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Renewable Energy Market in India

Findings from a study by Prayag Consulting
Fi di    f         d b P        C    li




 ...
Outline

    Takeaways

    Global energy


    Indian energy scenario

    • Policies and regulations

    Potential f
  ...
Takeaways


 •   India’s sustained efforts in the past two decades are now bearing
     fruit
     f i as renewable energy...
World power report
  •    The maximum power consumed worldwide at any given moment is about
       12.5 trillion watts (te...
Energy Scenario in India

              India’s total installed power capacity stands at 1,47,402.81 MW


            Ther...
Renewable energy in India
Grid-interactive          Estimated        Cumulative
renewable power           Potential (MW)  ...
Policies to promote renewable energy


  •   Preferential tariffs are being reviewed by the State Electricity Regulatory
 ...
Renewable Energy Certificate (REC)


   •     Renewable Energy generators will have two options
          – Either to sell...
Generation-based incentives


  •   Wind
        – Indian government has launched a Generation-based Incentive of INR 0.5/...
WIND ENERGY
Wind energy in India
 •     Wind l t i
       Wi d electric generators of unit sizes b t
                           t     ...
Technology Development and Manufacturing
Base
 Wind Electric Generators are
 manufactured in the country by
 manufacturers...
Opportunity for manufacturers

 •   Expertise is available in plenty
                                                     ...
Market structure in India

   Competitive Market Structure Overview, Wind Turbine Component Segments


                   ...
SOLAR PV
Solar energy in India – bright prospects


     •    India is home to one of the most abundant solar resources in the worl...
Opportunity for manufacturers
 Few players in the market

   • Opportunity for more players to enter the fray
            ...
SMALL HYDRO POWER
Small hydro energy in India
                                              5,415 potential      So far 674 small
          ...
BIOMASS POWER
Biomass energy in India
For the last 15 years, biomass power has become an industry attracting annual
investment of over R...
Sources


 • http://mnes.nic.in/
      p
 • http://www.cwet.tn.nic.in/
 • http://www.ireda.in/
 • http://ahec.org.in/
   h...
Thank you

               For any query, contact:
        Email: enquiries@prayag.com
              Phone: 080-26593328/9
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Renewable Energy Findings Mar 10

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India’s sustained efforts in the past two decades are now bearing fruit as renewable energy and its benefits get accepted and acknowledged.Read the report to learn more.

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Transcript of "Renewable Energy Findings Mar 10"

