up renewable energy project at Jhajjar
While China Light & Power has offered to join hands with the Haryana Government in setting up a Rs 500-crore renewable energy project at Jhajjar, global majors, including United Technologies, Carrier, Everstone Logistics and CISCO have evinced keen interest in making investments in such fields as logistics, development of smart cities and sustainable solutions, and setting up a skill development centre. The offers were made when the chief minister, Manohar Lal, who is leading a nine-member delegation to project Haryana as a preferred investment destination, had one-to-one and back-to-back rounds with captains of industry and leading investors in Hong Kong today, and in Singapore, last night. The delegation has reached Hong Kong from Singapore. A senior level team from China Light & Power comprising CEO Richard Lancaster, chief financial officer, Geert Peters, and managing director India, Rajiv Mishra, met the chief minister in Hong Kong this morning. They discussed a proposal for setting up a renewable energy project at Jhajjar with an investment of Rs 500 crore. They were told that a very good opportunity awaited them to utilize non-arable land in the state for setting up projects. A team from United Technologies also met the chief minister and discussed proposal for developing smart city sustainability solutions relating to building security and controls. Carrier made a proposal to set up a skill development centre in Haryana jointly with the state government for providing skill training to the youth. A high-level Carrier team said work on expansion of their existing facility in Haryana would begin soon, Eric Chu, executive general Manager, HVAC, Hong Kong & Macau; Gary Chuk, director, Building Controls and Integrated Solutions, HMTG; and, Paul Tsui, General Manager Sustainability Solutions, Carrier Hong Kong, attended the meeting. Later, the Chief Minister addressed captains of industry and leading investors at the Invest Haryana Road Show in Hong Kong. It was attended by more than 100 delegates from Hong Kong who belonged mostly to the banking and financial sector. The key sectors which offered vast investment scope included skill development, healthcare, infrastructure, transport, smart cities, renewable energy etc. Later, Sudhir Rajpal, principal secretary, Industries, made a presentation and shared details of the bankable projects with safe returns on investment. He also shared details of the projects like Global City, MRTS between Gurugram Manesar Bawal, Logistics Hub, Aviation Hub, Global Economic Corridor along the KMP Expressway, Smart city Gurugram, Faridabad and Karnal. Jeremy Hellickson Jersey
Use of solar rooftop systems dismal in metros: Greenpeace
Despite a substantial subsidy offered by the government, installation of solar rooftop systems has been “dismal” in metros including Delhi and Mumbai, an analysis by a green body today said. Rooftop solar systems are those in which electricity is generated by installing solar panels on rooftops of residential or commercial buildings. Greenpeace India in its new analysis – Indian cities slacking on rooftop solar said that despite policies and net metering guidelines in several states, installation of such systems has been dismal. “Despite policies and net metering guidelines in several states and a subsidy of 30 per cent offered by the Ministry of New and Renewable Energy (MNRE), the installation of solar rooftop systems has been dismal in leading metros in the country, especially in Chennai and Mumbai,” the green body said. According to reports, a net metering is a new concept where an instrument which has a special metering and billing agreement between utilities and their customers, facilitates the connection of small, renewable energy-generating systems to the power grid. It said, Delhi, which offers a generation-based subsidy as per the solar policy released last year, as well as net metered connections, has also failed to see a big uptake in the residential sector. “Delhis total solar potential is 2,500 MW with a residential potential of 1,250 MW. The official target in Delhi is to reach 1,000 MW worth of solar installations by 2020 and 2,000 MW by 2025. “But as of December 2016, only 35.9 MW have been installed out of which only 3 MW were residential installations in March 2016,” the analysis said. On the other hand, Mumbai, which has a potential of 1,720 MW has only 5 MW overall installed till now while the entire state of Tamil Nadu has less than 2 MW as against a rooftop solar target of 350 MW. The green body said that the MNRE has earmarked 40 GW as the rooftop solar target by 2022 but as of December 2016, installation had just crossed 1 GW, it said. The reasons for the slow uptake seem