The agricultural sector in the country is distressed, water scarcity being a major reason. The agrarian
distress is also intertwined with the woes in the power distribution sector. Of major importance to
development, solving these deeply connected issues will require a holistic approach. The recently
announced KUSUM scheme by the Ministry of New and Renewable Energy (MNRE) attempts to address
some of these issues.
KUSUM is presented as a scheme that primarily aims at benefiting farmers.
Present scenario of Renewable Energy in BangladeshMustafa Momin
This presentation contains current scenario of Bangladesh renewable energy sector as of 29th May, 2017. It contains the feasibility of solar power plant in Bangladesh, government's initiative, latest government plans for solar and other renewable energy, simple financial calculation of solar power plant. There is contact address is given, so it's possible to communicate further if more recent and detail information is needed.
Large Scale Grid Integration of Renewable Energy Sources - Way ForwardSpark Network
A detailed report on the recommended methodology for the effective integration of Renewable Energy Projects with the Grid has been published by Central Electricity Authority.
Present scenario of Renewable Energy in BangladeshMustafa Momin
This presentation contains current scenario of Bangladesh renewable energy sector as of 29th May, 2017. It contains the feasibility of solar power plant in Bangladesh, government's initiative, latest government plans for solar and other renewable energy, simple financial calculation of solar power plant. There is contact address is given, so it's possible to communicate further if more recent and detail information is needed.
Large Scale Grid Integration of Renewable Energy Sources - Way ForwardSpark Network
A detailed report on the recommended methodology for the effective integration of Renewable Energy Projects with the Grid has been published by Central Electricity Authority.
These slides present at an introduction level about the demand side management and demand response in smart micro-grid system. Later mathematical modelling and detail on optimization techniques will be covered.
This presentation gives a brief about the Indian Power sector. It covers evolution, growth, major players of Power sectors. Also, it focuses various acts, regulations and tariffs related to it. The important part is issues which are there in Power sector and we have made an attempt to provide recommendations for the same.
Renewable Energy Sources are being used in Off-Grid mode. By integrating all these sources to a common point energy efficiency can be improved and frequent dynamic faults can be avoided. This approach needs to implement smart grid and technologies.
The world has already used her non-renewable resources. It will take 100 of years to recharge. But as Bangladesh is a land of beauty, she has a lot of renewable resources. If all of them can be utilized properly, our dependency on non-renewable resources will be vanished.
MODELLING AND PERFORMANCE ANALYSIS OF BIFACIAL SOLAR PVvikaspanch
SOLAR PHOTOVOLTAIC TECHNOLOGY
It is an new emergent technology in solar panels which unlike conventional P.V. panels collects sunlight from not only front side but rear side also.
This is done by capturing light reflected from the surface beneath the module and from the environment.
Thus using both direct and diffused light.
APPLICATIONS:
BUILDINGS
PARKING
HIGHWAYS LININGS
ROOFTOPS
SNOW COVERED AREAS
MERITS:
Increase in generation
Reduction in installation area
Reduction in overall cost
Wide range of application
Pay back period and cost base analysis of solar PV LanternMalik Sameeullah
Financial analysis tool is used to find out the financial feasibility of solar Photo voltaic Lantern. Topic used simple financial tool with self explanatory formula and explain financial analysis of SPV lantern. It is easy to understand the financial analysis specially for beginner.
Solar Parks are becoming increasingly popular & MNRE is leaving no stone unturned to make them a success.
The ppt mentions the nuts & bolts of the Solar Park Scheme of MNRE.
Renewable energy integration and energy storage Bushveld Energy
Presentation by Bushveld Energy at the Power Transmission Africa conference on the topic of renewable energy integration and storage. The presentation covers the role that battery storage can play to reduce the costs and challenges for transmission and distribution networks in incorporation large amounts of renewable energy. The presentation sites a few examples and focuses on Africa, in particular.
ELECTRICITY SUBSIDY AND A JUST ENERGY TRANSITION IN TAMIL NADUAurovilleConsulting
To address climate change, to promote adaptation and resilience, to eliminate energy poverty, and to ensure a just energy transition, countries and states will have to mobilise substantial financial resources. A recent study estimated that India will need to invest a 900 billion USD over the next 30 years to ensure a ‘just energy transition’ (Bushan 2023). While developed countries have pledged to provide climate finance to developing countries, these pledges have not been fulfilled, or are very slow to arrive, or are insufficient. Developing countries will need to find additional and alternative resources to accelerate the decarbonization of its economies and to invest into climate adaptation. The United Nations (2022) has outlined a few interventions that can help in accelerating a just energy transition. These include:
to make renewable energy technologies a public good,
to shift energy subsidies from fossil fuels to renewable energy, and
to triple investments into renewables.
In 2009, G20 members committed to phasing out and rationalizing fossil fuel subsidies in the medium term (Reuters 2009). But as of 2022, fossil fuel subsidies have not been phased out, neither have they been reduced; instead, fossil fuel subsidies exceeded USD 1 trillion globally for the first time. This is largely due to governments’ increased subsidies to cushion consumers from rising energy prices (IISD 2023).
Energy subsidies are found in virtually every country. Justifications for their use range from social welfare protection, job creation, encouragement of renewable energy sources, promotion of economic development, to energy security. However, it may be worth examining some of the current energy subsidy schemes asking if and to what extent these subsidy schemes are contributing to a just energy transition and to what extent these subsidies align with the proposed three interventions by the UN.
Read the full report here: https://www.aurovilleconsulting.com/electricity-subsidy-and-a-just-energy-transition-in-tamil-nadu/
Status of Distributed Solar Energy in Tamil Nadu – Challenges & Roadmap 2025AurovilleConsulting
As of the end of 2020, Tamil Nadu has an installed solar PV capacity of over 4 GW. However, distributed solar PV makes a disproportionately small contribution in this: less than 20%. This report outlines the current state of distributed solar energy in the State. It identifies and elaborates on the challenges for distributed solar energy in relation to: i) policy and regulations, ii) operational challenges, iii) solar PV financing, iv) skill development, and v) grid integration of solar energy. We explore a roadmap to 2025 consisting of a set of measures – foundational and advanced – for the utility and policy makers to accelerate the transition to a distributed solar energy future.
These slides present at an introduction level about the demand side management and demand response in smart micro-grid system. Later mathematical modelling and detail on optimization techniques will be covered.
This presentation gives a brief about the Indian Power sector. It covers evolution, growth, major players of Power sectors. Also, it focuses various acts, regulations and tariffs related to it. The important part is issues which are there in Power sector and we have made an attempt to provide recommendations for the same.
Renewable Energy Sources are being used in Off-Grid mode. By integrating all these sources to a common point energy efficiency can be improved and frequent dynamic faults can be avoided. This approach needs to implement smart grid and technologies.
The world has already used her non-renewable resources. It will take 100 of years to recharge. But as Bangladesh is a land of beauty, she has a lot of renewable resources. If all of them can be utilized properly, our dependency on non-renewable resources will be vanished.
MODELLING AND PERFORMANCE ANALYSIS OF BIFACIAL SOLAR PVvikaspanch
SOLAR PHOTOVOLTAIC TECHNOLOGY
It is an new emergent technology in solar panels which unlike conventional P.V. panels collects sunlight from not only front side but rear side also.
This is done by capturing light reflected from the surface beneath the module and from the environment.
Thus using both direct and diffused light.
APPLICATIONS:
BUILDINGS
PARKING
HIGHWAYS LININGS
ROOFTOPS
SNOW COVERED AREAS
MERITS:
Increase in generation
Reduction in installation area
Reduction in overall cost
Wide range of application
Pay back period and cost base analysis of solar PV LanternMalik Sameeullah
Financial analysis tool is used to find out the financial feasibility of solar Photo voltaic Lantern. Topic used simple financial tool with self explanatory formula and explain financial analysis of SPV lantern. It is easy to understand the financial analysis specially for beginner.
Solar Parks are becoming increasingly popular & MNRE is leaving no stone unturned to make them a success.
The ppt mentions the nuts & bolts of the Solar Park Scheme of MNRE.
Renewable energy integration and energy storage Bushveld Energy
Presentation by Bushveld Energy at the Power Transmission Africa conference on the topic of renewable energy integration and storage. The presentation covers the role that battery storage can play to reduce the costs and challenges for transmission and distribution networks in incorporation large amounts of renewable energy. The presentation sites a few examples and focuses on Africa, in particular.
ELECTRICITY SUBSIDY AND A JUST ENERGY TRANSITION IN TAMIL NADUAurovilleConsulting
To address climate change, to promote adaptation and resilience, to eliminate energy poverty, and to ensure a just energy transition, countries and states will have to mobilise substantial financial resources. A recent study estimated that India will need to invest a 900 billion USD over the next 30 years to ensure a ‘just energy transition’ (Bushan 2023). While developed countries have pledged to provide climate finance to developing countries, these pledges have not been fulfilled, or are very slow to arrive, or are insufficient. Developing countries will need to find additional and alternative resources to accelerate the decarbonization of its economies and to invest into climate adaptation. The United Nations (2022) has outlined a few interventions that can help in accelerating a just energy transition. These include:
to make renewable energy technologies a public good,
to shift energy subsidies from fossil fuels to renewable energy, and
to triple investments into renewables.
In 2009, G20 members committed to phasing out and rationalizing fossil fuel subsidies in the medium term (Reuters 2009). But as of 2022, fossil fuel subsidies have not been phased out, neither have they been reduced; instead, fossil fuel subsidies exceeded USD 1 trillion globally for the first time. This is largely due to governments’ increased subsidies to cushion consumers from rising energy prices (IISD 2023).
Energy subsidies are found in virtually every country. Justifications for their use range from social welfare protection, job creation, encouragement of renewable energy sources, promotion of economic development, to energy security. However, it may be worth examining some of the current energy subsidy schemes asking if and to what extent these subsidy schemes are contributing to a just energy transition and to what extent these subsidies align with the proposed three interventions by the UN.
