Commercial viability analysis for solar thermal power 2003-pps

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  • Commercial technologies have 1000 hrs of mean time between failure at least .
  • Commercial viability analysis for solar thermal power 2003-pps

    1. 1. Commercial Viability Analysis for Solar thermal Power Generation Systems under New Market and Regulatory developments in India Final Semester Major Project Report Presented by – Anudeep Yadav Roll No 10
    2. 2. Content <ul><li>Solar Energy - A Promising Energy Source for India. </li></ul><ul><li>Solar Thermal Power Generation-Global Achievements So Far. </li></ul><ul><li>Solar Thermal Power Generation-India’s Experience. </li></ul><ul><li>Jawaharlal Nehru National Solar Mission-Renewed focus. </li></ul><ul><li>Concentrated Solar Power –Commercial Tech. </li></ul><ul><li>Concentrated Solar Power -Indian Market & Regulatory Proposals. </li></ul><ul><li>Concentrated Solar Power-Key Indian Project Proposals </li></ul><ul><li>Technical Issues </li></ul><ul><li>Economic Issues </li></ul><ul><li>Recommendations </li></ul>Anudeep Yadav ;Roll no 10; MBA-Power Management,NPTI
    3. 3. Solar Energy - A Promising Energy Source for India Anudeep Yadav ;Roll no 10; MBA-Power Management,NPTI <ul><li>Annual global radiation varies from 1600 to 2200 kWh/m2 </li></ul><ul><li>The direct normal insolation (DNI) over Rajasthan varies from 1800 kWh/m2 to 2600 kWh/m2 . </li></ul><ul><li>5 trillion kWh/year theoretical potential </li></ul><ul><li>Sunny areas </li></ul><ul><ul><li>Most of the country receives more than 4kWh/m 2 /day </li></ul></ul><ul><ul><li>Average of 300 sunny days in the most part of the country </li></ul></ul><ul><li>Theoretically </li></ul><ul><li>If one percent of the land is used to harness solar energy for electricity generation at an overall efficiency of 10%; </li></ul><ul><li>492 x 10 6 MU/year electricity can be generated . </li></ul><ul><li>* TERI Calculations </li></ul>
    4. 4. Solar Thermal Power Generation-Global Achievements So Far Anudeep Yadav ;Roll no 10; MBA-Power Management,NPTI *Courtesy DLR- IEA 2009 Report Total Installed Capacity ~ 600 MW Troughs- Most mature Tech. Towers Next in line Dish - Yet to be Demonstrated. USA and Spain are the key Markets to look forward to. *
    5. 5. Solar Thermal Power Generation-India’s Experience <ul><li>Indigenous Attempt </li></ul><ul><li>By MNES ,parabolic trough collector technology (line focusing) at Gwalpahari, Gurgaon. </li></ul><ul><li>50kW capacity </li></ul><ul><li>Commissioned in 1989 and operated till 1990 ;Shut down due to lack of spares </li></ul>Anudeep Yadav ;Roll no 10; MBA-Power Management,NPTI <ul><li>Integrated Solar Combined Cycle Power Plant ,140MW (Mathania) Raj. 35MW Solar </li></ul><ul><ul><li>Began the GEF work program in 1996. * </li></ul></ul><ul><ul><li>GEF contribution of US$49 million; a total financing volume of US$245 million (GoI and KfW, and executed by KfW) </li></ul></ul><ul><ul><li>Prequalification in 2001; 1 international, BHEL and L &T ( both with SOLEL). </li></ul></ul><ul><ul><li>Only BHEL , L&T remained finally. Techno economic difficulty, none submitted. </li></ul></ul><ul><li>STATUS (as reported by Magazine “Project Monitor” on 3 r d April 2006) </li></ul><ul><ul><li>International Funds are transferred to some other project. </li></ul></ul><ul><ul><li>Project needs revised techno-economic feasibility study. </li></ul></ul><ul><ul><li>RRECL has not been able to sign Gas Supply Agreement with GAIL. </li></ul></ul>*www.Solarpaces.org Shelved and now Reopened Again
