Big jump in Renewable Energy Certificates trading volumes

The numbers for renewable energy certificates traded have seen a big jump compared to last year’s numbers. As many as 256,579 non-solar and 83,189 solar RECs were sold on the two country’s energy exchanges—IEXL and PXIL—roughly four times the volumes seen in April. These RECs were worth Rs. 38.5 crore and Rs. 29 crore, respectively. Comparatively, in May 2014, only 29,555 non- solar RECs and 2,120 solar RECs were sold.

These numbers are unusual for the early months of the financial year—trading in RECs pick up in the last quarter, as the companies mandated to meet their renewable purchase obligations rush to comply before the year is out.

The high numbers have been generally attributed to last week’s judgment of the Supreme Court. The judgment said that companies that had captive power plants were not exempted from the renewable purchase obligations.

The official release by the Indian Energy Exchange can be found here. The PXI data released can be accessed here.

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Million Jobs in Indian Renewable Energy Sector by 2022

India is world’s third-largest emitter of greenhouse gases but 127th in terms of per capita emissions.

Indian renewable energy sector, which has been among the top priorities for Prime Minister Narendra Modi, has generated 400,000 jobs till 2014, according to a report released by the International Renewable Energy Agency (IRENA). If the government reaches its goal of 100 GW of solar photovoltaic (PV) energy and 60 GW of wind energy, the sector could generate a million jobs by 2022.

India has 5.7% of all the people employed in the renewable-energy sector worldwide and is ranked fourth in the world. China ranks first in global renewable-energy employers with 3.4 million, followed by Brazil with more than 0.9 million jobs, USA (0.7 million), India (0.4 million) and Germany (0.3 million).

India has a renewable-energy potential of about 895GW, of which solar alone could generate 750GW. Out of the top 10 countries providing jobs in this sector, five are from are from Asia — China, India, Indonesia, Japan, and Bangladesh.

The solar PV sector in India employs 125,000 people, including both grid-connected and off-grid applications. It is also the largest renewable energy employer in the world, accounting for about 2.5 million jobs. Also, if the government’s target of installing 60 GW wind energy is achieved, India could create up to 183,500 additional jobs in that sector (excluding manufacturing) by 2022, according to the IRENA report.

China leads global employment in solar PV, wind, solar heating and cooling, small and large hydropower, biomass and biogas. Brazil with over 0.8 million jobs is the leading employer in biofuels.

India’s solar PV manufacturers face a stiff competition from suppliers from China, United States, Japan and Germany, according to the IRENA report. In 2014, only 28% of India’s module production capacity and 20% of its cell manufacturing capacity were utilized.

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JA Solar to Establish 500MW Cell & Module Manufacturing Plant in India

JA Solar to establish a 500MW cell and module manufacturing plant in India, it has been confirmed.

In the company’s quarterly results earlier this month, it was briefly mentioned about this agreement with Essel Infraprojects Limited (EIL) . This agreement signed a few days prior to the India-China Business Forum in Shanghai, a trade mission led by Indian Prime Minister Narendra Modi.

Solar was well represented at the high-profile meeting, which resulted in US$22 billion of investment.

Trina Solar has also agreed a 500MW cell and 500MW module production joint venture with India’s Welspun renewables at this event. Canadian Solar has also been thinking about setting up a manufacturing capacity in the country.

As well as placing solar at the heart of his energy policy, Modi is also pushing domestic manufacturing through the Make in India initiative.

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JBM Solar, New Arm of JBM Group

JBM Group

JBM Group to foray into the Solar energy sector. JBM Solar, the new solar arm, will conduct ground-mounted and rooftop power projects. This is the second big diversification by the auto component manufacturer after its bus making facility. JBM group will invest about Rs. 1,600 crore to enter into solar energy sector and it will be funded by a mixture of equity and debt.