Read the full report here: https://www.aurovilleconsulting.com/electricity-subsidy-and-a-just-energy-transition-in-tamil-nadu/
Status of Distributed Solar Energy in Tamil Nadu – Challenges & Roadmap 2025AurovilleConsulting
As of the end of 2020, Tamil Nadu has an installed solar PV capacity of over 4 GW. However, distributed solar PV makes a disproportionately small contribution in this: less than 20%. This report outlines the current state of distributed solar energy in the State. It identifies and elaborates on the challenges for distributed solar energy in relation to: i) policy and regulations, ii) operational challenges, iii) solar PV financing, iv) skill development, and v) grid integration of solar energy. We explore a roadmap to 2025 consisting of a set of measures – foundational and advanced – for the utility and policy makers to accelerate the transition to a distributed solar energy future.
BATTERY ENERGY STORAGE SYSTEMS AS AN ALTERNATIVE TO DIESEL GENERATORS – A COM...AurovilleConsulting
Power demand across the country is growing, and meeting peak demand is becoming more challenging. In Tamil Nadu, frequent power outages are observed, especially during summer months. To reduce economic impacts of unreliable power supply, commercial and industrial (C&I) entities, undertake investments in power backup systems. The most commonly used systems are diesel generator sets (DG sets) and battery energy storage systems (BESS), also known as an uninterrupted power supply (UPS).
DG sets have been a convenient power backup option due to an established market, their reliability, affordability, and modularity. But they have a high environmental footprint, cause noise pollution and negatively impact human health. On the other hand, BESSs could operate on zero emissions, if charged from renewable energy sources, and with minimal noise pollution. And with no exhaust emissions, they are particularly helpful in urban areas.
The cost of batteries, especially those of lithium-ion (Li-ion) battery packs, have been observing a dramatic drop – of 89% over the years 2010-2020. And, apart from performing their primary function as a power backup, BESSs can also provide grid services such as load shifting, load following, peak load management, voltage, and frequency support and facilitate higher levels of renewable energy integration. Thus, BESSs contest DG sets economically and technically as an alternative type of back-up system.
This report compares the economic and environmental performance of a Li-ion-based BESS with a conventional DG set, as power backup solutions. The analysis indicated that the levelized cost of battery storage (LCOS) is dictated by the battery pack costs in the market, while the levelized cost of energy (LCOE) of the DG is sensitive to diesel prices. The cost analysis was carried over a range of hours of back-up required, and the results favour the Li-ion BESS as a back-up option, in terms of economic and environmental performance, especially when charged at solar tariff solar tariff.
We hope that this report will assist C&I entities in Tamil Nadu to make the most economic and environmentally sound investment in their power backup systems.
Solar in India have its own importance. It's the best opportunity for investors and this presentation explores it. If you need any further info please feel free to contact me. Viraj
The article talks about energy transition from polluting fossil-based sources to green form of energy primarily based on hydro, wind, solar, etc. for sustainable development with net zero carbon emissions.
It is on gradual transition of sources of energy for the generation of electricity from hitherto mainly fossil-based fuels to renewable ones for sustainability as well as to net zero carbon emission.
PATHWAYS TO DECARBONISATION – MODELLING TAMIL NADU’S POWER SECTOR DECARBONISA...AurovilleConsulting
Tamil Nadu’s electricity demand is expected to increase year on year, and so are the sector’s absolute carbon dioxide emissions. Considering India’s commitments under the United Nations Framework Climate Change Convention, and the recent announcement of targeting net zero carbon by 2070, Tamil Nadu will require a long-term strategy to reduce its emissions. This may start with establishing sector-specific emission inventories, followed by sector-specific emission target setting.
The power sector is deemed to be one of the sectors easiest to decarbonise. One of the first steps for putting in place a decarbonisation strategy is target setting. This report assumes a net-zero carbon target for the Tamil Nadu power sector by 2050. It applies the Sectoral Decarbonisation Approach (SDA) of the Science Based Target (SBT) model to simulate decarbonisation pathways that are in line with the goals of the Paris agreement – limiting global warming well below 2°C above pre-industrial levels (ETP B2DS) and pursuing efforts to limit warming to 1.5°C (SBT 1.5°C) respectively.
In this paper, we undertake the following steps:
1) Projecting the electricity generation for the upcoming years along with the corresponding emissions.
2) Setting targets for the emissions based on the Science Based Targets (SBT).
3) Comparing various scenario planning models for decarbonising the electricity sector of Tamil Nadu.
BRIEFING NOTE: COMMUNITY SOLAR FOR DOMESTIC CONSUMERS AS ALTERNATIVE TO ELECT...AurovilleConsulting
Electricity tariffs for domestic consumers and several other consumer categories such as agriculture, huts, etc., are subsidized by the Government of Tamil Nadu. In addition to the electricity subsidy provided by the Government, TANGEDCO cross-subsidises the lower consumer tariffs from revenue collected from higher tariff paying customers. However, TANGEDCO is not able to recover its cost of supply. In 2015-16 TANGEDCO’s cumulative revenue gap was INR 30,884 Crore (TNERC 2017a). The trued-up revenue gap for the subsequent years is not available in the public domain, but the revenue gap is expected to have increased as no tariff revisions took place after the year 2017.
The Ministry of Power has repeatedly requested State Governments to phase out cross-subsidies and introduce a direct benefit transfer scheme in lieu of the current electricity subsidy scheme.
This briefing note presents alternatives to the current energy subsidy and cross-subsidy schemes along with the implementation of a tariff rationalization for the domestic consumer category and assess the impact on consumers, TANGEDCO, and the Tamil Nadu State Government.
Assessing the Impact of Tamil Nadu’s Electricity Tariff Policy on TANGEDCO’S ...AurovilleConsulting
Electricity consumption is one of the most telling indicators to assess a nation’s economic development. A financially robust and vibrant electricity sector is pivotal for economic growth and is considered vital for a nation’s overall development. Tamil Nadu is one of the states with free electricity for agriculture and electricity tariffs for several other consumer categories such as domestic, huts, etc., are subsidised by the Government of Tamil Nadu. In addition to the electricity subsidy provided by the Government, the state owned electricity utility, TANGEDCO, cross-subsidises the lower consumer tariffs from higher tariffs revenue. However even with the combination of Government of Tamil Nadu subsidies and cross-subsidies, revenue is significantly lower than costs. In 2015-16 TANGEDCO’s cumulative revenue gap was INR 30,884.15 Crore. This paper presents an analysis of the impact of Tamil Nadu’s electricity policies on the financial performance of TANGEDCO.
2021 SOLAR PLUS ENERGY STORAGE: FEASIBILITY OF BEHIND-THE-METER SYSTEMS FOR H...AurovilleConsulting
Unreliable grid supply drives consumers towards deploying power back-up solutions such as uninterrupted power systems and diesel generators. Solar plus energy storage becomes an increasingly attractive alternative as it can provide a degree of energy security and independence to the consumer. It is cheaper, quieter, takes up less space, avoids emissions and has a shorter response time compared to diesel generators.
In 2019-20 India imported batteries worth USD 1.2 billion making this sector heavily dependent on foreign manufacturing capacities. To reduce the dependence on imports and develop the local market, Niti Aayog, a Government of India think tank proposed setting up Giga capacity battery factories aggregating a capacity of 50 GWh over the next ten years at a projected cost of USD 5 billion. The Indian Government has proposed to offer subsidies to the tune of INR 700 Crore a year and also provide incentives such as the benefit of entire depreciation in one go and zero import duty on lithium, iron and cobalt to battery manufacturing industries.
Consumers, in India particularly, are highly cost sensitive. The recent decrease in the cost of both solar PV and Li-ion battery storage and an increasing commitment by a larger share of the population to shift towards sustainable solutions is expected to result in an increased uptake of BtM solar and energy storage systems.
This report compares the cost of supply from the grid, partial supply from solar and partial supply from solar plus energy storage (lithium-ion) on the consumer side of the service connection (behind-the-meter) for selected HT consumer types in Tamil Nadu.
Auroville has been active in renewable energy generation since the early years, starting with windmills for water pumping and stand-alone solar PV systems with battery banks. In 2012 Auroville pioneered rooftop grid-connected solar energy by proposing to the Tamil Nadu Government that pilot projects may be undertaken in Auroville with grid-connectivity.
Large scale grid amalgamation of renewable energy sources in indian power systemIjrdt Journal
Renewable energy sources integrated to utility grid always depends on the rate of power generation. Large scale power generations are connected to transmission systems where as small scale distributed power generation is connected to distribution systems. There are certain challenges and issues in the integration of both types of systems directly.
The plans for the development of electricity from renewable energy sources cause three major challenges. Firstly, renewable change the geographical distribution of generation centres compared to the load centres. Secondly, a share of the renewable will be connected to distribution grids and will thus change the vertical distribution of generation. Thirdly, wind and solar energy are two dominant technologies which depend directly on the natural supply of renewable energy and thus are variable and intermittent energy sources. This report addresses the most relevant measures which can be taken in order to deal with these challenges. This paper presents a review in the issues, challenges, causes, impacts and utilization of renewable energy sources Grid Integration.
India's pursuit of climate targets, including net-zero emissions by 2070, hinges on integrating renewable energy. The power sector's heavy reliance on fossil fuels necessitates a significant shift towards renewables. With a rising demand for electricity, effective demand-side management strategies are vital to ensure grid stability. Time-of-use (ToU) tariffs, recognized globally, play a crucial role in this strategy, offering a more accurate reflection of electricity costs compared to flat rates.
This report focuses on evaluating the impact of various ToU tariff designs on grid management parameters for Tamil Nadu in 2024. The objective is to assess how static ToU tariffs prompt consumers to shift or reduce electricity usage, facilitating greater renewable energy integration. The study considers 27 ToU tariff designs, assuming 17% wind energy and 11% solar energy. Notably, findings are specific to Tamil Nadu's energy demand pattern, peaking in early afternoon hours in April.
Results emphasize the importance of defining peak and off-peak time slots optimally to reduce peak loads and curtailment of renewables. Shifting peak hours from 6:00h-10:00h and 18:00h-22:00h to 5:00h-7:00h and 17:00h-23:00h improves key parameters, including a reduction in peak load instances on the gross and net load. Introducing a tariff rebate during solar energy generation hours (solar sponge) from 10:00h to 16:00h effectively reduces peak load magnitudes and encourages load distribution throughout the day, enhancing grid stability. Adjusting peak hour tariffs and shifting peak hours has a noticeable impact on load distribution and peak load occurrences.
