Minstry Plans to Replace 58,000 MU of Thermal Power with 30 GW of Renewable Energy by 2025-26


The Ministry of Power has recently unveiled a trajectory for the replacement of thermal power under which it is planning to operate thermal power plants at the technical minimum of 40 percent and supplement it with Renewable Energy under the tariff policy for bundling of Renewable Energy with thermal energy.


It has set a goal to replace thermal power by renewables by 2025/26. It also targets 500 GW of nonfossil fuel-based capacity before 2030.


The notification states that approximately 58,000 million units of thermal power (MUs), provided by public, private, and state generating stations, can be replaced with 30,000 MW of renewable electricity by 2025-26.


A capacity utilisation factor (22%) will determine the amount of renewable energy needed to replace thermal power. The ministry intends to replace coal at 81 thermal power stations in the central, private, and state sectors by 2026.

The government has said that India will operate thermal power plants (TPP) at the technical minimum of 40 percent in order to accommodate cheaper renewable energy. Power from TPPs with high tariffs is proposed to be replaced first under the scheme. “The existing regulations of CERC define a technical minimum of 55 percent up to which TPPs in the country can be operated. Reduction in generation from TPPs is feasible up to lower levels of technical minimum of 40 percent in 2 to 3 years,” said the ministry.

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All central public sector undertakings, states and power generation utilities must take the appropriate actions to reach the target. That is, 20% in the financial years 2023-24, 35% in the 2024-25 and 45% in the 2025-26 financial years.

According to the ministry, replacing thermal power with renewable energy will reduce carbon emissions and save significant amounts of coal each year. It will reduce concerns about coal availability and allow the country to meet its consumer demands. It is expected that the program will save 34.7 million MT of coal and reduce carbon emissions to 60.2 million MT.

Although station-specific targets were established, the notification states in part that a thermal power plant can substitute for more renewable power than the target. These targets are the minimum achievable for stations producing power.

A thermal generating station can substitute larger amounts of thermal power with RE power over and above the targets fixed by the ministry. And hydro generating stations can also bundle RE power along with hydro power to take part in the scheme, the ministry has said.

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