Newsletter - July 9, 2020
Can India push China out to make its place in the sun?
The world awoke to renewed uneasiness on June 15 as news of brutal clashes between Indian and Chinese troops in Galwan valley in Ladakh filtered through. As tensions escalated to the highest levels in decades, the conflict quickly expanded beyond the geographic battlefield. In many ways, this makes the matter infinitely complex as India and China are major trading partners.
In the immediate aftermath of the skirmish on the border, the Indian government fired the first shots in the field of trade. On June 29, 59 Chinese smartphone applications were banned in the country owing to security concerns. On July 3, Union power minister RK Singh announced that India would stop imports of power equipment from China, which forms the bulk of India’s imports from the country, and Pakistan. The ministry had, a week earlier, proposed a Basic Custom Duty (BCD) of 15% and 25% respectively for solar cells and modules imported from China once the current safeguard duty of 15% on solar cells and modules originating from Malaysia and China expires on July 31, 2020. An import duty of 20% has been proposed for solar inverters. Subject to parliamentary approval, the BCD could further be hiked to 40% in 2022.
Like the banning of Chinese apps, the prohibition of Chinese power equipment is also linked to security concerns. Notably though, the move has also been linked with the ‘Atmanirbharta’ campaign of self-reliance that the BJP-led NDA government has put its weight behind in recent weeks. Similarly, the BCD is seen largely as an extension of the safeguard duty that was in effect for the past two years with an objective of promoting domestic manufacturing of solar cells and modules.
According to figures published by the Directorate General of Commercial Intelligence and Statistics (DGCI), electrical machinery and equipment accounted for about a third of the total imports of ₹26.08 lakh crore ($392.29 billion) in the six years between 2014 and 2020. Along with machinery pertaining to nuclear reactors, the proportion of imports related to energy and power to the total stands at a staggering 50% over the past six years. Chinese investments in India, which are skewed towards energy, technology and infrastructure, have also come under the scanner in recent weeks. According to the China Global Investment Tracker (CGIT), a database maintained by the American Enterprise Institute and Heritage Foundation, India received US$14.75 billion worth of investments from Chinese entities during the 2007-19 period with energy and tech ruling the roost. A Brookings report released in April 2020 claims that net Chinese investment in India grew five-fold from US$1.6 billion to US$8 billion between 2014 and 2017.
However after the clash at the border, several states have moved to end existing contracts with Chinese firms, while as many as 50 investment proposals from Chinese companies have come under renewed examination. Additionally, recent funds announced for DISCOMs through the Power Finance Corporation (PFC) and the Rural Electrification Corporation (REC) will be done with import-dependency on China as a criteria.
Adieu to the record solar bid era?
As the Ministry of Power announced that it would seek to hike the BCD on solar cells and panels imported from China to 40% by 2022, a 2GW solar auction conducted by the Solar Energy Corporation of India (SECI) on June 30 managed to attract a record low bid of ₹2.36/unit from Spain’s Solarpack Corporacion to build 300MW of PV projects. Additinally, the auction was oversubscribed by 1.8 GW with nine bidders in total.
Ultimately, all seven winners, after the reverse bidding process, bid lower than the previous record low tariff of ₹2.44/unit. Interestingly, as pointed out by Bloomberg NEF, winners of the SECI auction will effectively be exempt from the BCD under the “Change in Law” clause of their power purchase agreements since bids were placed before the official announcement of the new taxes. The Bloomberg report explains the aggressive bidding in the auction as a result of the temporary window of nil import taxes that has effectively opened up, and the availability of cheaper foreign debt to overseas companies.
With imported solar modules and cells from China set to become more expensive as the temporary window closes, the recent record bid might stand for a while despite costs of modules and cells continuing on a downward trend. “With imports from China becoming more expensive, there is a good chance that we might see an increase in tariff in the near future. Auctions might still be held but the SECI might find it difficult to sell this down the line to DISCOMs. This might have an impact on India’s renewable targets. Demand for PV modules, given the capacity addition targets, is more than what domestic capacity can cater to, and at prices that don’t allow bids of sub INR 2.5 as we’ve been seeing recently” says Kanika Chawla, director at the Centre for Energy Finance at the Council on Energy, Environment and Water (CEEW).