The study indicates that a 25% increase in peak-hour tariffs outperforms a more aggressive 40% increase, which may create new peak load instances. Simulated off-peak rebates of 5% and 10% during late night and early morning hours have negligible effects.
Overall, these findings underscore the potential benefits of implementing ToU tariffs for all consumer categories, including reduced peak loads, load range occurrences, and ramping requirements. Careful consideration of peak hour tariffs and adjustments to peak hours can further optimise load distribution and maximise the efficiency of the power grid. To meet its RPO and its climate change objectives Tamil Nadu will have to accelerate the deployment of renewable energy generation. In order to manage the variable nature of wind and solar energy generation and of demand the grid management will require a higher degree of demand and generation flexibility services.
Auroville Consulting (AVC) published its annual sustainability report for the financial year 2022-23.
This year we intensified this practice along with the digital footprint through network usage and website hosting, understanding the impact of our recently installed HVAC system, and emissions avoided through providing e-bikes to all our team members. We have achieved a net zero emission balance for FY 2022-23. This was made possible through planned interventions and implementation of good practices to reduce gross emissions, followed by investment in long term effective carbon positive projects. Some key highlights:
● 92% of this year’s gross emissions were offset by planting trees and the remaining 8% was offset by excess solar generation, making AVC a carbon net-zero organisation.
● 100% of electricity demand was supplied by renewable energy through rooftop solar.
● 25.58 kWh of electricity was consumed per square meter of office space, which is 75% lower than the benchmark of Bureau of Energy Efficiency (BEE) for an office building in a warm and humid climate (Benchmark: 101 kWh/sq. m/yr).
● From March 2022 onwards, the organisation has been providing electric two-wheelers to all its full-time team members for their daily commute to and from office and for their own personal use, along with a charging facility supplied by an additional installed capacity of rooftop solar. This initiative resulted in :
o An emission reduction of 2,584 kg CO2e for their daily commute to and from office, which is an 88% decrease in comparison to the previous year, and
o An emission reduction of 6,309 kgCO2e, which was achieved by converting the personal commute of our team members to e-vehicles and charging them through renewable energy. This is a value higher than the total gross emissions of the organisation..
● 98% of the operational expenditure was made in local areas, with 91% inside Auroville; and the remaining 2% in Pondicherry and Tamil Nadu – preventing unnecessary emissions and stimulating the local economy.
Rajapalayam is the taluk headquarters of Rajapalayam Taluk, and an important town in the district of Virudhunagar within the State of Tamil Nadu. Rajapalayam LPA, which includes Rajapalayam town, 15 surrounding revenue villages and 2 reserved forests, has a total population of 2.16 lakh, as per the 2011 Census. In 2023, a master plan was formulated for Rajapalayam LPA, the master plan has a planning period till 2041. The master plan was meant to foster sustainable urban development, responsible land-use and resource efficiency and is expected to propel the town on a pathway towards decarbonization and inclusive growth. Rajapalayam is the first town in Tamil Nadu that has aspired to announce a GHG emission reduction target, it aims at achieving net zero emissions by the year 2041.
It is in this context that an emissions inventory for the town has been developed. The purpose of this GHG emissions inventory is to report on the sources and magnitude of GHG emissions. While this inventory provides us a broad understanding of today’s emissions, consecutive reports on a yearly or bi-yearly basis can help improve the quality of the data and understand the progress of the activities undertaken by the LPA to reduce their impact on the surrounding environment.
LAND SUITABILITY ASSESSMENT FOR STORMWATER MANAGEMENT, MAYILADUTHURAI DISTRIC...AurovilleConsulting
Land is a finite resource with competing and conflicting use. Unplanned and unscientific use of land can exacerbate climate change, and disasters like drought or floods. Judicious use of land resources is key in meeting the state’s social, economic, and environmental development goals. A comprehensive land suitability assessment can guide responsible and sustainable development practices and land-use policies.
Land and water are closely interlinked, as the availability and flow of freshwater depends on the land characteristics, such as its topography and composition, amongst other factors. Therefore, certain areas of lands naturally act as better sinks for capturing stormwater or surface run-off water from precipitation. Freshwater, on the other hand, is a critical resource, and the stress on freshwater resources is expected to increase with growing population, development, and climate change. According to India’s Composite Water Management Index (Niti Aayog, 2018), 600 million people in the country are suffering from an acute shortage of water. Read more in the report: https://www.aurovilleconsulting.com/land-suitability-assessment-for-stormwater-management-mayiladuthurai-district-tamil-nadu/
MAXIMISING THE BENEFITS OF DISTRIBUTED SOLAR ENERGY: AN EVALUATIONAurovilleConsulting
Tamil Nadu is making significant strides towards a sustainable energy future, supported by announcements of adding 20 GW of solar energy capacity and 10 GW of battery energy storage capacity by 2030. The state’s policy and regulatory frameworks, including the Tamil Nadu Solar Policy and the Generic Tariff Order, are driving the adoption of grid-connected distributed solar energy. As the adoption of distributed generation systems increases, the importance of smart grid integration becomes evident. Studies that provide an avoided cost assessment offer an opportunity to network operators to identify the most appropriate distribution network nodes and distributed renewable energy (DRE) capacities
This report focuses on evaluating the network and societal impacts of introducing distributed solar energy in the Karungalpalayam HT Feeder under the Erode substation. This analysis provides valuable insights into the distribution of active power and voltage, allowing operators to optimize network performance. The report utilized the Solva tool. Solva is a web-based tool with the aim to assist grid operators in assessing the network and societal value of distributed energy resources (VODER). Solva assesses both network benefits and societal benefits. Network benefits encompass the avoided costs associated with energy, distribution capacity, transmission capacity, and generation capacity. Simultaneously, societal benefits factor in the avoided costs of CO2 emissions, SO2 emissions, NO2 emissions, and PM2.5 emissions.
For the selected feeder a 4.50 MW solar energy system interconnected at the tail end of the feeder results in a VODER benefit of INR 12.84 per kWh. These benefit is subdivided into network benefitss and societal benefit. The societal benefits achieved from the integration contribute to 8.84 INR/kWh or 69% of the total benefit. Network benefits are found to be at 4.00 INR/kWh or 31%. With the integration of distributed solar energy, the distribution line losses show a reduction, particularly if interconnected at the middle end or tail end of the HT feeder. When the solar energy system is interconnected at the tail end or at the middle end of Karungalpalayam HT Feeder, a deferral of feeder upgradation is found.In particular to Karungalpalayam HT feeder, interconnecting the distributed solar energy system close to the point of consumption offers the highest benefits.
In 2022 a GHG emission baseline for Auroville was established. The inventory highlighted the overall emissions from the community. This report now intends to assess the sequestration capabilities of Auroville land under tree cover for a five-year period from February 2017 to February 2022. The tree cover in Auroville is a prime contributor to the community’s long-term vision of sustainable development. The overall tree cover includes the residential zones, industrial zones, parks, public spaces and the designated green belt area of Auroville developed and maintained by the Forest Group of Auroville.
The cumulative carbon stock for Auroville’s land under tree cover of 920 hectares for the time period from February 2017 to February 2022 was estimated at 34,778 tCO2e. This equals an average carbon stock addition of 6,956 tCO2e per year. The average carbon stock per hectare of forest land in Tamil Nadu was estimated at 87.26 tCO2e/year. The average carbon stock per hectare over five years for the Auroville forest was found to be 99.96 tCO2e/year which is 14.55% above the average.
As per the Auroville Greenhouse Gas Accounting Report, Auroville produced 8,298.54 tCO2e in FY 2018- 2019, this excludes emissions from agriculture, forestry and other land use (AFLOU) and industrial production and product use (IPPU). Auroville’s green cover sequestered 84% of its total emission or 6,956 tCO2e per year. The surplus CO2e emitted for FY 2018-19 therefore is 1,343 tCO2e or 16%. To offset this carbon an additional 19.82 hectare of land would need to be converted from moderately dense forest to very dense forest. This could also be achieved by installing a 1.19 MW solar energy capacity or by transitioning all units to low or zero emission transport solutions.
Consistent studies either on a yearly or bi-yearly basis can help improve accuracy of emissions tracking and sequestration numbers of the community and help set targets. This would lead to additional financing opportunities and access to voluntary mechanisms such as carbon financing to support existing forestry activities.
During the last COP events (COP 26 and COP 27) India stepped up its climate ambitions and announced a goal of reaching net-zero by the year 2070. More specifically its Nationally Determined Contributions (NDCs) includes to achieve about 50 percent cumulative electric power installed capacity from non-fossil fuel-based energy resources by 2030.
In December 2022 Tamil Nadu launched its own Climate Change Mission. Its goals include the development of strategies to cut emissions by using green and renewable energy. This complements an earlier announcement by the State Government, that it aims to add an additional 20 GW of solar energy by the year 2030.
More recently, in March 2023, the Tamil Nadu Governments announced that it will target that 50% of all energy will be sourced from renewable energy sources. If the state where to meet this target it would firmly establish itself as a climate leader on the national and international stage. Further, Tamil Nadu aspires to be a leading export state and as there is increasing international supply chain pressures for industries to reduce their carbon emissions accelerating the transition towards a renewable energy can help its industries to stay competitive in a decarbonizing world. An accelerated energy transition will also promote Tamil Nadu as an attractive location for industries.
In FY 2021-22 the total energy generated was 1,17,553 million units (MU). Renewable energy, this is solar, wind, bioenergy, and hydro, accounted for a 22% of the total energy generation in FY 2021-22. Coal power with a share of 70% is the single largest energy sources. This total energy generation can be subdivided into two parts, (i) energy procured by TANGEDCO and (ii) energy under Open Access. TANGEDCO accounted for 83% or 97,297 MU of energy in FY 2021-22. Whereas the remaining 17% of 20,266 MU are on account of Open Access.