“Our 1,600 crore investment in the solar business will comprise 25% equity and 75% debt,” said Nishant Arya, executive director, JBM Group. “The equity element will, initially at least, come from internal accruals.” This 1,600 crore investment will be done over a period of  3 years. JBM Solar plans to generate 300MW of solar power in 3 years. JBM solar will be positioned as an independent power producer. The company will also look to diversify into wind energy and biomass in future. JBM group expects solar to contribute around 15% to its total revenues.

Solar apart, the company is also lining up a capex of around 200 crore for capacity expansion for group company JBM Auto. “We will be enhancing capacity in different locations in FY15-16 and this includes the 100 crore we have earmarked for capacity expansion at our Chennai plants.” The company has four plants in Chennai – 2 at Maraimalainagar and one each in Oragadam and Sriperumbudur. As for the bus division, JBM Auto expects 15% of its revenue to come from this business, said Arya. “We are adding to the topline in FY16,” he said.

 

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Like Powerwall, Panasonic’s Battery Storage Product For Australia

Japanese electronics giant Panasonic is planning to roll-out battery storage products for the Australian electricity market. The move is expected to be announced by next week. Panasonic is a partner in Tesla’s massive ‘Giga-factory’. It is the first large scale battery storage manufacturing plant. Panasonic also provides the battery cells for the Tesla Model S electric vehicle.

panasonic battery

 

Panasonic’s battery storage product are scheduled to be announced on Tuesday in Sydney. It will likely include its now 6.8kWh PV-battery storage system. Panasonic will announce its Australian plans with ‘some of’ Australia’s leading energy Australian retailers.

This follows the announcement by Tesla last month- of its battery storage product, which has been followed by AGL Energy’s teaming up with AU Optronics to deliver a 7.2kWh system into the Queensland market, Trina’s launch of its battery storage system, and expected rollouts from LG, Zen and other providers.

Panasonic also makes solar modules. Panasonic’s battery storage product will be launched at the InterSolar conference in Germany in June.

The dimensions of Panasonic’s battery storage product are 1.4m x 96.6cm x 27.8cm. It is the perfect complement to existing and new solar systems on residential buildings. According to Panasonic, the AC-coupled, single-phase system contains long-established, high-performance lithium-ion batteries from Panasonic and has a storage capacity of 6.8 kWh.

Energy suppliers that are developing ever-increasing decentralized energy supply solutions using third party regenerative systems,  their interests were also taken into account by Panasonic during development phase. By interconnecting and benefiting from private storage systems energy suppliers can increase the flexibility of their energy supply. Storage units contribute to network stability and allow load management, so that investment in the development of local networks can be reduced.

Panasonic made its initial foray into the residential energy storage market of Europe in mid-2012, when it released a 1.35kWh module that was usually sold as a 5.4kWh system (consisting of four such modules). Panasonic seems hopeful about this new product launch at the InterSolar conference in Germany in June.

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Ahmedabad Airport to go Solar

Ahmedabad airport is the latest which has plans to harness solar energy. Airports Authority of India (AAI) is planning to install solar panels on the roof of both domestic and international terminals of Sardar Vallabhbhai Patel international airport in next one year, so that they can bring down operational costs & save on power.

The current consumption of Ahmedabad airport is 25,500MW per year, which on an average costs around Rs 21 crore per year. Hence, the intention of Ahmedabad airport to go solar is going to save huge costs.

Ahmedabad airport power usage:
Power consumption- 25,5000 MW per year
Power cost- Rs 1.75 crore per month on an average (Rs 21 crore per year)

AAI aims to save 6% energy this year. To achieve this target AAI will put in LED lights, solar powered street lights, and five star rating energy appliances and conduct periodic energy audits, besides installing solar panels on the roof. “AAI has decided to implement energy saving initiatives at few airports in the country including Ahmedabad. This year we expect to save 6% energy compared to last year through our energy saving plan. Next year we are targeting at least 8%,” said senior AAI official.

“The process has already begun. Lights on runway have already been replaced with LED lights for energy saving. Next up solar panels will be installed on the top of roofs of both the terminals. The capacity of these solar panels will be of 700 KW which will be used to fulfill the needs of lighting,” said an AAI official.