Over a longer term, however, the effects will be marginal, believes National Solar Energy Federation of India (NSEFI) CEO Subrahmanyam Pulipaka. “Nobody can say for sure how tariffs will evolve. Even with the reported record bids, there are several nuances of the contract that are not publicised in the media, which actually could increase effective costs. In the short term, module prices will increase and this might get reflected in bids in the near future. Right now, there are 111 projects worth 30GW of energy that have already been bid out. These are eligible for the “Change in Law” compensation, which the government has said it will consider case by case. Similarly, rooftop solar in the pipeline must also be grandfathered,” says Pulipaka. “Over a longer term, how tariffs develop depends on our domestic manufacturing capabilities. After all, energy transition without energy security means little.”
Regarding the proposed BCD regime, the power ministry has clarified that duties will not be imposed retroactively and solar projects with PPAs will be exempt. The government has ensured that it will provide Viability Gap Funding (VGF) to bridge the gap in costs once the new regime is enforced for projects that were signed before the announcement. Although details regarding how the VGF shall be determined and disbursed remain sparse.
The Manufacturing Gambit
Improving the manufacturing capacity of solar cells and modules in the country has been high on the government’s list of priorities for some time now. The safeguard duty, due to expire this month, was put in place two years ago to increase competition between domestic manufacturers and their Chinese and Malaysian counterparts. The measure though has not yielded the desired results as growth in manufacturing capacity has remained minimal. “The safeguard duty failed to accelerate India’s solar manufacturing capacity, since the measure was undercut by the government’s move to grandfather projects that had been affected and provide funding for the price difference due to the duty. Similarly, Chinese manufacturers also managed to offset some of the cost increase from the duty by providing cheaper rates,” says Vibhuti Garg, a senior energy specialist at the International Institute for Sustainable Development (IISD).
However, this is unlikely to happen with the BCD regime, feels Pulipaka. “The BCD regime is more permanent than the safeguard duty and can be revised upwards, and more countries could be brought into this net, so solar developers and manufacturers will consider the BCD more seriously in their planning processes than they did the safeguard duty. The COVID-19 pandemic has also been a game-changer since supplies from China were the first to be hit, the vulnerability of the supply chain has re-awoken solar developers to the need for strong domestic manufacturing capacity.”
India’s current manufacturing capacity for solar cells and modules stands at just over 3GW and 11GW respectively, with imports occupying about 85% of the current Indian market – most of which are Chinese in origin. Current Indian demand for cells and modules stands at about 20GW and 10GW respectively, manufacturers have failed to scale up owing to high costs of setting up plants, and the competitive advantage in terms of price enjoyed by their Chinese counterparts. Although the manufacturing capacity of modules is higher than the current demand, domestic supply lags demand due to chronic under-utilisation of manufacturing plants. Manufacturers have also claimed that the ‘approved list of models and manufacturers’ (ALMM) regime which involves enlisting at a hefty fee deters upgradation and effectively punishes innovation.
India, in 2017, mandated Domestic Content Requirement for solar projects with different proportions of domestic cells and modules mandated for different categories of projects. This DCR has effectively created a sizeable demand in the country, including India’s 25.75GW solar pump programme, KUSUM, and the 40GW rooftop solar programme. This, and demand borne from other larger scale projects, currently outstrips India’s manufacturing capacity. The central government is reportedly busy outlining a strategy to incentivise solar manufacturing in order to facilitate rapid expansion in coming years. Curiously, while India’s manufacturing infrastructure is unable to meet domestic demand, Indian manufacturers registered a doubling in the export value of cells and modules last year.
The reason for this, says Pulipaka, is that exporting to Europe and the US routinely fetches better prices than the Indian market where competition with cheaper Chinese imports in rife. “On an average, Chinese cells and modules are 20-30% cheaper than Indian manufactured equipment. So while DCR has created sizeable demand, manufacturers who are confident of their qualitative advantage over Chinese products would still prefer to sell to western markets rather than compete with imports in the Indian market. The hope is that this will change with a progressive BCD regime, which will make indigenous equipment more competitive.”
But it isn’t just the price that has hindered solar manufacturing from the achieving economies of scale. What’s crucially missing is comprehensive manufacturing policy, which must begin with interest compensation, adds Pulipaka. “A big competitive edge foreign manufacturers have enjoyed is easy access to capital, which can be achieved in India through interest compensation. Apart from this, India must move to subsidise and incentivise innovation and technology in the field, which it has so far failed to do,” he says.