Interestingly TANGEDO procured only 16% of its energy from renewables. Whereas 52% of all energy under Open Access is RE. 51% of all energy procured by TANGEDCO came from either TANGEDCO owned or Centra owned coal power plants. The actual share of coal power may be higher as there is 24% of energy that was sourced under the category ‘Short term and others’ and this may primarily be coal power.
To meet the 2030 RE target an additional 60,637 MU of RE will need to be generated in 2030. This represents approximately an addition of 28 GW of wind energy capacity or a 32 GW of solar energy capacity and means that in the next six years starting with FY 2023-24 approximately 4.80– 5.50 GW of renewable energy capacity needs to go on-grid. The average annual RE capacity addition in Tamil Nadu from 2018 to 2023 was 1.21 GW.
Meeting the 50% RE target will require a concerted effort by all major power sector institutions and players including the distribution licensee, the Electricity Regulatory Commission, the Energy Department, Independent Power producers and the consumers/prosumers.
In the face of the global climate crisis there is an increasing commitment to decarbonise the global economy. This is highlighted by a shift towards renewable energy sources, the energy transition. Energy transition is the process of reducing reliance on fossil fuel across the economy and moving toward greater use of cleaner energy sources such as renewables.
Globally, countries, including those in the European Union, are introducing legislative measures to accelerate the decarbonisation of its economies. In January 2021, the European Union (EU) introduced a Carbon Border Adjustment Mechanism (CBAM). CBAM is part of the EU’s efforts to reduce greenhouse gas emissions and achieve climate neutrality by 2050. It will put restrictions at the borders on goods produced with carbon and Greenhouse gas emissions (GHG)
While the carbon price will be levied from 2026 onwards, the reporting of emissions on imported goods has stated in January 2023. CBAM is initially focusing on some key sectors only, but is expected to expand over time. Sectors for which CBAM applies include:
Iron and steel, Cement, Chemicals, Aluminium, Paper, Glass, Fertilizers, Pulp and paper, Textiles,Ceramics,Basic metals
Other countries or regions that consider introducing similar mechanisms include: Canada, United Kingdom, United States, Japan and South Korea.
The EU is a key export market for India, it is India’s third largest trading partner. India’s exports to the EU were worth EUR 46.20 billion in 2021. Compliance of Indian companies with the EU CBAM will require monitoring, calculating and disclosure of the GHG emissions embedded in the products covered under CBAM.
Tamil Nadu has the second largest state economy in India. The Tamil Nadu Government has set a goal of becoming a USD 1 trillion economy by 2030. The state has a diversified manufacturing sector and features among the leaders in several industries like automobiles and auto components, engineering, pharmaceuticals, garments, textiles, leather, chemicals, plastics, etc.
The role of Micro, Small and Medium enterprises (MSMEs) in the economic and social development of the country is well established. Tamil Nadu has the third-largest number of MSMEs in the country with a share of 8% or about five million enterprises (MSME Department 2022). MSMEs form an important and growing segment of the state’s industrial sector, contributing 12.09% to the GSDP. However, the growth of the state’s MSME sector has been severely impacted by Covid and has been stagnant.
As Tamil Nadu aspires to be a leading export state in India at a time when more countries are proposing Carbon Border Adjustment Mechanism (CBAM) decarbonisation will become an imperative for export-oriented industries to stay completive. For the exported goods from Tamil Nadu to be compliant with regulations it is important to decarbonise the production. The decarbonization will also be paramount for the MSME sector.
LAND SUITABILITY ASSESSMENT FOR DISTRIBUTED SOLAR ENERGY, VILLUPURAM DISTRICTAurovilleConsulting
Land is a finite resource with competing and conflicting use. Unplanned and unscientific use of land can exacerbate climate change, and disasters like drought or floods. Judicious use of land resources is key in meeting the state’s social, economic, and environmental development goals. A comprehensive land suitability assessment can guide responsible and sustainable development practices and land-use policies.
As per its intended Nationally Determined Contribution under the United Nations Framework Convention on Climate Change, India is targeting 50% of its cumulative power generation capacity from non-fossil fuel-based energy resources by 2030. Tamil Nadu has announced that it aims at adding an additional 20 GW of solar energy capacity by the year 2030. This capacity addition is envisioned to be primarily achieved by distributed solar energy generation.
One of the key challenges in developing solar energy project is the identification of suitable lands and land acquisition. The complex land acquisition process can lead to project delays or even cancelation of proposed projects. Unused or fallow lands can be of particular interest for solar energy development. This method avoids the uptake of land under productive agricultural use. Local authorities can proactively facilitate solar energy development in the district by identifying unused lands and by undertaking a solar suitability assessment of these lands. This geospatial information if provided to solar developers and electricity distribution companies has the potential to spur local economic development and to create green jobs.
The objective of this report is to identify unused lands in Villupuram district and to evaluate to what extent these unused lands can be utilized to meet the state’s solar energy capacity addition target of 20 GW by the year 2030. Deploying 20 GW of ground mounted solar energy will require approximately 80,000 acres of land, this represents 0.25% of Tamil Nadu’s total geographical area (TGA).
Villupuram, district has a total geographical area of 3,907 km2 of which 1,092 km2 or 28% has been classified as unused or fallow lands. The district’s solar energy target has been set as a proportional share of the state’s solar energy capacity addition target of 20 GW by 2030. The district’s target is to add 0.62 GW of solar energy by 2030. This requires a land area of 2,465 acres. The land suitability analysis revealed that 92,149 acres of unused land have a technical potential for ground mounted solar energy development. These lands are distributed over 3,084 plots. The suitable lands identified can accommodate up to 23.04 GW of solar capacity, this would help achieving a whooping 3,738% of (or 37 times) the district’s solar capacity addition target.
THE SOLAR ENERGY-LAND NEXUS SUSTAINABLE LAND USE STRATEGY FOR SOLAR ENERGY IN...AurovilleConsulting
Energy generation can have intensive or extensive land use requirements, causing habitat and biodiversity loss in sensitive and diverse ecosystems globally or competing with other land use such as agriculture.
As a direct consequence of the Paris Climate Agreement, which requires global decarbonization, renewable energy sources will continue to expand, in particular solar and wind. The increasing land use for renewable energy generation systems and related infrastructure will become more relevant in the future. The extent to which the overall land use balance will be more favourable than for non-renewable sources depends on the mix of renewables, their siting and centralized or decentralized mode of deployment (UNEP, 2016). Innovative deployment of renewables can reduce land use pressures, as well as avoid landscape disturbances caused by fossil fuels and nuclear energy (Lovins, 2011).
While the use of fossil fuels is limited by the size of the resource (including future cost and the carbon dioxide (CO2 ) budget), renewable energy and in particular solar energy, is mostly restricted by land use allocation and by the availability or solar irradiation or adequate windspeeds.
Land or sea occupancy is one of the most visible impacts for any energy development. The relatively large land requirement for solar energy highlights the importance of good mitigation practices to help facilitate the transition into a renewable energy future. Fortunately, the abundance of solar energy means that, unlike other energy sources, there is often flexibility in project siting, allowing the integration of solar energy systems with buildings and infrastructure assets or the co-location of solar energy systems with agricultural practices or the use of wastelands.
Tamil Nadu has set a target of adding a 20 GW of solar energy by 2030. If this target is to be primarily met by ground-mounted solar plants a 405 km2 land area will be required. Considering the projected annual electrical energy demand of 4,89,395 MU by 2050 (Auroville Consulting 2022) the need to decarbonize the state’s power sector and the fact that solar is among the most cost -efficient energy sources today, the potential land-impact of solar is substantial. Meeting 50% of the projected electricity demand for 2050 would require 133 GW of solar capacity, and 2,691 km2 of land resources, which equals the total geographical area of Chengalpattu District or 2.07% of the state’s geographical area.
There are competing and often conflicting demands for land for economic, ecological, and social needs in the development sector. It will be critical to limit the conversion of agricultural lands for solar energy development.
https://www.aurovilleconsulting.com/
LAND SUITABILITY ASSESSMENT FOR FORESTATION, MAYILADUTHURAI DISTRICT, TAMIL NADUAurovilleConsulting
Land is a finite resource with competing and conflicting use. Unplanned and unscientific use of land can exacerbate climate change, and disasters like drought or floods. Judicious use of land resources is key in meeting the state’s social, economic and environmental development goals. A comprehensive land suitability assessment can guide responsible and sustainable development practices and land-use policies.
As per its intended Nationally Determined Contribution under the United Nations Framework Convention on Climate Change, India is targeting the creation of an additional carbon sink of 2.5 to 4 billion tonnes of CO2 by 2030 – through additional forest and tree cover of 25-30 million hectares. In this context, the State Government of Tamil Nadu has set a target to increase its percentage of tree cover from 23% to 33% by the year 2030.
A forestation land suitability assessment for the Mayiladuthurai district in Tamil Nadu, India was carried out using a geospatial digital tool LiLa (LifeLands). LiLa uses satellite imagery, AI & GIS mapping to create critical data-based insights and visualization that supports decision-making by providing detailed information. This includes geo-spatial and socio-economic data-layers to address the core aspects of sustainable land-use management. It identifies and evaluates unused lands for its potential in terms of solar energy, forestation and water management.
The objective of this report is to identify unused lands in Mayiladuthurai district and evaluate its potential for forestation initiatives that can contribute meeting the state’s tree-cover target of 33% by the year 2030.
Identified unused lands were evaluated based on multiple-criteria methodology including parameters pertaining to terrain suitability, existing road, rail and electrical transmission and distribution infrastructure, elevation, water potential and potential to create forest corridors. The lands are also further assessed based on their potential for competing climate action, such as areas that are suitable for water harvesting and solar energy generation.
The land use mapping indicates that 8% of the district’s geographical area is under tree cover. Agriculture land use is by far the most dominating land use category accounting for 63%. Identified unused lands account for an area of 118 km2 or 10% of the total geographical area. Out of the total identified unused lands 56% or 16,237 acres have been found to be suitable for forestation. If all the unused lands suitable for forestation were put under tree cover Mayiladuthurai district would increase its share of lands under tree cover from 8% to 13.5% creating a carbon stock of 0.55 million tonnes of carbon.