  1. 1. Renewable Energy Market in India Findings from a study by Prayag Consulting Fi di f d b P C li March 2010
  2. 2. Outline Takeaways Global energy Indian energy scenario • Policies and regulations Potential f P t ti l of renewable energy in India bl i I di Focus on each renewable source/ opportunities • Wind • Solar • Small Hydro • Biomass
  3. 3. Takeaways • India’s sustained efforts in the past two decades are now bearing fruit f i as renewable energy and i b bl d its benefits get accepted and fi d d acknowledged – Emphasis on decentralized energy • Grid-interactive renewable power projects b G id i t ti bl j t based on wind power, d i d biomass, small hydro and solar are mainly private investment driven, with favorable tariff policy regimes established by State Electricity Regulatory Commissions ( g y (SERC) ) – Almost all-renewable power capacity addition during the year has come through this route • India has more mature capabilities in Wind Energy and Small Hydro, while Solar technology is still in the nascent stage • The State Electricity Regulatory Commission (SERC) mandated Renewable Purchase Obligation (RPO), an obligation on States that renewable energy should form some minimum part of the total power consumption
  4. 4. World power report • The maximum power consumed worldwide at any given moment is about 12.5 trillion watts (terawatts, or TW), according to the U.S. Energy Information Administration – Much of it is powered through coal and other sources • A shift towards renewable or clean energies appears to be a viable option in the long run • Examples where renewable energy has made a difference – Wind farms in Denmark generate about 20% of the nation’s electricity – The solar PV (photovoltaic) industry reached more than 2 GW in 2006, making the solar manufacturing and installation industry worth nearly $16 billion – More than half of Americans live in states that have mandated that their utilities generate a specified percentage of electricity (in many cases up to 20% or 25%) from renewable sources such as solar, wind, biomass, and geothermal by a specific target year Did you know? Germany and Spain rank first and second, respectively, in world wind power production
  5. 5. Energy Scenario in India India’s total installed power capacity stands at 1,47,402.81 MW Thermal – Hydro – Renewable energy – Nuclear sources – 93,392 MW 36,647.76 MW 13,242.41 MW 4,120 MW While some progress has been made, renewable energy gy has still a long way to go to make significant impact
  6. 6. Renewable energy in India Grid-interactive Estimated Cumulative renewable power Potential (MW) Achievement (MW) • India established the world’s Wind Power 45,195 10,242.50 first government department Solar Power S l P 50 / k /sq.km. 2.12 /sq.km. 2 12 / k for non conventional energy in 1982, updated to a ministry in Small Hydro Power (up 15,000 2,429.67 1992 and has the largest to 25 MW) renewable energy program in Bio Power (Agro 16,881 703.30 the world residues & Plantations) • The current 8,000 MW of Cogeneration-bagasse 5,000 1,048.73 installed capacity is expected to reach 20,000 MW by 2012 Waste to Energy (Urban 2,700 58.91 (2008) & Industrial) Did you know? The Indian market for clean energy is estimated at $600 million with an annual growth rate of 25 percent (2008)
  7. 7. Policies to promote renewable energy • Preferential tariffs are being reviewed by the State Electricity Regulatory Commissions (ERCs) – Andhra Pradesh, Madhya Pradesh and Maharashtra have announced promotional policies through their respective ERCs • Renewable Purchase Obligation (RPO) is the obligation mandated by the State Electricity Regulatory Commission (SERC) under the Act, to purchase minimum level of renewable energy out of the total consumption in the area of a distribution licensee • This concept has the potential to develop into a marketplace for renewable energy so that states with higher potential can supply power to states with lower or no potential
  8. 8. Renewable Energy Certificate (REC) • Renewable Energy generators will have two options – Either to sell the renewable energy at preferential tariff fixed by the concerned Electricity Regulatory C Commission or – To sell the electricity generation and environmental attributes associated with RE generation separately • On choosing the second option the environmental attributes can be option, exchanged in the form of REC • The Central Agency will issue the REC to RE generators • The Th REC will b exchanged only i th P ill be h d l in the Power E h Exchanges approved bd by CERC within the band of a floor price and a forbearance (ceiling) price to be determined by CERC from time to time • The distribution companies, Open Access consumer, Captive Power Plants (CPPs) will have option of purchasing the REC to meet their Renewable Purchase Obligations (RPO) The government is launching numerous initiatives and policies to increase the generation of renewable energy
  9. 9. Generation-based incentives • Wind – Indian government has launched a Generation-based Incentive of INR 0.5/ kWh over feed-in tariffs for 4GW of new-build – It expects to come online between mid-December 2009 and 31 March 2012 – Will allow the investors, apart from getting the tariff determined by the state investors regulatory commissions, also get an incentive of 50 paise per unit of electricity for a period of 10 years, provided they do not claim the benefit of accelerated depreciation • Solar – Financial assistance of Rs 12 per KW hour in case of solar photovoltaic and Rs 10 per KW hour in case of solar thermal power fed to the electricity grid from a grid interactive solar power plant of a capacity of 1 MWp and above – This incentive will be worked out taking into account the tariff provided by the utility to the solar power producer GBIs are offered by the Government to various forms of renewables over the years to give a boost
  10. 10. WIND ENERGY
  11. 11. Wind energy in India • Wind l t i Wi d electric generators of unit sizes b t t f it i between 225 KW and 1 65 MW h d 1.65 have been deployed across the country State Potential (MW) Installed capacity (MW) 1 Karnataka 11531 1327.4 2 Gujarat 10645 1566.5 3 Andhra Pradesh 8968 122.5 122 5 4 Tamil Nadu 5530 4304.5 5 Rajasthan 4858 738.4 6 Maharashtra 4584 1938.9 1938 9 7 Kerala 1171 27 8 Madhya Pradesh 1019 212.8 Total 48306 10238 Did you know? India is now the fifth largest wind power producer in the world, after USA, Germany, Spain and China