The task of setting up a self-sufficient solar supply chain is easier said than done. “While increasing India’s module manufacturing capacity has been within reach for a few years now, we are far from creating our own supply chain as we still depend on China for cells, wafers, polysilicon, and the machines for manufacturing such equipment. Unless we strategically determine the balance of being self reliant and well integrated with global supply chains, our position in the value chain is open to manipulation, and gains from increased manufacturing will be in a compromised” says Chawla. “The 20 – 40% BCD regime might fare well in improving Indian capacities of manufacturing but self-reliance is equally dependent on innovation and progressive upgradation of indigenous technology and capacity, which needs to be incentivised. Ploughing back the revenue from duties could go some distance in incentivising manufacturing, which did not happen with the safeguard duties.”
While the situation on the Indo-Chinese border has de-escalated over recent days, relations between the two countries though will undoubtedly remain strained for the foreseeable future. In fact, if global precedence in recent decades is to be given due consideration, it can well be assumed that economic measures and countermeasures between the two countries will only compound over the coming years. India has fired the first shots, with aim firmly set on the power and energy sectors, recognising the importance of the Indian market for Chinese companies and investors.
Unfortunately, India’s clean energy transition, too, will then depend on how Indian manufacturers manage to fill the gap that has been created. The prohibition of certain imports and the hike in import duties can only be the first small step in ensuring self-reliance. More critically, these need to be followed up with measures that can sustain a self-sufficient supply chain — which currently is little more than a distant mirage. Failure to do so will guarantee collateral damage, which might even jeopardise India’s clean energy future.
Mumbai goes under as rain lashes India’s west coast
Rain lashed the western coast of India this fortnight, especially in Mumbai, which flooded quickly after continuous rain spells for 4-5 days. Next in line is neighbouring Gujarat as the India Meteorological Department (IMD) issued an ‘extremely heavy rain’ alert for India’s Saurashtra region. Several National Disaster Response Force (NDRF) teams have been deployed in the state after the IMD alert. North India reported scattered rain across Delhi and its adjoining areas, although this, too, is expected to increase.
Monsoon has covered most parts of the country a week early, according to the IMD. The only states remaining so far are Haryana, parts of Rajasthan and Punjab. Rainfall has been 22% excess of the long-period average (LPA) till Wednesday.
While a robust monsoon is certainly welcome news for India, there has been a change in the rainfall pattern. While South India has recorded less rainfall this year, central India has received excess rainfall. According to India’s first climate change assessment report published by the Union Ministry of Earth Sciences on June 17, this change in pattern could be indicative of global warming. While monsoon arrival dates would remain largely the same, retreat dates are likely to get extended, leading to a longer monsoon season. This would make locust invasions a perennial problem for India, according to the report.
The Food and Agriculture Organisation (FAO) has warned India to remain on high alert against attacks for four weeks, prompting the government to deploy Bell helicopters and drones in India’s heartland states to control the spread.
Climate change leading to mass loss in two glaciers in Himachal Pradesh, Ladakh: Studies
Recent studies found climate change has had a significant impact on the glaciers in the western Himalaya region. The studies, conducted by Jawaharlal Nehru University’s (JNU) glaciology unit, monitored two glaciers — Chhota Shigri glacier in Himachal Pradesh and the Stok glacier in the Union Territory of Ladakh — and found glacier mass loss to be significantly higher in the beginning of the new millennium than it was at the end of the 20th century. The study linked this loss to rising temperatures and reduced snowfall. While the authors say the glaciers will not disappear any time soon, their negative mass balance will impact the availability of water for local communities.
Wildfires burn in Indonesia, Arctic as Brazil sees record fires for month of June
Forest fires continue to blaze across the world. The Indonesian province of Central Kalimantan declared a state of emergency after reporting 700 forest fires. The province will now see increased patrolling and early extinguishing efforts. The country’s forest fire patrolling team is already facing budget cuts with the COVID-19 pandemic, while Indonesia, which is the third-largest producer of palm oil, has already scaled back protection of its tropical forests.
In the Arctic, forest fires have worsened. A major fire is currently burning outside the town of Chersky, and is threatening to destroy a major power line as well as a park that was set up to recreate the subarctic steppe grassland ecosystem that flourished in the area during the last glacial period.
Brazil, meanwhile, recorded the highest number of Amazon fires – 2,278 – for the month of June since 2007, Brazil’s National Institute for Space Research (INPE) found. This number is much higher than the 1,880 fires detected by the INPE in June last year using satellite imagery.