    6. 6. Jawaharlal Nehru National Solar Mission-Renewed focus on solar <ul><li>3-phase approach </li></ul><ul><ul><li>Up to 2012-13 as Phase 1. installed Cap - 1100 MW </li></ul></ul><ul><ul><li>From 2013-17 as Phase 2. installed Cap - 4000 MW </li></ul></ul><ul><ul><li>From 2017-22 as Phase 3. installed Cap -20000 MW </li></ul></ul><ul><li>Demonstration projects in Phase I </li></ul><ul><ul><li>50-100 MW Solar thermal plant with 4-6 hours’ storage (plant load factor up to 40%). </li></ul></ul><ul><ul><li>A 100-MW capacity parabolic trough technology based solar thermal plant. </li></ul></ul><ul><ul><li>A 100-150 MW Solar hybrid plant with coal, gas or bio-mass to address variability and space-constraints. </li></ul></ul><ul><li>Promotion proposals. </li></ul><ul><ul><li>Local demand creation, right incentives & large government pilot/demonstration programs. </li></ul></ul><ul><ul><li>Financing & Incentives , import duty, low rate loans, priority sector lending etc </li></ul></ul>Anudeep Yadav ;Roll no 10; MBA-Power Management,NPTI
    7. 7. Concentrated Solar Power Commercial Tech <ul><li>CSP Trough </li></ul><ul><ul><li>Most mature commercial technology </li></ul></ul><ul><ul><li>Latest Functional Plant </li></ul></ul><ul><ul><li>Andasol (Spain) </li></ul></ul><ul><ul><ul><li>3 x 49.9 Mwe </li></ul></ul></ul><ul><ul><ul><li>Solar to Electrical Eff 16 % </li></ul></ul></ul><ul><ul><ul><li>7.5 full load hours Storage. Annual CUF – 40 % </li></ul></ul></ul><ul><ul><ul><li>Investment ~ 750 million Euro ; 80 % debt financed </li></ul></ul></ul><ul><ul><ul><li>Approx 32 crores/MW; Tariff ~Rs 17.5/unit </li></ul></ul></ul><ul><ul><ul><li>512000 m2 / 200 Ha of collectors /plant. </li></ul></ul></ul><ul><ul><ul><li>50 member permanent Staff. </li></ul></ul></ul>Anudeep Yadav ;Roll no 10; MBA-Power Management,NPTI *Solar Millennium LLC & Flagsol *
    8. 8. Concentrated Solar Power Commercial Tech- Contd <ul><li>Solar Tower –second most mature commercial Tech. </li></ul><ul><li>Latest Functional Plants – PS 10, PS20 ( Spain) </li></ul><ul><ul><ul><li>11 MW Sat Steam Rx, 1 hour Storage, backup NG ( 15%) </li></ul></ul></ul><ul><ul><ul><li>Solar resource- 2102 KWh/m2/yr ; Land 55 Ha </li></ul></ul></ul><ul><ul><ul><li>Tariff – 27.12Euro cent/KWh , 25 yrs PPA. </li></ul></ul></ul><ul><ul><ul><li>Solar to Elect Efficiency – 21.4%. </li></ul></ul></ul><ul><ul><ul><li>Plant Cost – 33 Million Euro , Rs~ 19.5Crore /MW. </li></ul></ul></ul>Anudeep Yadav ;Roll no 10; MBA-Power Management,NPTI
    9. 9. Concentrated Solar Power -Indian Market & Regulatory Proposals <ul><li>Incentives are mutually exclusive between State policies and MNRE. </li></ul><ul><li>MNRE , GBI Scheme </li></ul><ul><ul><li>Limited to total of 50 MW, 10 MW/state and 5 MW/ developer. Policy limited to 1 year with revision on annual basis. </li></ul></ul><ul><ul><li>Not avail with Acc Depreciation. </li></ul></ul><ul><ul><li>No backup fuel allowed. </li></ul></ul><ul><ul><li>Max Period of 10 yr. </li></ul></ul><ul><ul><li>Connected to PPA with Utility with cap of Rs 9.5/unit. </li></ul></ul><ul><li>State of Gujarat </li></ul><ul><ul><li>Not available for MNRE facilitated projects. </li></ul></ul><ul><ul><li>Valid for 500MW of Capacity , min cap of 5 MW. </li></ul></ul><ul><ul><li>Valid upto March 2014. </li></ul></ul><ul><ul><li>No Fossil fuel allowed. </li></ul></ul><ul><ul><li>No Electricity duty. </li></ul></ul><ul><ul><li>Tariff of 9 Rs /unit for 12yrs. </li></ul></ul><ul><ul><li>Specifies penalty for Discom to fail meet RPO @ Rs 12/unit. </li></ul></ul>Anudeep Yadav ;Roll no 10; MBA-Power Management,NPTI <ul><li>State of Rajasthan </li></ul><ul><ul><li>Ten year Promotional Tariff ( incl. GBI) to be Rs 13.18/unit. </li></ul></ul><ul><ul><li>Plans to establish a Solar Energy Enterprises Zone (SEEZ) in the districts of Barmer, Jaisalmer and Jodhpur by offering a package of incentives to private investors. </li></ul></ul>Back