Plans to bring down power costs:
-Install solar panels on roof of both terminals
-Replace normal lights with LED lights
-Street lights to be made solar powered
-All energy appliances to be of five-star rating

AAI also shuts down lesser needed air conditioners at international terminal during daytime, when there is least flight movement, to save electricity costs. In addition to this, solar powered barbed wires are being installed on the boundary of the airport to keep the monkeys and birds away from entering the airport area.

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Poor Response to Viability Gap Funding Scheme of MNRE

A notification relating to a viability gap funding scheme meant for ‘central public sector undertakings and government of India organisations’ for putting up solar projects has been re-issued by MNRE

The scheme was announced in January, but out of the total capacity of 1,000 MW on offer, only half has been allocated so far.

Viability Gap Funding Scheme promised to grant Rs.1 crore to Central PSUs and  ‘government of India organisations’ that would put up solar plants. The Ministry allocated Rs. 1,000 crore for that purpose. So far, only five organisations have taken up the proposal, including the Solar Energy Corporation of India (SECI) the agency that implements the scheme for a fee. Of the other four, only one – NTPC – is a PSU, the others are the Railways, Khadi Village Industries Commission and the National Institute of Food Technology Entrepreneurship and Management. These five have been allocated capacities totalling 500 MW.

The MNRE has publicised the announcement again, calling the attention of Central PSUs and government of India organisations to it, for the remaining 500 MW.

Notably, the notification of January 16, 2015, mentions NHPC, CIL, NTPC and Indian Railways by way of examples of organisations that may put up solar plants under the scheme.

Under the ‘salient features’ of the scheme it says, “1,000 MW of solar PV power projects would be set up by the Central PSUs and Government of India organisations like NTPC, NHPC, CIL, IREDA, Indian Railways, etc.”

This scheme takes Rs. 6.91 crore a MW as the “estimated project cost”. The viability gap funding comes with a condition that the project developers should buy only locally produced solar cells and modules.

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PTC may Invite Dollar Denominated Bids for Solar Power

ptc india
Power trading company PTC India Ltd is planning to call for dollar based bids from solar project developers on behalf of the ministry of new and renewable energy (MNRE). This move comes in the wake of government’s plan to push solar electricity by paying for it in dollars.
This radical approach by PTC India Ltd is similar to that of state-owned NTPC Ltd which aimed at providing green power at less than Rs.4.50 a unit.
This comes in the backdrop of PTC firming up its renewable energy plans. PTC India Financial Services Ltd (PFS) and International Finance Corporation (IFC) have collaborated to finance green energy projects.
Inviting  dollar denominated bids for solar power, as advocated by energy minister Piyush Goyal, along with sharing of hedging risks, is expected to reduce the solar power rate from around Rs.7 per unit to around Rs. 4.37 per unit, with the firms freed from any foreign exchange risk.
Renewable energy accounts for only 31,692.14 megawatts (MW) of India’s power generation capacity of 267,637MW. India needs as much as $200 billion to meet its target to install 100 gigawatts (GW) of solar power and 60,000MW of wind power by 2022. But securing affordable, long-term and adequate funds has been a challenge for developers of clean-energy projects in India, where interest rates are high.
Shri Goyal has maintained that the government is exploring various financing models for the renewable energy sector.
We had earlier reported that Ministry of New & Renewable Energy (MNRE) is looking at a dollar-denominated tariff mechanism for solar power at grid parity. Read more on that here.
While the present installation cost of a solar project is around Rs.7 crore per MW, economies of scale are expected to drive down the cost to Rs.4.5 crore per MW.
The plan to reduce solar power tariffs comes in the backdrop of state electricity boards (SEBs) increasingly showing a reluctance to buy power on account of their poor financial health. With a debt of Rs.3.04 trillion and losses of Rs.2.52 trillion, SEBs are on the brink of financial collapse.
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Adani to setup 1000 MW Solar Park in Tamil Nadu

Adani Power plans to set up a 1,000-megawatt (MW) Solar Park in Tamil Nadu, after announcing the solar parks in Gujarat and Rajasthan. This solar park is likely to garner Rs 7,000-crore as investment.