Globally warming waters could destroy reproduction process in 49% fish species: Study
The world’s oceans, rivers and lakes will be too hot for 40% of fish species in the spawning and embryonic stage by the end of the century thanks to climate change, according to a new study published in the journal Science. The study assumes significance because biologists have only focused on the impact warming waters have on adult fish so far. The study’s results mean that these species could either become extinct or will have to change the way they reproduce.
Delhi HC pushes deadline to give suggestions for draft EIA 2020 to Aug 11
After a repeated outcry from activists, the Delhi high court extended the deadline for giving suggestions to the draft Environment Impact Assessment (EIA) Notification 2020 from June 30 to August 11. The contentious clauses in the draft include the regularisation of projects that violate environmental norms and shortening the time given to public hearings.
Environmentalists’ objections to the draft notification are significant considering the rate at which eco-sensitive land, such as forests, are being given up for infrastructure projects. An analysis by a PhD student from Columbia University, Vijay Ramesh, revealed that forest land nearly as big as Nagaland was approved or is pending to be approved for diversion between 2014 and 2020 for infrastructure projects such as irrigation, mining and encroachment regularisation.
Another recent study mapped out how linear infrastructure, such as roads, power lines, canals and pipelines, affect forest fragmentation. The study found that such infrastructure had caused a 6% rise in the number of small patches and a 71.5% fall in the number of large forest patches.
HC stays Karnataka wildlife board nod to Hubballi-Ankola railway line
The Karnataka wildlife board’s clearance for the 168-km Hubballi-Ankola railway line, which will run through the Western Ghats and requires felling of more than 1,57,000 trees, has been stayed by the Karnataka high court. The clearance had been given despite objections from senior members of the board in March this year. Most of the proposed project runs across forest land, according to a site inspection report submitted to the Ministry of Environment, Forest and Climate Change (MoEFCC). The railway line will cut across the Bedthi Conservation Reserve, the Hornbill Conservation Reserve and the buffer zone of the Kali Tiger Reserve.
The controversial 240-km Thalassery-Mysuru line in Kerala is back in the news after the government presented an alternate proposed for a tunnel in the Bandipur and Nagarahole forests. The government hopes to give an economic boost to Kannur and Wayanad by providing a direct rail link from central Malabar to Mysuru and Bengaluru, much to the chagrin of environmentalists, who think the project will destroy the area’s rich biodiversity.
Confusion, uncertainty mark India’s coal block auction process
Almost a fortnight after India’s Prime Minister Narendra Modi launched an auction of 41 coal mines for commercial mining, it has become glaringly apparent that the central and state governments where these coal mines are located are not on the same page regarding the move.
Jharkhand, which is home to 22 of the coal mines, has already moved the Supreme Court over the auction, alleging the Modi government has ‘taken the decision in haste, without taking state governments into confidence’. In Maharashtra, after strong criticism from the state’s environment minister Aaditya Thackeray and forest minister Sanjay Rathod, the Union coal ministry has decided to scrap Bander coal blocks, near the buffer and eco-sensitive zone (ESZ) of Tadoba-Andhari Tiger Reserve (TATR), from the auction list. Even Chhattisgarh has managed to get four blocks — Sayang, Madanpur (North), Morga (South) and Morga-II — in the Hasdeo Aranya area off the auction list as this region has been declared a Lemru elephant reserve. While downplaying the opposition to the auction, however, coal and mines minister Pralhad Joshi said the Centre was open to tweaking the auction on the request of state governments.
Activists allege conflict of interest in Etalin project cost-benefit analysis
The Arunachal Pradesh government, in response to a 25 June request by the Indian environment ministry request to submit a cost-benefit analysis for the Etalin hydropower project, has submitted an analysis prepared not by the state, but by Etalin Hydro Electric Power Company Limited- the developer of the project. The analysis was requested following environmentalists protesting the loss of 270,000 trees at the thickly-forested junction of the Paleo-arctic, Indo-Chinese, and Indo-Malayan biogeographic regions. Environmentalists have now pointed out the blatant conflict of interest in the developer preparing the analysis, while project stakeholder Jindal Power has asserted that the analysis was done as per guidelines prescribed by the environment ministry.