LAND SUITABILITY ASSESSMENT FOR DISTRIBUTED SOLAR ENERGY MAYILADUTHURAI DISTR...AurovilleConsulting
A land assessment for the Mayiladuthurai district in Tamil Nadu, India was carried out using a geospatial digital tool LiLa (LifeLands) developed in-house. LiLa uses satellite imagery, AI & GIS Mapping to create critical data-based insights and visualization that supports decision-making by providing detailed information. This includes geo-spatial and socio-economic data-layers to address the core aspects of sustainable land-use management. It identifies and evaluates unused lands for its potential in terms of solar energy, reforestation and water management.
The objective of this report is to identify unused lands for this district and evaluate to what extent these unused lands can be utilized to meet the state’s solar energy target of 20 GW by the year 2030. The lands were evaluated based on multiple levels of criteria that accounted for plot size, and their distance from evacuation infrastructure, roads, railways and waterbodies. The lands are also further assessed based on their potential for climate action, such as areas that are suitable for forestation and water harvesting.
The assessment indicated that a target of 0.29 GW of solar installation is achievable with lands that meet the technical criteria. Lands ranked medium can achieve a cumulative capacity of 0.46 GW with a total area of 1,860 acres. Lands ranked high with a total area 698 acres can achieve a capacity of 0.17 GW.
The prevalence of offshore wind is growing globally. According to the Global Wind Energy Council, the total installed capacity worldwide climbed to 57.2 GW at the end of 2021. Offshore wind technology has key advantages such as eliminating the need for large areas of land and harnessing energy from better wind conditions than onshore. Currently, India does not have any installed capacity. However, there has been a recent build-up in momentum. Tamil Nadu has been identified as one of the highest potential states for harnessing offshore wind energy in India. But the State faces technical, social, and financial barriers for phasing-in this new technology. In this regard, the Tamil Nadu Government can play a key role in unlocking this significant source of energy by (i) providing the overall infrastructure required, (ii) engaging with local stakeholders, and (iii) facilitating the clearance process for offshore wind projects, among others.
BRIEFING NOTE: ELECTRIFICATION OF TOP-PERFORMING INDUSTRIES IN TAMIL NADUAurovilleConsulting
Tamil Nadu is one of the most industrialised states in India and accounted for 9.47% of India’s GDP in FY 2020-21. Tamil Nadu aspires to be a leading export state in India at a time when more countries are proposing Carbon Border Adjustment Mechanism (CBAM). CBAM includes the introduction of a carbon price on certain products imported into the European Union (EU). This will put restrictions at the borders of the EU on goods produced with carbon and Greenhouse gas emissions (GHG). As per an assessment of the World Bank, many countries are considering setting a carbon price in the years to come. Tamil Nadu could be exporting its finished goods to a few of those countries in the future. For the exported goods from Tamil Nadu to be regulation-proof, it is important to decarbonise the production. The first step towards decarbonisation is the electrification of the processes in the industries. This briefing note explores the potential for the electrification of some of the processes in the top-performing (in terms of contribution to the State’s GDP) industrial sectors of Tamil Nadu.
The second phase of the Auroville Smart Mini Grid is also complete. Driven and conceived by Auroville Consulting it compromises 108 kW of distributed rooftop solar energy systems. The solar PV systems reduces Auroville’s electricity consumption from the TANGEDCO grid by an average of 1,57,680 kWh per year and reduces it’s dependency on TANGEDCO. This is another step forward towards self reliance and sustainability. The project includes an energy storage system with a capacity of 10 kWh, 20 smart energy meters with a remote reading facility and additions to the Auroville internal electricity distribution system. Further we were able to upgrade our internal HT and LT distribution infrastructure and started piloting an active demand response program for domestic air conditioners and for municipal water pumps. The project was lead by Auroville Consulting. Other Auroville units include Auroville Electrical Service, Sunlit Future & Aurinoco.
Inspired by the method of Environmental, Social, and Governance (ESG) reporting, this report attempts to consolidate data on the performance of Tamil Nadu Generation and Distribution Company (TANGEDCO). The aim of this work is to initiate and develop holistic benchmarks. These key performance indicators would help TANGEDCO to track its own performance. Apart from the KPIs, this report also highlights the importance of sharing data in a public domain for the civil society to access.
LEVELISED COST OF BTM STORAGE IN INDIA 2021 – A STATUS REPORTAurovilleConsulting
This status report aims to present a snapshot of the current cost of energy storage in India for behind-the-meter (BtM) applications, and project them over the next 10 years to analyse when energy storage will start seeing significant adoption. Based on a detailed cost model for solar PV and energy storage with 50+ parameters & data on battery energy storage systems (BESS) gathered from several vendors in India, we evaluate the levelized cost of solar plus energy storage and standalone energy storage.
Even though as of today, BtM energy storage is not feasible in a lot of cases, we find that this will change fast this decade. By 2025, it will be possible for non-residential consumers to integrate large amounts of battery storage to generate and consume their own energy, enabling a distributed energy future. Along with it, the utilities face an inevitable transition from their traditional roles to distribution system operators.
BRIEFING NOTE: RECOVERY OF TANGEDCO’S FIXED COSTS FOR GENERATION, DISTRIBUTIO...AurovilleConsulting
This briefing note analyses the recovery of fixed costs through demand/fixed charges, compares the average fixed costs incurred with the fixed charges levied for select consumer categories, and finally compares the increase in the monthly billing rate of select consumer categories upon an increase in the fixed charges.
In none of the years from FY 2011-12 up until FY 2018-19 was TANGEDCO able to recover its Aggregate Revenue Requirement (ARR). One of the reasons is the under-recovery of fixed costs through fixed/demand charges levied.
TANGEDCO was unable to recover its fixed costs through demand/fixed charges since FY 2011-2012 since the demand/fixed charges component in the tariff schedule does not represent the actual fixed costs incurred. Since the fixed costs are under-recovered, there is a shortfall in meeting the ARR.
A rationalisation of the demand/fixed charges levied across all consumer categories would ensure the complete recovery of all fixed costs incurred and equal distribution4 of these costs. This entails an increase in demand/fixed charges for all LT consumers. Whereas the demand charges for all HT consumers would be lowered. Such a rationalisation of the demand/fixed charges would result in completely recovering the net ARR.
The benefits of recovering fixed costs through demand/fixed charges include the following:
• Reducing the need for tariff cross-subsidies;
• Reduction in TANGEDCO’s revenue gap and higher recovery of the net ARR;
• Reduce the migration of HT consumers to other states with more attractive tariff schedules;
• De-risking of energy demand changes that result in lower energy off-take from sources with fixed capacity booking costs.
BRIEFING NOTE: IMPACT OF ROOFTOP SOLAR BY C&I CONSUMERS ON TANGEDCO’S FINANCESAurovilleConsulting
The Tamil Nadu Solar Energy Policy 2019 excludes HT consumers from availing the net feed-in metering mechanism. This discourages a large segment of industrial, commercial, and institutional consumers from installing consumer category solar PV plants.
The only option available for these HT consumers for generating solar energy on their premises is to operate the plant under paralleling, in which any excess generation has to be either curtailed or stored. One key driver for excluding HT consumers from the net feed-in mechanism was a perceived revenue loss in the case of HT consumers installing rooftop solar energy systems. Under the existing cross-subsidy scheme higher tariff paying consumers are cross-subsidizing lower tariff paying consumers.
The Tamil Nadu Solar Energy Policy sets a consumer category solar energy target of 3,600 MW by 2023. As of December 2020, 6.87% of this target has been achieved. If the target of 3,600 MW is achieved by 2023 the solar energy from consumer category solar energy will represent an approximate 4% of the total electricity consumption in Tamil Nadu only.
If the solar net feed-in mechanism with the current net feed-in tariff of 2.28 INR/kWh were made available for all C&I consumers including the HT consumer categories, then TANGEDCO will benefit from consumer category solar energy systems installed on the premises of C&I consumers by reducing its Average Cost of Supply and by increasing its net billing revenue.
Under the current schedule of tariffs, the adaptation of consumer category solar energy systems by C&I consumers presents an opportunity rather than a threat to TANGEDCO to reduce its cost of supply and improve its billing revenue.
2019 DISTRIBUTED RENEWABLE ENERGY GENERATION – A STATUS REPORT FOR TAMIL NADUAurovilleConsulting
The global imperative for transitioning to a sustainable energy future accompanied by increasing cost competitiveness of renewables and new technology innovations is leading us to a transformation of the electricity sector. Distributed Renewable Energy Generation (DREG) and energy storage are among the key drivers of this change.
This status report attempts to trace the progress of Distributed Renewable Energy Generation (DREG) in Tamil Nadu and to highlight key barriers and enablers for a distributed renewable energy future.
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1. Sustainable Energy Transformation Series
MAKING
SENSE
OF
KUSUMOpportunities & challenges in delivering water
and energy security for agriculture in Tamil Nadu
2. Sustainable Energy Transformation Series
September 2019
Making
Sense
of
KUSUM
Opportunities & challenges in delivering water
and energy security for agriculture in Tamil Nadu
3. ACKNOWLEDGMENT
This publication forms part of the Sustainable Energy
Transformation, Tamil Nadu (SET-TN) series of documents and
activities. SET aims to facilitate higher clean energy deployment
in the State by working with all stakeholders in order to find
sustainable and equitable solutions. SET is a collaborative
initiative by Auroville Consulting (AVC), Citizen consumer and
civic Action Group (CAG), the World Resources Institute India
(WRI).
Author
Martin Scherfler, Auroville Consulting
Reviewers
Deepak Krishnan, World Resources Institute India
Harsha Meenawat, World Resources Institute India
Toine van Megen, Auroville Consulting
K. Vishnu Mohan Rao, Citizen consumer and civic Action Group
Designer
Ribhu Roy, Auroville Consulting
Suggested Citation: Auroville Consulting. 2019. Making
Sense of KUSUM. Opportunities & Challenges in delivering
water and energy security for agriculture in Tamil Nadu.