to be lack of familiarity with the process and fear of bureaucratic red tape, the body said while asserting that though net metering provisions are present in most states, effectiveness of implementation varies significantly. “Despite the national incentive in the form of a 30 per cent capital subsidy, and a range of state incentives and schemes, rooftop solar is yet to take off in the same manner as large-scale solar. “However, this does not mean India should lower its ambitious targets, as some have suggested. Rather, the government must step up and play a more proactive role in encouraging rooftop installations,” said Pujarini Sen, Climate and Energy Campaigner, Greenpeace India. Sen said that this can be done via innovative financing schemes, aggregating demand and incentivising city and state governments. “The potential benefits in terms of reduced energy expenditure and cleaner air due to reduced demand on fossil fuels are too significant to be ignored. “As the convenor and a founding member of the International Solar Alliance (ISA), and a country with abundant solar potential, Indias commitment to clean energy must continue to be robust,” Sen said. Noting that air pollution leads to 1.2 million deaths every year while referring to a Global Burden of Disease study, Greenpeace India said decarbonising the power sector is essential to tackle the menace of air pollution. Referring to a poll conducted by Greenpeace, the body said that close to 55 per cent of the 812 survey respondents from its supporter base expressed interest in investing in and installing solar. “There is still a widespread perception that installation of rooftop solar panels needs a large investment, and people are not always aware of the financial incentives available. “If central and state governments are serious about boosting solar, they must do a better job of reaching out to resident welfare associations and community groups to encourage people to shed their inhibitions and embrace rooftop solar,” said Sen. Kendall Lamm Womens Jersey
India’s red hot solar sector has been served a tax shocker
India’s sizzling solar power sector, where rock-bottom tariffs are now competing with coal-based electricity, has been served a tax plan that could cause a lot of burn. Under the upcoming Goods and Services Tax (GST) regime, which will replace multiple taxes levied by the central and state governments starting July 01, solar modules have been handed a rate of 18%. That’s quite a jump from the current 5% value added tax (VAT) that most states levy, which effectively drops to zero due to several waivers. “The new regime will, therefore, result in an increase of 18% in module cost, about 12% in inverter cost, and 3% in all service costs—increasing overall project cost by about 12%,” Bridge to India (BTI), a renewable energy consultancy, wrote in a recent note. By BTI’s estimation, the higher GST rates could hit over 10 gigawatt (GW) of ongoing projects. This is substantial considering that India is likely to have only 18GW of solar power by the end of 2017. As Quartz has argued earlier, India’s solar sector is already under duress with aggressive bidding in recent months having driven tariffs to unviable levels. Any further increase in costs will only worsen things. Although the ministry of new and renewable energy has previously assured developers that any increase in cost would be passed through to the buyer, according to BTI, this is easier said than done. Not only are there multiple formats of power purchase agreements (PPAs) to deal with, distribution companies are also expected to resist tariff hikes at a time when auctions are throwing up record-low numbers. “Third, the entire process for tariff determination, ratification, and documentation amendments would easily take up to six months or even more,” BTI’s note said. Solar project developers, too, estimate a significant increase in cost and delays. “Following GST, solar projects will be about 18% costlier on an average, while cost of generation would go up by around 20%,” Ratul Puri, chairman of Hindustan Power Projects, told the Economic Times. “It would require project developers to go back to banks for additional funding for projects under construction. It might require a minimum of three months to get additional funding, thus delaying projects.” These delays, BTI reckons, could even lead to the cancellation of some projects altogether. In the long-term, however, the GST’s impact is likely to be evened out by falling costs. That’s something India’s energy minister Piyush Goyal is betting on. “We don’t need support of lower taxes to encourage renewable energy,” Goyal said on May 19. “Solar, wind, and hydro would be affordable forms of power. I don’t think GST rates will impact my sectors.” Nonetheless, India’s solar sector seems set up to deal with some short-term pain. Zack Martin Jersey