Jamaica first Caribbean nation to submit upgraded climate plan to UN
Jamaica has become the first Caribbean nation and the 11th nation to submit a tougher climate action plan under the Paris Agreement to the United Nations (UN). The new plan addressed land use change, forestry emissions, and also committed to deeper emission cuts in the country’s energy sector. The country has now committed to reducing its emission levels by 25.4% below ‘business as usual’ levels by 2030, or even by 28.5% if it gets international support.
UN body postpones airlines’ climate obligations
Airlines are not obligated to offset their carbon emission growth until at least 2023. The International Civil Aviation Organisation (ICAO) took the decision to postpone the obligations after the intervention of the International Air Transport Association (IATA), which lobbied to change the baseline to measure emissions growth in order to reduce the sector’s carbon costs.
Germany: Coal to be phased out by 2038
Germany’s parliament, last friday, passed legislation that would end the use of coal in the country by 2038 as part of their decarbonisation roadmap. The legislation rests on two main features- the first establishing a legal framework for the gradual reduction of emissions while the second focuses on regional economies impacted by the move. A fund of EUR40 billion has been set aside to help coal producing regions absorb the economic impact.
Styrene gas leak deaths: LG Polymers CEO, 2 directors among 12 arrested
Andhra Pradesh police on Tuesday arrested 12 people, including the CEO and two directors of South Korean firm LG Polymers Ltd, two months after styrene gas leaked at their plant in Visakhapatnam, killing 15 people and injuring 500 others. Three officials have been suspended for negligence.
Company’s managing director and CEO Sunkey Jeong, technical director D S Kim (both South Korean nationals) were among those who were arrested a day after the state panel submitted a report to chief minister Y S Jagan Mohan Reddy blaming the LG Polymers management for its negligence. The accused are being produced before the court for judicial remand.
The probe stated that the factory be moved away from inhabited areas. Meanwhile in two other gas leak cases in Andhra Pradesh, India’s green court, the National Green Tribunal (NGT) ordered two companies to pay interim relief to victims. Two workers were killed and four were hospitalised after inhaling leaked Benzimidazole gas at the pharmaceutical unit of Sainor Life Sciences factory in Visakhapatnam on July 3. In the second incident, one person died and three were injured inhaling ammonia gas that leaked at SPY Agro Industries on June 26. A panel of state and central pollution control boards will file probe reports within three months.
Study reveals elemental loads in Delhi’s winter air, 3 air corridors spiking Delhi’s pollution
A new “source apportionment” study conducted real-time analysis during two consecutive winters of 2018 and 2019 in Delhi and found 35 elements (metals and non-metals) in the Capital’s air, 26 of them in high quantities.
Scientists also found three air corridors of Punjab, Haryana and Uttar Pradesh spiking Delhi’s pollution during winter. The study revealed that each of the three states were contributing to a specific set of elements, the combination of which allowed them to identify particular industrial sources of pollution.
The dominant PM10 elements were chlorine, sulphur and crustal material (ie, silicon, calcium, titanium, and iron). The elements measured amounted to around 25% of total PM10 in 2018 and around 19% in 2019.
Lockdown impact: 4 cities achieved 95% of 2024 NCAP targets in just 74 days
Restrictions on economic activity between March 25 and June 8 saw pollution levels plummet across the country and offered researchers an opportunity to track baseline pollution levels in major Indian cities — a bit of crucial information that had so far remained elusive. The trends established that the lockdown measures resulted in these 4 cities achieving 95% of their 2024 NCAP targets in a short span of 74 days.
The lockdown led to a significant decline in air pollution levels for major cities across India. Researchers from Respirer Living Sciences and Carbon Copy analysed average air quality during the four national lockdown phases as well as during local lockdowns initiated by metros Delhi, Mumbai, Kolkata and Bengaluru. Concentrations of PM2.5, PM10, nitrogen dioxide (NO2), carbon monoxide (CO), ozone (O3), and Benzene were tracked to monitor the implementation of the National Clean Air Programme (NCAP).
EU carmakers likely to miss emission targets kicking in this year
Warming carbon dioxide (CO2) emissions from cars in Europe have risen for the third consecutive year in 2019, stated the report by European Union’s environment agency (EEA).
The agency warned the carmakers that they are at risk of missing tough European targets coming into effect this year, if the companies fail to reduce emissions significantly.
Reuters reported that average emissions for new cars in the EU’s 27 member states plus Britain, Iceland and Norway were 122.4 grams of CO2 per kilometre in 2019, an increase of 1.6g compared with 2018, the EEA said.