4. Making Sense of KUSUM1
TABLE OF CONTENTS
1. BACKGROUND 2
2. KUSUM COMPONENT A 4
2.1 Proposed 4
2.2 Critique 5
2.3 Alternative 7
3. KUSUM COMPONENT C 9
3.1 Proposed 9
3.2 Critique 10
3.3 Alternative 11
4. SUMMARY AND CONCLUSION 13
5. Making Sense of KUSUM 2
The agricultural sector in Tamil Nadu accounts for about 20% of the state’s electricity
consumption. Electricity supply, in the state, is free of cost to the farmers. Though the
subsidy burden for the free electricity to agricultural consumers is partially shouldered
by the state Government 1
, the primarily subsidy burden rests with the state-owned
electricity utility, Tamil Nadu Generation and Distribution Corporation (TANGEDCO).
To compensate for the revenue loss for electricity supply to the agricultural sector, and
to other subsidy consumer categories such as the domestic consumers, TANGECO
levies higher tariffs on other electricity consumer categories such as the commercial
and industrial ones.
With the rapid cost decline of renewable energy over the last decade, an electricity
market reform (Electricity Act of 2003) and the advent of rooftop solar, procuring
electricity from the distribution companies (Discoms) increasingly becomes a
less attractive option for the commercial and industrial consumers (C&I), and the
high end residential consumers. There is a trend of C&I consumers migrating to
alternative options such as procuring electricity via the open access mechanism or
by transitioning, to the extent possible, to captive (rooftop) solar energy. With the
threat of an increasing migration of high paying electricity consumers towards more
affordable alternatives, TANGEDCO is faced with the challenge of keeping up the
subsidized power supply to the agricultural and domestic sector, and this in the
face of dwindling revenue. To make things worse, electricity consumer prices have
not been revised on an annual basis. The last tariff revision, in Tamil Nadu, was in
the financial year 2017. Consumer tariffs determined in 2016-17 are still applicable
today, in 2019. As the cost of electricity supply has increased and no increase of
consumer tariffs took place, TANGEDO’s financial health is substantially affected.
1) TAGNEDCO receives a subsidy of INR 2,850 for each HP of sanctioned agricultural pump load. In the financial
year 2017-2018, this subsidy amount accounted for INR Core 3,432. With an estimated electricity consumption for the
agricultural sector of 12,544 MU (Approved sales figure from TANGEDCO as per Tariff order 2017) and an average
cost of supply in the same year. The total cost of electricity supply to agriculture amounts to 9,671.42 INR CRORES
(as per the ACOS Calculated from P&L Balance sheet for 2017-18 which is 7.71 INR/kWh). The subsidy by the state
Government makes up for 35.480% percent of this cost, the remaining cost is being shouldered by TANGEDCO.
1. BACKGROUND
WHY THIS PAPER?
6. Making Sense of KUSUM3
2) Ministry of New and Renewable Energy (MNRE). 2019. Guidelines for Implementations of Pradhan Mantri
Kisan Urja Surakha evam Uttham Mahabhiyan Scheme. F.No. 32/645/2017-SPV Division. Accessed under:
https://mnre.gov.in/sites/default/files/webform/notices/KUSUMguidelines.pdf
In July 2019, the Ministry of New and Renewable Energy (MNRE) released the
guidelines for its new flagship program ‘Pradhan Mantri Kisan Urja Suraksha evam
Utthan Mahabhiyan’ (KUSUM)2
. KUSUM is presented as a scheme that primarily
aims at benefiting farmers. The scheme has the following three components.
This report aims at delivering a cost-benefit analysis of KUSUM Component A and B and
possible alternatives, taking all major stakeholders - the DISCOM, the generator, the farmer
and the state Government – into consideration. Component B is not scope the analysis, as
this report focuses on the grid-connected component of Kusum. The analysis is being done
in the context of Tamil Nadu, but may be relevant for the majority of the other Indian states.
The proposed alternatives attempt to build upon the strength of the KUSUM approach by
introducing selected modifications in the scheme in order to better bring out its full potential.
Setting up of 10,000
MW of Decentralized
Ground / Stilt Mounted
Grid Connected Solar or
other Renewable Energy
based Power Plants
Installation of 17.50
Lakh Stand-alone
Solar Agriculture
Pumps
Solarisation of
10 Lakh Grid
Connected
Agriculture Pumps
Component A Component B Component C
7. KUSUM COMPONENT A
Setting up of 10,000 MW of Decentralized Ground/Stilt
Mounted Grid Connected Solar or other Renewable Energy
based Power Plants
8. Making Sense of KUSUM 6
Component A aims at the promotion of distributed
renewable energy generation (DREG) in the
capacity range of 500 kW to 2 MW. The scheme
also provides flexibility to allow DREG smaller
than 500 kW. Though the focus is on distributed
solar, other renewable generation technologies
are permitted as well. According to the guidelines,
KUSUM Component A is expected to result in
savings on transmission system requirement and
in a reduction of transmission and distribution
(T&D) losses.
Financing of the DREG under Component A is
primarily envisioned by individual farmers, group
of farmers, cooperatives, panchayats, Farmer
Producer Organisations (FPO), and Water User
Associations (WUA).
2.1 PROPOSED
3) As per TNERC Forecasting, Scheduling and Deviation Settlement for Solar and Wind generation regulations, 2017
the following deviation settlement applies: At Rs. 0.25 per unit for the shortfall or excess beyond 10% and upto 20% +Rs.
0.5 per unit for the shortfall or excess beyond 20% and up to 30% + Rs. 1.00 per unit for the balance energy beyond 30%
To compensate the generator for the revenue loss
on account of ‘off-take constraints’, the guideline
suggests that the DISCOM will procure excess
generation (beyond the forecasting estimate) equal
tothegenerationlossoccurredatthepowerpurchase
agreement (PPA) tariff in the succeeding 3 years.3
However, the generator is not eligible for
compensation in case the back-down is on account
of events impacting grid security or the safety of
any equipment, personnel or other such conditions.
A designated state entity will facilitate access
to financing, application and competitive
bidding processes and the development of the
DPRs. The scheme proposes a competitive
bidding where the pre-fixed levelised
tariff will be the ceiling tariff for bidding.
Waste land shall be used for the solar projects.
However, the guidelines suggest, that in case
fertile agricultural land is being developed for
solar energy generation, then co-location of crop
and solar energy generation should be done.
This requires elevated mounting structures
and appropriate spacing between the solar
modules to allow sufficient sunlight to
penetrate to the ground for the crops to grow
Offtake constraints due to back-down is proposed
to be compensated based on the following formula:
(Average Generation per hour during the Contract
Year) × (Number of hours of grid unavailability
during the Contract Year)]
Minimum Generation Compensation =
50% of [ (Average Generation per hour during the
month) × (Number of back-down hours during the
month) ] × PPA tariff
A sample power purchase agreement in the
annexure of the KUSUM guidelines,
introduces A generation compensation in
the case of grid back-down. It distinguishes
between generation compensation for
(i) Offtake constraints and
(ii) Generation compensation due to back-down.
The guidelines also mention that the DISCOM or
other private entities may take up the development
of DREG. A procurement based incentive
(PBI) of 0.40 INR/kWh or INR 6.60 lakhs/MW/
year, whichever is lower, has been introduced.
This PBI will be disbursed by the Ministry of
Power to the DISCOM for a five-year period.
‘Generation compensation for off-take
constraints compensates for the revenue loss
of the generator due to temporary transmission
unavailability. It is being calculated as:
Each is differently determined.
9. Making Sense of KUSUM7
The promotion of distributed renewable
energy generation (DREG), solar and other
renewables, is a welcome move. Equally so is
the flexibility given to the states in implementing
this scheme. The procurement based incentive
(PBI) for 5 years may set the right signals to the
DISCOM in actively promoting this scheme.
Insisting on a dedicated evacuation infrastructure
(e.g. a dedicated feeder) for the DREG, however, is
a counterproductive move. One key advantage of
DREG is the fact that production and consumption
of electricity occur at the same location, or in close
vicinity to each other, thereby reducing T&D losses
and optimizing the utilization of existing electrical
distribution infrastructure.The requirement for
a dedicated feeder for evacuation of electricity
generated by the DREG results in unnecessary
infrastructure costs and occupies valuable
DISCOM substation bays.
There will be many cases where there is no space
for the installation of one or more additional feeder
bays.
A highly relevant introduction is the proposed
‘generation compensation’. Unfortunately, the
actual proposed design of the compensation
mechanisms is rather convoluted and complex.
Generators should simply be compensated for the
deemed generation loss at the fixed tariffs as per the
PPA. Transmission planning is in the hands of the
DISCOMs,whowillhavetoensurethattransmission
expansion and capacity addition are well planned
and integrated. The DISCOM shall not permit
interconnection of DREG at a specific grid node in
the first place, if transmission congestion can be
expected. Making data about current transmission
constraints and future expansion plans available
in the public domain to Independent Power
Producers (IPPs) would be a much needed service.
2.2 CRITIQUE
In the case of backing down generators due to
transmission constraints, the generators shall
be fully compensated for their losses. Equally so
with the back-down due to off-take constraints.
It is the responsibility for the grid operator to
ensure uninterrupted grid-availability. Generators
need to be compensated for 100% of their
deemed generation losses due to gird back-down.
A certain percentage of grid back-down maybe
factored into the tariff itself. Instead of assuming
a 100% grid availability in the tariff determination,
a 97% grid availability can be assumed. This
would take care of grid back-down due to
monthly maintenance shut-downs and safety
concerns. Additional hours of back-down (beyond
the 97%) should be fully compensated for as
deemed generation at the tariff as per PPA.
The scheme proposes that individual farmers,
groups of farmers, cooperatives, panchayats,
Farmer Producer Organisations (FPO), and Water
User Associations (WUA) become renewable
energy producers. Despite the proposed support
by a designated state agency to facilitate access
to finances and provide techno-commercial
services, it is rather doubtful that the proposed
target group has the necessary cash equity
available to invest into energy generators and
the technical and administrative capacity. It also
remains to be seen, whether financing institutions
are willing to provide debt on a project financing
basis, especially to individual the farmers.
Considering that DISCOMS have a history
of delaying payments to independent power
producers - as per June 2019 this was in the
tune of 53,790 INR Crores 4
- the perceived risk
in relation to the possible return on investment
(refer to Table 1), for both, the bank and the
farmers, maybe too high to invest into KUSUM C.