    10. 10. Concentrated Solar Power -Indian Market & Regulatory Proposals-contd. <ul><li>CERC Solar Thermal T &C for Tariff. </li></ul><ul><ul><li>Benchmark Capital Cost Norm Rs 1530 Lakhs/MW </li></ul></ul><ul><ul><li>Tariff Period- 25 yrs. </li></ul></ul><ul><ul><li>Land Costs- 0.18 crores/MW ( @ 6 Acre/MW,3L/Acre). </li></ul></ul><ul><ul><li>Loan Tenure- 10 years. </li></ul></ul><ul><ul><li>Normative CUF- 23 % </li></ul></ul><ul><ul><li>Depreciation- 7 % ( 1 st 10 yrs) </li></ul></ul><ul><ul><li>RoE – 19% and 24 % </li></ul></ul><ul><ul><li>O & M Expenses 13Lakh/MW </li></ul></ul><ul><ul><li>Aux Cons – 10 % </li></ul></ul>Anudeep Yadav ;Roll no 10; MBA-Power Management,NPTI
    11. 11. Concentrated Solar Power-Indian Project Proposals <ul><li>10 MW SOLAR THERMAL Tower Power Project Acme Telepower, (Bikaner )Rajasthan. </li></ul><ul><li>Uses Esolar’s new technology. </li></ul><ul><ul><li>Not yet proved. </li></ul></ul><ul><ul><li>Pilot Plant of 2.5 x2 ( 5 MW) Operational since last year. </li></ul></ul><ul><ul><li>No Performance Data yet available. </li></ul></ul>Anudeep Yadav ;Roll no 10; MBA-Power Management,NPTI
    12. 12. Concentrated Solar Power-Indian Project Proposals- Contd <ul><li>Solar Thermal Power Plant at Bap, Jodhpur, Rajasthan based on Parabolic dish-sterling technology. </li></ul><ul><li>Modular 3kW 3340 systems </li></ul><ul><li>Total Cap . 10 MW </li></ul><ul><li>Land Requirement - 70 Acres. </li></ul><ul><li>EPC Contractor - INFINIA Corp, </li></ul><ul><li>USA </li></ul><ul><li>back </li></ul>Anudeep Yadav ;Roll no 10; MBA-Power Management,NPTI
    13. 13. Technical Issues <ul><li>Major Cost Forecasts Base </li></ul><ul><ul><li>Sargent & Lundy Cost & Performance Forecast. </li></ul></ul><ul><ul><ul><li>Allocated cost reduction due to </li></ul></ul></ul><ul><ul><ul><li>Volume production (learning and improvements in manufacturing) </li></ul></ul></ul><ul><ul><ul><li>Plant scale-up (increasing size), and </li></ul></ul></ul><ul><ul><ul><li>Technology advances (RD&D) </li></ul></ul></ul><ul><ul><ul><li>Assumes cost in range of Rs 6/unit to Rs 4.5/unit. </li></ul></ul></ul><ul><ul><ul><li>Tower Plants overtake the cheapest source from trough plants before 2010. </li></ul></ul></ul>Anudeep Yadav ;Roll no 10; MBA-Power Management,NPTI <ul><li>Problems </li></ul><ul><ul><li>Assumed increased deployment hasn’t been found to happen. </li></ul></ul><ul><ul><li>Costs in regions of SW USA or Upper EGYPT inc by at least 30 % when in regions like India.* </li></ul></ul><ul><ul><li>Technology cost forecasts for tower are proved mistaken. </li></ul></ul><ul><ul><li>Major Costs of Tower Plants </li></ul></ul><ul><ul><li>Tech – 23% </li></ul></ul><ul><ul><li>Scale up & Volume Prod. </li></ul></ul><ul><ul><li>*Greenpeace Solar Outlook </li></ul></ul>
    14. 14. Technical Issues-Contd. <ul><li>Insolation Level Measurement of specific sites. </li></ul><ul><li>Use of New Unproved Technologies in tower systems. </li></ul><ul><li>Unviable small scale plants. ( 5 – 10 MW)* </li></ul><ul><li>Extent of indigenization is not high. </li></ul><ul><ul><li>Structures (precision assembly) </li></ul></ul><ul><ul><li>Power Block (specialized turbine) </li></ul></ul><ul><ul><li>Receiver/ Receiver tubes(very specialized ) </li></ul></ul><ul><ul><li>Mirror surfaces/heliostats- doubtful(specialized low thickness upto 2 mm,hi reflectivity 92%,light weight) </li></ul></ul>Anudeep Yadav ;Roll no 10; MBA-Power Management,NPTI <ul><li>Unreliable Dish Stirling Systems </li></ul><ul><ul><li>No utility scale plant online yet. </li></ul></ul><ul><ul><li>Highest Land requirements (10 – 20 acre/Mw) , even more than PV . </li></ul></ul><ul><ul><li>Infinia corp. haven't yet delivered high efficiencies. </li></ul></ul><ul><ul><li>Major issues with maintenance, mean time between failure is reported to be around 40 hrs in a testimony of expert before US Energy Commision. </li></ul></ul>* Expert Opinion,Sandia Labs