Automakers would need to slash their emissions by 22% from 2019 levels (130g of CO2 per kilometre). The 2020 target caps average CO2 emissions from new cars at 95g CO2/km, Reuters reported.
China to cancel subsidy for waste-to-energy power plants over Dioxin risk
As part of an anti-pollution drive, China will suspend subsidies for waste-to-energy (WTE) power plants that violate emissions norms. WTE power plants in China have caused much public discontent over the issues of stench and the risk of toxic emissions, such as dioxin.
Last year, China compelled waste incinerators to make public real-time emission and temperature data and post it on the environmental bureau monitoring system. Now, the government plans to cancel subsidies of those plants that fail to reveal data.
Tariff hits new low at ₹2.36; will developers complete the job or go ACME way?
India set a fresh record of low tariff — ₹2.36/kWh, in a 2GW auction by Solar Corporation of India (SECI). This is about 3.3% lower than the previous lowest bid of ₹2.44 (~$0.032)/kWh, which was won by ACME in 2017 and 2018. This time, six foreign companies won projects, while Renew Power was the only Indian firm among the winners.
Spain’s Solarpack won 300 MW at Rs2.36 per unit, while Italy’s Enel and Germany’s IB Vogt won 300MW each at ₹2.37 per unit. Canada’s AMP Energy and New York-based Eden won 100MW and 300MW at ₹2.37 per unit. ReNew won 400 MW at Rs2.38 (~$0.0316)/kWh.
Italy’s biggest power utility Enel will be financially backed by Norwegian Investment Fund Norfund to build its renewable projects in India.
Why the new low? Experts say this is one of the “vanilla” solar tenders, and not the more complex round-the-clock and peak power schemes which fetch higher tariffs. Developers say the Basic Customs Duty (BCD) for the projects whose auctions were held before July 29 will be exempted, and even the Approved List of Models and Manufacturers (ALMM) will not be applicable, Mercom reported. Critics say it could also go the ACME way. The company is in a legal battle with the regulator over reneging on a contract.
Centre extends RE project deadline by 98 days, developers say not enough
As a relief to solar energy companies struck by COVID-19 disruptions, the Centre has extended project deadlines by 98 days — 68 days of the lockdown period from March 25 to May 31, and an additional 30 days to cope up with disruptions.
This may not help the developers facing different lockdown durations in states such as Maharashtra, Tamil Nadu and Jharkhand, which have extended lockdowns to July 31.
Developers are also badly hit by the labour crisis following the mass exodus to villages earlier on. The government has already declared the lockdowns a force majeure for renewable energy companies. Developers have asked for a grace period of six months. In May, solar developer ACME dropped out of a 2018 project citing COVID-19 uncertainties.
India-China Border tension: Delays ‘hurting’ domestic solar projects; 40% duty on imports from August 1
Border tensions with China are impacting Indian solar energy projects. The consignments that the developers have already paid are stuck at the ports, delaying the projects across the country, which imports around 65% of the panels from China.
Amid the border issues, India has decided to raise basic Custom duties on Chinese solar products by 40% in a year, beginning from 20-25% from August. Experts said the country requires solar modules worth ₹15,000 crore per year, and 80% of it is imported.
Meanwhile, the government may not charge import duties from developers who have valid power purchase agreements (PPAs) as on 1 August, 2020. If duty exemption is not available, the government will reimburse developers for duties paid.
India’s solar capacity addition ‘to drop by 15%’ in FY21; India to add only 60GW RE by 2025?
Ratings agency ICRA said COVID-19 disruptions will result in 15% drop in India’s domestic solar capacity compared to its previous estimate of 7.5GW. India is expected to add about 5.5 GW during the financial year 2020-21 (FY21), the report stated.
The drop in demand post lockdown impacted revenues of the state-owned distribution utilities, which has increased the credit risks. The payment delays from Andhra Pradesh, Telangana, and Tamil Nadu remained severely stretched at 10-12 months, impacting the overall liquidity position of developers, the report said.
Meanwhile, in an abjectly low projection, a new study says India is expected to add only 60GW of renewable energy capacity in the next five years. The Bridge To India’s renewable energy CEO survey report 2020 projects a “very low” 12GW per annum capacity addition. The government wants to achieve 175GW by 2022 and 450GW by 2030. India’s utility scale solar capacity was 32.2GW and wind capacity was 37.6GW as on March 31, 2020.
