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Electricity distribution companies (discoms) demand firm and uninterrupted renewable power. A new report by IEEFA and JMK Research highlights the important role that different mixes of generation sources and storage technologies can play in overcoming the intermittency challenge of variable renewable energy (VRE) and ensuring grid stability.
Renewable energy blended with either conventional thermal power sources that have low plant load factors (PLFs) or energy storage systems (ESS) can provide firm round-the-clock (RTC) power required by discoms, according to the report.
“There is increasing emphasis on firming of VRE-integrated power,” says Jyoti Gulia, lead author of the report and Founder, JMK Research. “This will be even more the case now that India has pledged at COP26 to install 500 gigawatts of non-fossil fuel capacity and to meet 50% of energy requirements from renewables by 2030.
“In India, we have seen renewable energy tenders evolve from plain vanilla solar or wind to hybrid to assured peak power to round-the-clock.”
Discoms are now driving a new set of tenders to manage their RTC power supply requirements with renewable energy sources that meet 80-85% annual capacity utilisation factor (CUF) conditions during peak and off-peak hours alike, Gulia adds.
The report, co-authored by Vibhuti Garg, Energy Economist and Lead India at the Institute for Energy Economics and Financial Analysis (IEEFA) and Akhil Thayillam, Research Associate at JMK, examines the key conditions of the Solar Energy Corporation of India’s (SECI) two RTC tenders to date.
Although described as “round-the-clock”, the authors point out that both tenders are not technically 100% RTC as they have minimum annual CUF requirements of 80% and 85%.
After modelling the possible mixes of generation sources and technologies, the authors find that, in the short term, a renewable-plus-thermal model may be best placed to meet the assured power supply conditions in SECI’s RTC tenders.
“Growth in new thermal power capacity is neither viable nor sustainable,” says co-author Garg. “The thermal power sector in India is already grappling with numerous stranded coal-based assets and an increasing amount of coal capacity that is being left idle.
“Bundling renewable energy with electricity generated in coal-based plants that have low PLFs to provide firm RTC power is one way to make use of some of this idle capacity.”
Garg explains that the government has recently issued guidelines that enable fossil fuel-based energy to be replaced by renewables under existing power purchase agreements (PPAs).
“As part of this change, thermal power generation companies are allowed to set up renewable energy generation capacity either by themselves or through other renewable developers by open bids and supply the electricity generated to consumers under their PPAs.”
In the longer term, as the cost of battery storage continues to decline steeply, the authors say that battery energy storage systems (BESS) are likely to become the most viable option for providing critical non-intermittent power.
The authors say India needs time-based incentives to help match renewable energy supply to demand. Looking at the different approaches to demand-based power supply in other countries such as the U.S., Germany and Chile can help India find a path forward.
To further enhance grid balancing, India could also explore options beyond physical aggregation of generation resources and storage technologies, such as virtual power plants, or VPPs, which are cloud-based networks of grid-integrated generation and storage assets.
“To make round-the-clock a reality in India,” says Gulia, “the renewable energy industry needs to work alongside policymakers, investors and other stakeholders to provide cost-effective power procurement models that target grid imbalancing, along with improvisation of capacity utilisation and reliability of power infrastructure.”