    15. 15. Economic Issues <ul><li>Capital Costs </li></ul><ul><ul><li>Technology of proposed projects. 1 </li></ul></ul><ul><ul><li>Capital costs – Min .15.9 Crores (w / capital subsidy)* </li></ul></ul><ul><ul><li>O & M Costs – Conn. to Capacity^; Staff Training </li></ul></ul><ul><li>Capacity Utilization </li></ul><ul><ul><li>Actual values depend on </li></ul></ul><ul><ul><ul><li>Insolation </li></ul></ul></ul><ul><ul><ul><li>Extent of Storage </li></ul></ul></ul><ul><ul><ul><li>Backup Fuel Allowances </li></ul></ul></ul><ul><ul><li>Best Case Values are around 15 to 21 % </li></ul></ul>Anudeep Yadav ;Roll no 10; MBA-Power Management,NPTI * Data on Executed Tower Project in Spain ,Aus Govt Report on HTSP Roadmap ^ based on Experiences in US SEGS plants. 8%-to- 2 % Points Loss
    16. 16. Economic Issues-Contd <ul><li>Hidden costs </li></ul><ul><ul><li>Land development. </li></ul></ul><ul><ul><ul><li>Slope of land is key issue. ( 1%) </li></ul></ul></ul><ul><ul><ul><li>Continuous areas of sufficient solar field as per requirement should be available. </li></ul></ul></ul><ul><li>Effect of Land level in design of PS 10 ,Spain </li></ul>Anudeep Yadav ;Roll no 10; MBA-Power Management,NPTI <ul><li>USA CSP Resource Potential before applying filters of </li></ul><ul><ul><li>Land slope </li></ul></ul><ul><ul><li>Continuous Land availability. </li></ul></ul><ul><ul><li>DNI value </li></ul></ul><ul><li>USA CSP Resource Potential After applying filters of </li></ul><ul><ul><li>Land slope <= 1% </li></ul></ul><ul><ul><li>Continuous Land availability.- 10 Kms </li></ul></ul><ul><ul><li>DNI value - 6.75 Kwh/m2/day </li></ul></ul>
    17. 17. Economic Issues-Contd <ul><li>Incentives mismatch </li></ul><ul><ul><li>USA </li></ul></ul><ul><ul><ul><ul><li>Renewable portfolio standards of 20 to 30 % </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Federal Cash Grant of 30 % of expenditures, eligible to commercial systems. </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Commercial/Residential Tax Credit- not avail. With grant, income tax liability net of local grants. </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Federal Corp. Depreciation :- Accelerated upto the level of 50 % in first year ,also called as Modified Accelerated Cost-Recovery System (MACRS), classifies several renewable projects as 5 year property. </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Federal Loan guarantee Program:- </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Allows guarantees for long term repayments upto 90 % useful life or 30 years. </li></ul></ul></ul></ul>Anudeep Yadav ;Roll no 10; MBA-Power Management,NPTI <ul><li>Incentives mismatch </li></ul><ul><ul><li>Spain </li></ul></ul><ul><ul><ul><ul><li>Solar thermal focused special regulations.attracted 800 Mwe Plants. </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Special mechanism of high feed in tariffs provided along with capital subsidies from state govt.s and EU </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Option 1 – fix tariff of 0.28 Euro/unit. </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Option 2 – combination of market price ~ 0.16euro +premium upto 0.26 euro /unit subject to min (0.26 euro) and max (0.35 euro), 25 yrs., then 80 % </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Allowance of Fossil Fuel backup upto 15 %. </li></ul></ul></ul></ul><ul><li>Incentives mismatch </li></ul><ul><ul><ul><ul><li>India </li></ul></ul></ul></ul>