ISA going strong: India’s NTPC to help set up 500MW solar park in West Africa
State-owned National Thermal Power Corporation (NTPC) will help set up 500MW solar park in Mali, in West Africa. The NTPC has a target to set up a total 10GW of similar solar projects in other member states of the International Solar Alliance.
Indian state-owned companies, including Solar Energy Corporation of India, are entering international business space under the aegis of International Solar Alliance (ISA), as China continues to co-opt countries into its ambitious One Belt One Road initiative.
ISA’s business model is to reduce costs by aggregating the demand from member nations and then call for tenders. ISA has aggregated demand for solar pumps, rooftops, mini-grids, parks and home systems that require around $5 billion of financing requirement, Mercom reported.
RE projects roundup: Greenko to develop 1GW solar project in Andhra Pradesh, Avaada and Tata Power set to start Maharashtra assignments
The state of Andhra Pradesh approved Greenko to set up an integrated renewable energy project (IREP) at Pinnapuram village in Kurnool district. Within four years Greenko must set up 1,000MW of solar projects, 550MW of wind projects, and 1,200MW of pumped storage capacity, failing which the government will take back the 4,766.28 acres of land allotted to the company.
The Maharashtra State Electricity Distribution Company Ltd (MSEDCL) awarded 350MW of solar project to Avaada, expected to roll by January 2022. Tata Power will develop 100MW of solar projects for MSEDCL at a tariff of Rs2.90 (~$0.04)/kWh.
The Rajasthan State Agricultural Marketing Board announced a tender for about 1.6 MW of locally manufactured rooftop solar systems, linked to the grid. The project is estimated to cost Rs103.3 million (~$1.37 million) and is expected to be completed in a year.
Wind power generation doubles in Gujarat amid heavy rains
Gujarat’s average wind power generation has doubled in the past couple of days following strong winds accompanying heavy rains in many parts of Gujarat. This has led to a reduction in electricity generation from thermal (coal, gas and lignite) power plants in the state, ET reported.
Wind power generation last Sunday was 88MW, which according to state data, contributed almost 20% of the peak power demand of 12,136 MW on Tuesday. Gujarat’s current installed wind power generation capacity is 5,691MW. Pre-monsoon activity pushed up average wind power generation to a high of 3,947 MW on May 28.
Denmark’s Orsted, Taiwan’s TSMC sign world’s largest wind power deal
Taiwan Semiconductor Manufacturing Co (TSMC) is set to buy the entire power produced by Denmark’s Orsted which the company produces at its third offshore wind farm in Taiwan. In what Orsted called the largest-ever contract of its kind within renewable energy, for the next 20 years TSMC will buy 920 MW of wind power from the project scheduled to be finalised by 2025 or 2026.
BP to invest $70 million to UK-India green growth fund
Oil and gas giant BP will invest $70 million in the UK India Green Growth Equity Fund (GGEF), which is backed by the UK and Indian governments. The deal will allow BP to become a limited partner in the GGEF, with representation on its advisory committee and scale up “commercially viable, integrated low-carbon energy projects” alongside the GGEF, BP said. The company plans to go carbon neutral by 2050.
Netherlands, Belgium launch self-piloting electric barges
The Netherlands and Belgium have launched the world’s first full-electric barges with the help of a £6 million subsidy from the EU. The barges will be charged with renewable power and will be emissions-free, and are expected to ferry up to 425 tonnes of cargo from the ports of Rotterdam, Antwerp and Amsterdam. They will also have 8% more onboard space due to the lack of an engine room, and their 20-foot batteries will help them run for 15 hours on a single charge.
First automated heavy duty buses to be launched in Connecticut, US
The north-eastern US state of Connecticut will soon debut the country’s first fully-automated and fully-electric fleet of heavy duty transit buses. The three 40-foot buses have been developed by bus manufacturer New Flyer of America and the project will be North America’s first venture into automated heavy-duty transport. The buses’ charging systems will be supplied by Robotics Research, which is also partnering to build their automated command systems, and the overall project is supported by the Federal Transit Administration’s Integrated Mobility Initiative (IMI).
EVs post impressive rise in Germany despite 35% slump in new car registrations
Germany has reported a 35% slump in its new car registrations for H1 2020 over the COVID-19 pandemic, and a 40% drop in production in export year-on-year. These are the lowest figures for the country’s widely respected auto sector in 30 years, but EVs continue to post impressive uptake, with their registrations expected to jump by 90% for the first half of the year.