Compensation for grid curtailment to benefit renewable sector: India Ratings
The Centre’s proposed compensation mechanism for existing renewable energy projects will protect the cash flows to an extent from grid curtailments and will also ensure a favourable operational environment for renewables sector, said India Ratings. “If the proposal is adopted it will protect the cash flows to an extent from grid curtailments and also ensure a favourable operational environment for renewable energy projects. It will also be positive for wind and solar energy developers,” the ratings agency said in a statement here. Historically, power purchase agreements (PPAs) signed for renewable energy projects have failed to address the grid issues and lacked a mechanism to compensate for energy loss. According to Ind-Ra, the annual debt service coverage ratio (DSCR) slips by 0.12 times for 10 per cent of energy curtailment and the 50 per cent proposed compensation at PPA tariff will restrict the fall by half at 0.06 per cent. The developers have bridged any cash flow shortfall in debt service through a combination of or individually tapping debt service reserve or drawing working capital limits or sponsor support, it said. “The recent reverse auction of 750MW solar capacity in Rewa solar bid included the provisions for compensation for deemed generation in case of curtailment. The recommended PPA format for future wind and solar projects should also include provisions for curtailment compensation.” It, however, maintained that the absence of clarity on two possible reasons for grid curtailment – low system demand and grid security – could however pose new challenges for developers. “Further clarity by the authority/utilities to define the terms and spell out when these measures will need to be opted for could allay possible apprehensions of the developers and make the process more transparent,” the agency said. Also, in the proposed framework it is unclear which situations will be identified as low system demand incidences, since the network operators have the option to shut down a thermal plant which is falling below its technical minimum operating level, it said. Citing the recent forced shutdown of some thermal power plants by Tamil Nadu discom during high wind season to enable full evacuation of wind power generation, Ind-Ra said there is a possibility of utilities taking refuge under the low system demand and curtail high costs renewables to save costs leading to reduced cash flows. “We believe that utilities should project demand for the next six months to one year along with definition of low system demand. This transparent process could allay the fears of developers when actually the demand plummets,” it said. The compensation will also incentivise grid operators and distribution utilities to reduce curtailments and benefit renewable energy developers in scheduling and forecasting and enable integration of increasing renewable energy capacity. In FY17, grid curtailment was prevalent for wind projects in Rajasthan (up to even 45 per cent energy curtailed compared to 90 per cent of plant load factor) and solar projects in Tamil Nadu. Deion Sanders Jersey
BHEL commissions 1,980 Mw super-critical thermal power plant in UP
Bharat Heavy Electricals Ltd (BHEL), the country’s largest power equipment manufacturer, today announced it has commissioned the third 660 Megawatt (Mw) unit of the 1,980 Mw Prayagraj Super Thermal Power Project (PSTPP) in Uttar Pradesh, successfully completing the execution of the plant in Allahabad. The first two units of the project, commissioned earlier by BHEL, are already under commercial operation. Located in Bara tehsil in Allahabad, the project is owned by Prayagraj Power Generation Company Limited (PPGCL), a subsidiary company of Jaiprakash Power Ventures Limited. BHEL’s scope of work in the project included design, engineering, manufacture, supply, erection and commissioning of the Boiler and Turbine-Generator (BTG) package. The key equipment for the project was manufactured by BHEL at its Haridwar, Trichy, Hyderabad, Ranipet and Bengaluru works while the construction of the plant was undertaken by the company’s Power Sector-Northern Region unit. “Notably, in the last 17 months, six supercritical sets have been commissioned in Uttar Pradesh, all of which have been installed by BHEL,” the company said in a statement today. It added that over 70 per cent of Uttar Pradesh’s power generation capacity — aggregating to more than 17,000 Mw — has been supplied by BHEL. The company has commissioned 4,960 Mw of projects in the state in the last two years. Jordan Poyer Womens Jersey