    18. 18. Recommendations <ul><li>The Actual Assumptions based on Study analysis gives the tariff in ranges of Rs 27 – 22/unit. </li></ul><ul><ul><li>Capital costs ranging 16 to 19 crores/MW. </li></ul></ul><ul><ul><li>O &M Costs indexed to Capital costs. ( ~ 2 %). </li></ul></ul><ul><ul><li>Lower CUFs ( 18 to 21 %). </li></ul></ul><ul><ul><li>Motive to produce reliable and dispatch able capacities. </li></ul></ul>Anudeep Yadav ;Roll no 10; MBA-Power Management,NPTI <ul><li>Key Parameters having effect on tariffs are </li></ul><ul><ul><li>CUF. </li></ul></ul><ul><ul><li>Loan Interest Rates. </li></ul></ul><ul><ul><li>Loan Tenure. </li></ul></ul><ul><ul><li>Capital subsidy. </li></ul></ul><ul><li>Allow Fossil fuel back up with fixed percentages(10-15%). </li></ul><ul><li>Provide for state support and incentives for larger scale plants for establishing utility scale plants. </li></ul><ul><li>Small Scale demonstrator plants should be setup with state as minority stakeholder to establish Life Cycle Costs to set up accurate T & C of Tariff. </li></ul><ul><li>Develop a holistic approach for development of reliable power source, providing scope for storage . </li></ul><ul><li>Prepare detailed DNI database for prospective Solar thermal Sites. </li></ul>
    19. 19. <ul><li>Queries are welcome ! </li></ul>Anudeep Yadav ;Roll no 10; MBA-Power Management,NPTI <ul><li>Ministry of New and Renewable Energy sources, http://mnes.nic.in/pdf/mission-document-JNNSM.pdf </li></ul><ul><li>Central electricity regulatory commission, www.cercind.gov.in </li></ul><ul><li>Various status reports of previous developments in solar thermal power generation across the world; www.osti.gov/energycitations </li></ul><ul><li>Communications with Dr. Tom Mancini, CSP program Director , Sandia Labs USA </li></ul><ul><li>SOLARPACES website, for detailed study reports, http://www.solarpaces.org/CSP_Technology/docs </li></ul><ul><li>Concentrating Solar Power Reports, http://ec.europa.eu/energy/res/publications/doc/ </li></ul><ul><li>Esolar’s website; http://www.esolar.com/sierra_fact_sheet.pdf </li></ul><ul><li>Estella Solar; http://www.estelasolar.eu/fileadmin/ESTELAdocs/documents </li></ul><ul><li>Rajasthan Electricity regulatory commission ; http://www.rerc.gov.in/Order/Tariff_for_Solar_Power_Order2APR08.pdf </li></ul><ul><li>Presentations by Rainer Aringhoff, President Solar Millenium LLC, Berkley; 10 /1/2008 Final Report on “ Technical data, costs, and life cycle inventories of solar thermal power plants&quot; by Peter Viebahn, Stefan Kronshage, Franz Trieb (DLR), Yolanda Lechon (CIEMAT) funded EU , release 2008. </li></ul><ul><li>  </li></ul><ul><li>National Renewable Energy Labs online library for accessing various reports including Sargent and Lundy's analysis; http://www.nrel.gov/csp/troughnet/pdfs/2007 to 2009 . </li></ul><ul><li>  </li></ul><ul><li>Green peace report on solar thermal http://www.greenpeace.org/raw/content/international/press/reports/concentrating-solar-power-2009.pdf </li></ul><ul><li>IEA website reports on CSP; http://www.iea.org/papers/2009/CSP_Brochure.pdf </li></ul><ul><li>World bank’s Global Environmental Facility Report on status of solar thermal plants, 2005. </li></ul><ul><li>HIGH TEMPERATURE SOLAR THERMAL TECHNOLOGY ROADMAP for Australia, by Wyld Group Pty Ltd for Australian states of Victoria and New South wales; 2008 . </li></ul><ul><li>European Commission (2007), Concentrating Solar Power: Main Projects document; Supported By The Commission , Brussels. </li></ul>References
    20. 20. Major Modified Assumptions according to Real project experiences .(Tower) <ul><li>Capital Costs- 15.9 Cr/MW and more. </li></ul><ul><li>O &M Costs- 2% - 2.5% of Cap Costs. </li></ul><ul><li>C U F 19 % </li></ul><ul><li>back </li></ul>Anudeep Yadav ;Roll no 10; MBA-Power Management,NPTI

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