Battery electrics will account for 40% of the rise, while plug-in hybrids are expected to post a whopping 190% jump in registrations. The numbers are partly as a result of the German government doubling its EV subsidies from EUR 3,000 to 6,000, as it endeavours to boost electric mobility in a market dominated by the IC engine.
Siemens to “store” thermal power in batteries to decarbonise industrial output
Germany’s Siemens Energy is tying up with Norway’s EnergyNest in a novel venture to store thermal power in specially formulated concrete batteries and gradually decarbonise industrial activity. The batteries are made of high energy density “Heatcrete” concrete, which will use a heat transfer fluid to transfer and store heat from thermal power plants.
The 20-ft battery modules are claimed to be easily manufactured using common materials, are recyclable and can be scaled up from MWh to GWh applications. Interestingly, a similar project in the Netherlands is trialling the replacement of natural gas with thermal batteries that are charged with renewable energy.
Second blast at Neyveli kills six, raises questions on plant’s Life Extension Program (LEP)
A second blast at the fifth unit of the Neyveli thermal power station in as many months has claimed six lives and left 17 personnel with serious injuries. The blast is suspected to have been caused by overheating and excessive pressure at the boiler, but inadequate maintenance is also being investigated, since every thermal power plant in the country must undergo a Life Extension Programme (LEP) check in the 20th year of its typical 25-year lifespan.
All four units commissioned in the second phase of the plant’s history have now been shut down for an LEP inspection, under which their operational worthiness will be re-examined. They could be re-certified for another 15-20 years if so recommended.
Baghjan oil well fire: NGT imposes an interim fine of ₹25 crore on OIL
An interim penalty of ₹25 crore has been imposed on government-owned OIL India for its failure to rein in the fire and gas leak from an oil well in the Baghjan oilfield in Assam’s Tinsukia district. Well number 5 in the oilfield has been spewing gas since it caught fire on June 9 when it caused the deaths of two OIL firefighters. The bench comprising Justice S P Wangdi and expert member Siddhanta Das constituted a committee headed by former high court judge B P Katakey to probe the matter and submit a report within 30 days.
Germany passes 2038 coal exit law, Hambach forest survives
Germany has passed into law its proposal to fully exit coal mining coal power by 2038, and the exit comes with compensation worth EUR 40 billion for affected regions. The law differentiates between shutting down lignite and hard coal facilities, but both will be phased down equally in three phases: down to 15GW each by 2022, to 8GW of coal and 9GW of lignite by 2030, and to zero by 2038. The phasedown will be reviewed three times, once each in 2026, 2029 and 2032, and will assess if the phaseout can be completed by 2035.
The law also means that the embattled Hambach forest, which was to be mined for lignite to feed RWE’s plants, will not be touched. RWE, for its part, will be compensated with EUR 2.6 billion for shutting down its plants by 2029.
Spain shutters seven of its 15 coal plants, may go coal free by 2025
Spain has shuttered seven of its last 15 coal plants as the plant owners felt it was inordinately expensive for the units to comply with tougher EU norms, cheaper alternatives and higher carbon prices. The plants together accounted for 4,630 MW — and 1,100 jobs — and will make way for more natural gas and renewable energy in the face of stricter carbon pricing by the EU, under which the per tonne price of carbon was at EUR 25 in 2019.
Notably, the decision seems to be entirely based on economics, as the country’s Ministry for Ecological Transition has so far refused to sign up to a specific date for a coal phaseout.
Meanwhile, Japan, too, may retire 100 of its old, inefficient coal plants by 2030 as part of its Paris Agreement commitment to cut emissions by 26% over 2013 levels by the end of this decade.
CNPC vows to slash methane emissions by 50% by 2025
The China National Petroleum Corporation (CNPC) has announced that it will increase its ambition — as part of its commitment to the Oil and Gas Climate Initiative, OGCI — and slash its methane emissions by 50% by 2025. CNPC is China’s largest oil and gas producer and its efforts will include minimising flaring at oil fields and plugging methane leaks, as 40% of the country’s methane emissions come from upstream oil and gas and coal operations. The move is significant as in 2014, China’s methane emissions were recorded at 1.125 billion tonnes, and methane is known to be a potent greenhouse gas whose unchecked emissions could negate CO2 emissions curbs.