4) Ministry of Power. https://www.praapti.in
10. Making Sense of KUSUM 8
5) TNERC. 2019. Order on generic tariff for Solar power and related issues. Order No. 5 of 2019 dated 29 -03-2019.
Accessed from: http://www.tnerc.gov.in/orders/Tariff%20Order%202009/2019/Solar-5-29-03-2019.pdf
6) Mericom India. Maharashtra Retenders 750 MW of Solar for Agricultural Feeders Due to Lack of Response https://
mercomindia.com/maharashtra-ag-feeder-solar-retender/
7) TNERC. 2019. Order on generic tariff for Solar power and related issues. Order No. 5 of 2019 dated 29 -03-2019.
Accessed from: http://www.tnerc.gov.in/orders/Tariff%20Order%202009/2019/Solar-5-29-03-2019.pdf
Figure 1 Cost-Benefit Analysis per kW solar capacity by Stakeholder | Kusum Component A
As per the solar tariff order by the Tamil Nadu
Regulatory Commission, the solar energy tariff for
the year 2019-20 has been determined at INR 3.04
per kWh. This solar tariff of INR 3.04 per kWh will
be the ceiling tariff for the proposed competitive
bidding. The TNERC solar tariff order considers a
capital cost of INR 3,35,000,000 per MW of solar
Asthecapitalcostofsmallerrenewablegeneratorsis
typicallyhigherthanthecapitalcostoflargersystems,
and considering the fact that the compensation
mechanism for losses due to off-take are not
covering the actual costs of generation, KUSUM
Component A may not attract any participation
It is financially not feasible for the generators.
Recent competitive biddings from 750 MW of its
solar feeder program in Maharashtra had an upper
ceiling tariff of INR 3.25 per kWh, however due to
lack of response, retendering will have to be done.
A per kW solar capacity cost-benefit analysis
undertaken, on the basis of the assumptions that
were used by TNERC in their Solar Tariff order 2019
and changing three of these assumptions, indicates
a post-tax internal rate of return (IRR) of 7% (refer
to Table 1) for the renewable energy generator and
an actual loss of 20% on the discounted cumulative
cash flow (NPV) over a 25-year time period.
In the proposed alternative the following
assumptions are modified:
The scheme in its current design primarily benefits
the DISCOM and the farmers with available non-
agricutlral land to lease next to a substation.
The generators - whether they are individual
farmers, groups of farmers, cooperatives,
panchayats, Farmer Producer Organisations
(FPO), Water User Associations (WUA) or
independent power producers however, are
unlikely to come forward and make investments.
The recommendation that only waste-land shall be
taken for project development is well appreciated.
The guidelines also open-up the possibility of using
agricultural land under the conditions that the solar
plant will be erected on stilts (e.g. on an elevated
structure) and that enough spacing between the
solar modules is required to allow the co-location
of crop production and solar energy production.
Overall, such an approach will result in additional
costs, and as it is a new approach, with little
research and piloting, one would do well in initiating
R&D projects, that would develop the techno-
commercial know-how for such an approach,
before commencing a commercial roll-out.
(i) instead of a 100% grid-availability, a 97% grid-
availability was assumed, (ii) a 1% of annual
electricity generation decrease on account of
solar panel degradation was introduced and
(iii) the capital cost per MW solar capacity was
increased by a 5% from INR 33,500,000 to INR
35,175,000. KUSUM Component A may simply fail
due to the fact that the financials do not work out.
43
-20
100
Savings 25 years (in %)
DISCOM GENERATOR FARMER
Gains 25 years (in %) Gains 25 years (in %)
11. Making Sense of KUSUM9
Permitting the interconnection of any DREG at
the high-tension (HT) and the low-tension (LT)
distribution network, as it is a common practices
in many other countries, is recommended.
DREG should be incentivized to connect at the
HT and LT side of the distribution transformer.
The locational value of distributed generation,
in particularly the avoidance of transmission
(and distribution) losses, may be priced and
used to provide an incentive to the generator.
2.3 ALTERNATIVE
8) Calculated as per TANGEDCO Revenue account for the year 2017-18. Profit & Loss Statements.
Figure 2 Cost Benefit Analysis per kW solar capacity by stakeholder | Alternative to KUSUM Component A
100
Suitable interconnection points may be determined
by the DISCOM based on load characteristics and
distributionnetworkcapacity.Feederanddistribution
transformer metering, if non-existent, could be
introduced by the DISCOM simultaneously with the
deployment of Component A. Interconnecting the
DREG at the existing distribution network avoids
capital expenses for a dedicated feeder, it benefits
theDISCOMasitavoidsanunnecessaryoccupation
of substations bays, reduces transmission and
distribution losses and results in a load reduction
upstream from the point of interconnection,
which in turn may not require upgrading the
transmission and distribution infrastructure.
With an Average Power Purchase (APP) cost of INR 5.65
and an average transmission loss of 8%, the locational
value or the DREG can be priced at INR 0.45 per kWh. This
locational value advantage can be shared 50-50 with the
generator, resulting in an incentive of INR 0.23 per kWh for
the generator (refer to Table 3). This locational incentive
could make the scheme successful. Compared to an IRR
for the generator of 7% as per the suggested approach
under KUSUM guidelines, the proposed alternative with
the locational value of solar increases the IRR to a 10%
And there is a cumulative cash flow gain of 22% instead
of a loss of 20%. Whereas the gains to the DISCOM
show a moderate reduction from 43% gains to a 39%.
The state implementation agency may take on a proactive
role in supporting individual farmers and others in the
bidding process (bulk procurement) for the entire allocated
target under KUSUM Component A - it could identify the
land, facilitate the grid-interconnection application, prepare
the PPAs and ensure timely payment by the DISCOM. It
could also facilitate the availability of low cost financing.
As for the co-location of solar energy and agriculture,
it is recommended that pilot projects are undertaken
before large deployment if this approach is undertaken.
The DISCOM and the generator may share the
savings on transmission (and distribution losses).
39
22
Savings 25 years (in %)
DISCOM GENERATOR FARMER
Gains 25 years (in %) Gains 25 years (in %)
12. Making Sense of KUSUM 10
9) Discounted Savings (NPV) on account of reduction in cost of electricity supply
10) Discounted savings (NPV) on account of subsidy reduction
Table 1 Cost-Benefit Analysis per kW solar capacity by Stakeholder - KUSUM Component A
Savings 25 years (%)
Savings 25 years (%)
DISCOM9
STATE GOVERNMENT10
Component A : Alternative
64,29069,587 3943
00 00
Component A
Savings 25 years (INR)
Savings 25 years (INR)
13. Making Sense of KUSUM11
Post Tax IRR
Gains 25 years (INR)
Gains 25 years (INR)
Payback
Gains 25 years (%)
Gains 25 years (%)
GENERATOR11
FARMER12
1315
1001001,5421,542
10
7
2319
-2078
22
-20
11) Discounted cumulative cash flow gain/loss
12) Discounted cumulative cash flow gain on account of lease of land to generator
14. Making Sense of KUSUM13
KUSUM COMPONENT C
Solarisation of 10 Lakh Grid Connected Agriculture Pumps
15. Making Sense of KUSUM 14
KUSUM Component C promotes grid-connected
solar for agricultural service connections (behind-
the-meter). The guidelines recommend to size
the solar system at twice the pump’s capacity
in horsepower (HP). Lower solar capacity is
permitted as long as the solar capacity in kW does
not fall below the pump capacity in HP. The farmer
will utilize the solar energy generated to meet
the electricity required for irrigation needs and
the solar energy surplus is injected into the grid.
The guidelines for KUSUM Component C provide
flexibility to introduce net-metering - where the
farmer may also draw electricity from the grid, if
and when required - or to limit the pump operation
to electricity drawn from solar generator only.
DISCOMs will purchase excess power from the
farmer at the rate decided by the respective state.
States may also formulate state specific
policies for grid connected solar pumps,
customised to the specific needs of the
respective State, as long as the broader
framework provided by MNRE are kept in mind.
Feeder-wise implementation is recommended.
States can set a minimum target of pumps to be
solarized per feeder. Feeders under KUSUM C will
have a ‘must-run status, to provide uninterrupted
daytime (sunshine hours of a day) power supply.
Thecentralfinancialassistance(CFA),a30%capital
subsidy, is limited for pumps of up to 7.5 HP. Pumps
with a higher capacity are permitted; however, the
maximum capital subsidy will be limited to the
subsidy applicable for 7.5 HP pumps. In addition to
the subsidy provided by the Central Government,
the state Government is required to support the
scheme with a 30% subsidy share. The remaining
40% of capital cost is expected to come from the
farmer via a 10% equity and a 30% debt financing.
The priority is set on small and marginal
farmers. The guideline also recommends to
give priority to farmers already using micro-
irrigation systems or those that are about to
adapt micro-irrigation in order to minimize water
usage and energy consumption for irrigation.
Possibilities would be explored by implementing
agencies for convergence of KUSUM Component
C with schemes on promotion of micro-irrigation
system and replacement of agriculture pumps with
energyefficientpumps.Themodalityforcoordinating
with respective Ministries/Departments will have
to be worked out by the implementation agency.
There is a domestic content requirement
for the solar system components under the
KUSUM C Component. A remote system
performance monitoring has been mandated.
3.1 PROPOSED
16. Making Sense of KUSUM15
In the context of the net feed-in mechanisms
of Tamil Nadu and the tariff as per TNERC
order for net-feed in of INR 2.28 per kWh, the
farmer’s IRR would be -19% over a 25-year
time period (refer to Table 2). The only possible
benefit for the farmer here is a reliable day-time
3-phase power supply, if that is made part of the
scheme implementation. The current design
on KUSUM C primarily benefits the DISCOMS
and appears to not be attractive to the farmer
In the case of Tamil Nadu, the State Government
would have to shoulder an additional capital outlay
on top of the currently provided subsidy of INR
2,850/year per connected HP, for the 30% capital
subsidy for the solar system provided to the
farmer without any direct gains from the scheme.