  12. 12. Technology Development and Manufacturing Base Wind Electric Generators are manufactured in the country by manufacturers through • Joint ventures or under licensed production The current annual production capacity of • Subsidiaries of foreign companies under domestic wind turbines is about 3000 MW licensed production • Indian companies with their own technology t h l The trend in recent installations is moving towards • Better aerodynamic design • Use of lighter and larger blades The wind industry has taken up • Higher to ers towers indigenized production of blades blades, gearboxes, yaw components, controllers, • Direct drive etc. • Variable speed gearless operation using advanced power electronics typically to suit moderate wind regime and weak local grid network An indigenization level up to 50% has been achieved in machines
  13. 13. Opportunity for manufacturers • Expertise is available in plenty Major Players in India: • India appears to be a mature market with majority of • Suzlon major players serving the domestic market • Vestas – Suzlon leads the competitors in exporting wind energy • GE equipment • Regen Power Tech • Enercon, Enercon Suzlon and Regen Power Tech are the major • Shriram EPC companies in handling turnkey projects • Enercon India Export: • Indigenously produced wind turbines valued at about US$ 600 million were exported to Australia, Brazil, Portugal, Spain, Turkey and USA during the year • Wind turbines components such as nacelle, Hub, Bolt box assembly, etc of US$ 50 million were exported to USA • Wind turbine blades valued at US$ 5.4 million were exported to China and Japan
  14. 14. Market structure in India Competitive Market Structure Overview, Wind Turbine Component Segments Few players are able to duction facility geographi footprint Global supply full product portfolio, Core set of five or six large scale generator suppliers Bearings serving multiple industries mainly exporting from with expanding global regional hubs, with new production networks, while ic t t entrants emergingi several pitch and yaw suppliers entering Generators Consolidated group of Regional large scale suppliers are Proliferation of local Gear boxes under pressure as regional suppliers as new players scale markets scale R Blades One large independent supplier, several small-scale regional Towers players contending cal with in-house Loc Prod production Fragmented Concentrated Consolidated Market Concentration Source: Emerging Energy Research, Wind Turbine Supply Chain Strategies, 2009-2020
  15. 15. SOLAR PV
  16. 16. Solar energy in India – bright prospects • India is home to one of the most abundant solar resources in the world, with 2.97 million square kilometers of tropical and subtropical land and an average of 250-300 clear sunny days a year • Nascent segment to explore – Solar-based Solar based energy accounts for only 0 5% of installed base with a grid interactive (grid hybrid) 0.5% grid-interactive (grid-hybrid) solar power totaling only 2.12 MW from just 33 installations • Government continuing with the demonstration programmes on grid connected solar photovoltaic (SPV) power generation Indian Government’s future plans: • India is planning to boost output from near zero to 20 GW by 2020 $19B plan aims to kick-start solar industry in India • Money would be spent on incentives for production and installation as well as research and development If fully implemented, solar power would be equivalent to one-eighth of India's current installed power base Includes large-scale deployment of solar generated power for both grid connected as well as distributed d decentralised off-grid provision of commercial energy services di t ib t d and d t li d ff id i i f i l i • The move could unlock India's huge renewables potential and benefit companies such as Tata BP Solar, a joint venture between Tata Power and BP plc's solar unit, BP Solar, and Bharat Heavy Electricals Ltd and Lanco Infratech Did you know? The world now produces about 14 GW of solar power, about half of it added last year
  17. 17. Opportunity for manufacturers Few players in the market • Opportunity for more players to enter the fray j y Major Players in India: The price of solar electricity in India is still about 3 times • Tata BP Solar that of traditional grid electricity • Moser Baer • Signet Solara • New players have to come with a lot of value engineering that drive the capital intensity to lower side Significant potential to tap into Huge opportunity for European technology Current scenario: Nearly 75 per cent of Tata BP Solar sales come from exports largely to Europe and the U.S Growth plans include expansion of its module manufacturing facility and thrust on domestic sales The latest company that has evinced interest in setting up a unit in the Fab City is BHEL, which will be C investing Rs 500 crore • Much of the activity seems to be focused currently on manufacturing — with the manufacturers themselves possibly offering d i th l ibl ff i design, i t ll ti and monitoring services as well installation d it i i ll • Expected to change in favor of a growing service industry
  18. 18. SMALL HYDRO POWER
  19. 19. Small hydro energy in India 5,415 potential So far 674 small sites with an hydropower aggregate capacity projects of 14,292 MW aggregating to have been about 2 430 MW 2,430 identified have been set up • Out of this in various parts of potential about the country Most of the 50% lies in • Out of this174 potential i i t ti l is in The i bilit f Th viability of Arunachal private sector Himalayan States these projects Pradesh, SHP projects as river-based improves with Himachal with an projects and in increase in the Pradesh, Jammu aggregate other States on station capacity & Kashmir and capacity of about irrigation canals Uttarakhand. 887 MW have Chhattisgarh, been set up Karnataka, mainly in Andhra Kerala and Pradesh, Maharashtra Himachal Pradesh, Karnataka, K t k Maharashtra, Punjab and Uttarakhand Technology is well established in India
  20. 20. BIOMASS POWER
  21. 21. Biomass energy in India For the last 15 years, biomass power has become an industry attracting annual investment of over Rs.1000 crores, generating more than 9 billion units of electricity per year and creating employment opportunities in rural areas Estimated biomass power potential is about 21,000 MW By using these surplus agricultural residues, residues more than 16,000 MW Biomass power projects with an aggregate capacity Bi j t ith t it of grid quality power of 703 MW through 102 projects have been installed can be generated with presently available in the country technologies 5000 MW of power can be produced, if all the 550 sugar mills in the country switch over to modern techniques of co- co generation
  22. 22. Sources • http://mnes.nic.in/ p • http://www.cwet.tn.nic.in/ • http://www.ireda.in/ • http://ahec.org.in/ htt // h i / • http://pibmumbai.gov.in/scripts/detail.asp?releaseI d=E2010PR88 • http://www.indiacore.com/renewable-energy.html • http://www.business- standard.com/india/news/government-launches- standard com/india/news/government launches incentive-scheme-for-wind-energy- projects/379955/
  23. 23. Thank you For any query, contact: Email: enquiries@prayag.com Phone: 080-26593328/9
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