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Although an Adani spokesperson declined to comment, a state government official and sources in the company confirmed the development. The sources said a deal had been signed with the state government and the project is at an “exploratory” level.

The solar park is planned to be constructed at Kamuthi in Ramanathapuram district, around 550 km south of Chennai. Adani Power is in the process of acquiring approximately 5,000 acres of land, according to sources.

According to current market prices, to set up a 1 MW  solar-based power plant, the company would need around Rs 7 crore. The present cost of solar power is more than Rs 7 per unit which would come down to Rs 5.45 per unit by next year, according to estimates by experts.

Adani may opt to replicate its Rajasthan model for the solar park in Tamil Nadu. The construction would begin in next 8 months, according to sources.

Adani Enterprises has already entered into an agreement with Rajasthan government to develop solar parks of 10,000 MW capacity in 10 years. This agreement was signed in february between Adani Enterprises & Rajasthan govt. Adani Enterprises is the flagship company of Adani Group.

In January, Adani Enterprises along with SunEdison, announced that they would build a solar photovoltaic manufacturing facility in Mundra, Gujarat. This would be an integrated solar photovoltaic manufacturing facility, with an investment of up to $4 billion (Rs 25,000 crore).

The Tamil Nadu Electricity Board had also said it was planning to procure 3,000 MW of solar power by the end of 2015. According to Tamil Nadu Generation and Distribution Corporation Chairman and Managing Director M Saikumar, above 200 companies have shown interest in signing power-purchase agreements (PPAs) for 2,000 MW so far. Officials also said PPAs (Power Purchase Agreements) for 200MW of solar power had already been signed. These plants are likely to come up at Ramanathapuram, Virudhunagar and Tuticorin districts of Tamil Nadu, the officials added.

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IMF Study: Global Energy Subsidies Will Cost $5.3 Trillion in 2015

The cost of fossil fuels is much higher than previously thought, according to a new study by the International Monetary Fund.

The global post-tax subsidy for energy, which accounts for the environmental and health toll, will be an estimated $5.3 trillion in 2015, more than 6 percent of global GDP. The figure is more than double the IMF’s own post-tax subsidy analysis just a few years ago.

 

IMF, headway solar

Credit: IMF

 

 

The analysis defines post-tax subsidies as the difference between what the consumer pays for energy and its true cost, including environmental and health damages. It also includes a country’s sales tax rate that the authors said should be levied at the point of consumption.

The IMF researchers say the figure is higher than previous estimates because of more refined country-level data on the effects of air pollution and health outcomes of burning fossil fuels. Most of the increase is due to the tracking of a greater range of air pollutants and a more detailed assessment of mortality risks in individual countries.

Coal and petroleum make up the most of the global post-tax energy subsidies. Post-tax subsidies for coal will be nearly 4 percent of global GDP in 2015. Worldwide, coal is undercharged for its environmental impacts, the study states, “yet no country really imposes meaningful taxes on coal use from an environmental perspective.”

Most of the external costs are felt locally, the authors argue, so any reform would accrue to the local population in the form of benefits such as reduced mortality. Eliminating the subsides altogether could reduce carbon-dioxide emissions by more than 20 percent and cut premature global air pollution deaths by 55 percent.

The study’s call for reform is strongest with regards to developing Asia and the Middle East. Developing Asia is responsible for about half of global energy subsides, according to the study. The IMF calls for global coordination on reducing subsidies, but acknowledges that individual countries, such as India, Malaysia, Mexico, Morocco, Thailand and Tunisia, have made strides. From 2011 to 2015, global energy subsides have been cut by $190 billion.

Given current low oil and natural gas prices, it’s a good time to start unpacking energy subsidies, the IMF argues. In the short term, environmental taxes could be the most effective. But the politics are messy.

 

Headway Solar, IMF

Credit: IMF

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