The scheme justifies the re-introduction
of electrical service connection meters for
participating farmers. This is expected to help
This presents a severe risk factor in further
increasing ground water extraction on account
of agriculture and accelerating the dire
water shortage in many parts of the country.
the DISCOM and the state greatly in getting a
better grip on the actual electricity consumption
that can be attributed for the agricultural sector.
A challenge for KUSUM Component C may be the
insistence on domestic content requirement for
the solar cells, solar modules and the balance of
the system. There is uncertainty on whether the
local manufacturing capacity is sufficient to deliver
the required solar cells, solar modules, balance
of system etc. in order to meet the KUSUM
targets. The domestic content requirement
will defer access to low interest capital from
international development banks., and may
risk a lawsuit by the World Trade Organization
As electricity is free of cost for the agricultural
consumers, the suggested financing model
(with a 40% contribution by the farmer) are
unlikely to work. The farmer simply has no
incentive to invest into solar energy generation,
despite the high capital subsidy that is provided.
The attempt to converge KUSUM with ongoing
micro-irrigation and efficient pumps schemes
presents a great opportunity to improve water
and energy efficiency. However, the guidelines
are silent on how this will be achieved, and
there may be a great risk that the proposed
convergence will be ignored altogether
3.2 CRITIQUE
Note: Under KUSUM Component C the farmer and the generator are identical.
Figure 3 Cost-Benefit Analysis per kW solar capacity by Stakeholder | KUSUM Component C
Savings 25 years (%)
DISCOM
Savings 25 years (%)
STATE
GOVERNMENT GENERATOR
Gains 25 years (%)
FARMER
Gains 25 years (%)
115
-248-55 248
17. Making Sense of KUSUM 16
The introduction of advanced irrigation control
systems, that delivers climate based and crop
specific irrigation schedules along with the micro-
irrigation should be considered. Such advanced
irrigation control systems can be programmed
in tune with the proposed time-of-use tariff
This will optimize the farmer’s income from
the proposed solar farmer incentive, contribute
to an advanced demand response program
of the DISCOM and possibly also increase
the crop yield of participating farmers.
Mandating advanced inverter functions under
this scheme presents another opportunity.
This would greatly benefit grid operations.
In return for providing a 30% capital subsidy,
the State Government may benefit from phasing
Examples of ToU export credit and import debit
factors:
1) Solar energy export credit factor during low
demand: 1.00 INR/kWh
2) Solar energy export factor during high demand:
1.50 INR/kWh
3) Grid energy import factor during low demand:
1.00 INR/kWh
4) Grid energy import factor during high demand:
1.50 INR/kWh
3.3 ALTERNATIVE
13) Auroville Consulting. 2019. Water-Energy-Land-Livelihood (WELL) Nexus. Energy as lever towards a sustainably
integrated resource management for Tamil Nadu’s Agricultural Sector.
Alternatively, a third party may invest into the solar
system and sell the gross-generated solar energy
to the DISCOM. In order to make this approach
acceptable to the farmer, a ‘solar farmer incentive’
designed to motivate the farmer to reduce its water
and electricity consumption can be introduced
Such an incentive may further be enhanced
by adding a time-of-use (ToU) component.
Such an incentive maybe be designed as:
out the subsidy disbursement to the DISCOM
for the farmers participating under KUSUM
Component C. This approach promises to
create a stronger incentive for the State to
commit to the 30% capital subsidy requirement.
The convergence of KUSUM with micro-irrigation
schemes and efficient pump schemes will require
inter-departmental coordination within the State
Government. It is highly desirable that drip
irrigation, where possible, will be mandated for
farmers participating under KUSUM Component A.
(Netsolarexport×Solarenergyexportcreditfactors)
- (Grid energy import × Grid import debit factor)
Figure 4 Cost-Benefit Analysis per kW solar capacity by Stakeholder | Alternative to KUSUM Component C
Savings 25 years (%)
DISCOM
Savings 25 years (%)
STATE
GOVERNMENT GENERATOR
Gains 25 years (%)
FARMER
Gains 25 years (%)
69 67
45 50
18. Making Sense of KUSUM17
Table 2 Cost-Benefit Analysis per kW solar capacity KUSUM C and proposed alternative
Component C : AlternativeComponent C
DISCOM9
STATE GOVERNMENT10
GENERATOR11
FARMER12
Savings 25 years (INR)Savings 25 years (INR)
30,344
93,919
69
115
Savings 25 years (INR)Savings 25 years (INR)
-16,200
45
-55
13,505
Gains 25 years (%)
Post Tax (IRR) Payback
Gains 25 years (INR)
16
-19
4,326
-13,409
67
-248
21
9
Gains 25 years (%)Gains 25 years (INR)
4,326
-13,409 -248
50
19. Making Sense of KUSUM 18
SUMMARY AND CONCLUSION
While KUSUM presents a healthy initiative in
turning the challenges related to free or subsidised
electricity supply into an opportunity towards
water and energy security, the current guidelines
appear to be rushed and not well-thought out.
Some elements in the guidelines, such as the
insistence on a dedicated feeder, the tariff
setting for competitive bidding and compensation
for power back-out in Component A, or in the
case of Component C the investment recovery
model for the farmer and the lack of strategy for
interdepartmental coordination to ensure that water
conservation technologies are fully integrated,
are risk factors and gaps that may not allow the
scheme to deliver on what is has promised to do.
What KUSUM promised to deliver is: an
income increase and reliable day-time power
supply for the farmers, the promotion of DREG,
the reduction in the cost of supply and the
reduction in transmission and distribution losses.
Though it will be finally the responsibility of the
various states to design and implement state
specific implementation models, these gaps
may need to be addressed at the central level.
With some specific modifications to the proposed
KUSUM Components A & C, these can be
turned into workable and scalable solutions.
Table 3 below compares KUSUM Component
A and C with its suggested alternatives
Though the proposed alternatives provide a
slightly lesser revenue gains to Discoms, they
make the schemes viable in providing shared
benefits to all stakeholders. KUSUM A & C, as
formulated in the guidelines, run the risk of not
taking off due to multiple program constraints such
as the domestic content requirement, insufficient
rate of return to the generators and farmers.
A moderately reduced revenue gain for the
Discoms greatly increases the chances for
the program to succeed. A program that is
not implemented does not benefit anyone.
As per the cost benefit analysis in the table 3 and
4 below, the suggested alternatives to KUSUM
Components A and C promise a well- rounded
approach that delivers benefits to all stakeholders.
The suggested alternative to KUSUM Component C
requiresalongergestationtime,asasmallersystems
take more time for implementation but overall this
alternative delivers the most promising results.
Kusum fails to address the interlinkages between
water, energy, land and livelihood. Especially
the lack of a coherent approach to address over-
extraction of ground water resources by the
agricultural sector remains a big concern. No
attempt for an interdepartmental approach was
undertaken. Additionally the introduction of a life-
cycle approach, that ensures proper disposal
and recycling of the solar equipment is lacking.
20. Making Sense of KUSUM19
14) Solar Net feed-in tariffs as per TNERC (Order on generic tariff for Solar power and related issues.)
15) Proposed gross feed-in tariff for RESCO with the 60% capital subsidy under KUSUM Component C
Notes: Under Component C the Generator and Farmer are the same entity.
Table 3 Comparison of KUSUM Schemes A, C and possible alternatives
14 15
21. Making Sense of KUSUM 20
OVERVIEW
Table 4 Cost-Benefit Analysis for various stakeholders per kW Solar
Savings 25 years (INR
Savings 25 years (INR
Savings 25 years (%)
Savings 25 years (%)
DISCOM9
STATE GOVERNMENT10
Component A
Component A
Alternative Component C
Component C
Alternative
115
69
43 39
93,919
30,344
69,587 64,290
13,505
-16,20000 -55
45
00
22. Making Sense of KUSUM21
Notes: Under Component C the Generator and Farmer are the same entity.
Gains 25 years (INR)
Gains 25 years (INR)
Gains 25 years (%)
Gains 25 years (%)
Post Tax (IRR) Payback
GENERATOR11
FARMER12
-248
21
9
15 13
-19
16
7 10
4,626
1,542 1,542 -13,409 50100 100
-248 67-20 22-13,409 4,326-2,078 2,319
23. Making Sense of KUSUM 22
1. Ministry of New and Renewable Energy (MNRE). 2019. Guidelines for Implementations of Pradhan Mantri Kisan
Urja Surakha evam Uttham Mahabhiyan Scheme. F.No. 32/645/2017-SPV Division. Accessed under: https://mnre.gov.
in/sites/default/files/webform/notices/KUSUMguidelines.pdf
2. Ministry of Power. Praapti. https://www.praapti.in
3. TNERC. 2019. Order on generic tariff for Solar power and related issues. Order No. 5 of 2019 dated 29 -03-2019.
Accessed under: http://www.tnerc.gov.in/orders/Tariff%20Order%202009/2019/Solar-5-29-03-2019.pdf
4. Mericom India. Maharashtra Retenders 750 MW of Solar for Agricultural Feeders Due to Lack of Response.
Accessed under: https://mercomindia.com/maharashtra-ag-feeder-solar-retender/
5. TNERC. 2019. Order on generic tariff for Solar power and related issues. Order No. 5 of 2019 dated 29 -03-2019.
Accessed under: http://www.tnerc.gov.in/orders/Tariff%20Order%202009/2019/Solar-5-29-03-2019.pdf
6. Auroville Consulting. 2019. Water-Energy-Land-Livelihood (WELL) Nexus. Energy as lever towards a
sustainably integrated resource management for Tamil Nadu’s Agricultural Sector. Accessed under: https://www.
aurovilleconsulting.com/system/attachments/190813_WELL_Nexus_single.pdf?1565756467
7. TNERC. 2019. Order on Rooftop Solar Generation. Accessed under: http://www.tnerc.gov.in/orders/Tariff%20
Order%202009/2019/Solar-25-03-2019.pdf
8. TNERC. 2019. Order on Rooftop Solar Generation. Accessed under: http://www.tnerc.gov.in/orders/Tariff%20
Order%202009/2019/Solar-25-03-2019.pdf
REFERENCES