The document discusses new environmental norms for thermal power stations in India that aim to reduce emissions. It notes that India has committed to reducing emission intensity, increasing non-fossil fuel capacity, and making power generation more efficient. The new norms effective after 2017 will set stricter standards for SPM, SO2, NOx, Hg and water use. Compliance will require additional capital investments of Rs. 1.15-2.5 crore per MW for technologies like FGD and SCR. Regulators will need to determine cost recovery mechanisms and provide guidance on optimal compliance technologies and schedules.

1. Together, let us light up our lives.
Regulatory implications of New
Environmental norms for
Thermal Power Stations
By
Priyabrata Patnaik,
Director (Regulatory Affairs)
Odisha Electricity Regulatory Commission
Together, let us light up our lives.

2. Together, let us light up our lives.
Requirements of New Environmental
Norms for Thermal Power Stations
• India responsible for 4% emission, China and USA for 40%
emission.
• To safeguard the environment and to reduce carbon
emission from power sector India has made the following
commitment in COP 21.
– Reduce emission intensity of GDP by 33-35% by year
2030 from 2005 level.
– 40% cumulative installed capacity from non-fossil fuel
by 2030.
– Introducing more efficient technology in thermal power
generation.
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Contribution of TPS in Industrial Emission
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New Environmental Norms
• Environment (protection) Amendment Rules,
2015 came into force on 07.12.2015. It will be
effective after December, 2017.
• New Environment Norm
– SPM
– SO2 (FGD)
– Nox (SCRS)
– Hg
– Fresh water use
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Additional Capitalisation
• 163 IPPs as on 30.06.2016 out of which 5 IPPs are in Odisha.
• CERC estimated CAPEX ranging from Rs.1.15 crore – Rs.2.5 crore
/ MW with tariff increase ranging from 40 to 90 paise per unit.
• CERC on 19.08.2016 advised Central Government under Section 79
(2) of the Electricity Act.
– Plant having residual life <10 years after R&M and life
extension and those commissioned prior to 01.01.2004 may be
exempted.
– New norms may be applicable w.e.f. 01.01.2020.
– BSP will be increased ranging from Rs.0.40 to Rs.0.90 per unit.
Govt. to provide subsidy from National Clean Energy Fund or
Clean Energy Cess.
• CGPs to pass the burden through their products.
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Regulatory Framework
• Additional capitalization is possible due to change in law both
before and after cut off date as per CERC and OERC Regulation.
• Change of law can be considered by the Commission under Section
62 and 63 of the Act.
• Scheduling of the Power plant
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Technology Construction
time
Downtime
Electrostatic precipitator (ESP) ~ 3–6 months ~ 20–30 days
Flue gas desulphurization (FGD) ~ 18–24 months ~ 30–90 days
Selective Catalyst Reduction (SCR) ~ 5 months ~ 30 days
Selective Non-Catalyst Reduction (SNCR) ~ 4 months ~ 7 days
Low NOx burner, OFA etc. ~ 1 month ~ 15–20 days

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Phasing of Implementation
• In Petition No. 72/2016 dated 20.03.2017 CERC in Maithon
Power Ltd. case directed that the applicant must approach
CEA to decide optimum technology and associated cost,
approach Environmental Ministry for Phasing of
Implementation.
• CEA has given 300 power plants deadline and from 2020 –
2024 to use FGD technology. CEA has given six plants the
deadline of 2019.
• Section 5 of the Environmental Protection Act, 1986
empowers Govt. for case to case decision.
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Optimum Technology
• As per CSE, FGD technology is not helpful for
fostering clean coal technology. It only contains acid
rain.
• Multi-pollutant capture technology instead of single
technology for each pollutant used in China.
• CSE estimated Rs.1.10 crore - Rs.1.45 crore per MW
for multi-pollutant capture technology.
• FGD technology cost Rs.50 to Rs.75 lakh per MW.
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Road Ahead
• CEA/CERC should give guidance on technology
options, pollution control performance and costs
benchmarks. While capex is project-specific, broad
guidelines will help in assessment and approvals.
• Regulators may need to devise mechanism to stagger
tariff increases. But, plants need an assured rate
increase to help raise financing for the capex and to
avoid cash flow problems.
• Change in operational parameters such as station heat
rate and auxiliary power consumption can be
managed.
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For Patient Hearing