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Power utilities don a green cap in India

According to reports, Power utilities across the nation are devising new and efficient ways to generate electricity in an attempt to cut India’s dependence on fossil fuels.

India’s largest power producer NTPC Ltd has chalked out a long-term technology road map up to 2032 that involves developing clean technologies such as advanced ultra-supercritical equipment, integrated gasification combined cycle (IGCC) plants and development of solid oxide fuel cell (SOFC).

Supercritical equipment having a capacity of 660 megawatts (MW) and above help in improving plant efficiencies and achieve economies of scale, besides being environment-friendly. NTPC along with Bharat Heavy Electricals Ltd and the Indira Gandhi Centre for Atomic Research is involved in setting up a 800MW prototype by 2017.

While IGCC plants convert coal into a cleaner burning fuel, which is then burned in a gas turbine combined cycle system to generate electricity, SOFC use a mixture of air and a natural gas fuel to generate electricity without any combustion at a 60% conversion rate.

“We are also improving the efficiency of our boilers and have brought it up to around 41% from 32%. This is very important because for every percentage improvement in boiler efficiency, the coal consumption and carbon dioxide emissions come down by 2.5%,” said Arup Roy Choudhury, chairman and managing director of NTPC.

While companies have gone green to save costs or tap a new business, many also see it as a huge positive towards one’s brand-building exercise.

“There are primarily three issues. Sustainability of the entity combined with social and environmental responsibilities. While brand building is part of being avant garde, at the same time one needs to be environmentally responsible and survive as a commercial entity for the future. The idea is not to lose balance just for profitability,” said Anil Razdan, former power secretary.

“This is a responsible form of doing business and adds to the brand image of the corporation,” concurred Roy Choudhury.

Companies have found the exercise to be profitable by doing cost-benefit analysis at each stage to deploy the best cost-effective solution. This has resulted in enhancing operational efficiencies that has resulted in increasing profit.

“If we don’t become more efficient, there will be no sustainability for continuing with the business. Regulations are becoming very stringent. This is a business necessity and not some service to the society or the environment. The awareness of the people is increasing. This is the new business paradigm today. If utilities don’t change the way they conduct business, they will become redundant. It is a question of time. The writing is on the wall,” said R.S. Sharma, managing director of Jindal Power Ltd and a former chairman of NTPC.

NTPC claims that with deployment of efficient technologies and practices, it has avoided discharge of 30 million tonnes of carbon dioxide over the past 15 years. The utility also uses ash produced at coal-based stations for manufacturing cement, concrete, asbestos sheets, construction of road embankments, ash dyke raising, mine filling and land development. NTPC plans to have 28% of its installed generation capacity of 128,000MW by 2032 through non-fossil fuel sources and has made forays in wind and solar.

“The drivers to devise new and efficient ways vary from time to time. We are the largest wind power developer in India. Notwithstanding it, our earliest initiative was to generate power in a sustainable way that is profitable,” said CLP Power India Pvt. Ltd managing director Rajiv Mishra, the local arm of Hong Kong’s biggest power supplier.

These initiatives are testimony to India’s energy security concerns, given that the country imports 80% of its annual fuel consumption. To make matters worse, India, which is dependent on coal for power, is unable to mine enough of it, forcing utilities to import coal and look at ways to optimize its fuel usage.

The interest in developing renewable energy options was evident when companies, including Welspun Solar AP Pvt. Ltd, SunBorne Energy Services, GAIL (India) Ltd and Mahindra Solar One Pvt. Ltd, bid for projects under the Jawaharlal Nehru National Solar Mission. Projects totalling 960MW based on photovoltaic panels (490MW) and solar thermal technology (470MW) were awarded in the first phase to 50 companies as a part of India’s efforts to promote clean energy under the mission. The solar mission aims to achieve 20,000MW of on-grid solar power and 2,000MW of off-grid solar applications by 2022. Also this demand could be gauged by the fact that companies such as Bosch Solar, Fichtner, IBC Solar, Pevafersa and Gehrlicher Solar plan to engage with the Indian market.

While many industry leaders welcomed the spirit of disclosures as articulated in the Companies Bill, 2011, they are opposed to provisions that exhort companies to voluntarily disclose their contributions to improving ecology and promoting sustainable business.

“We totally agree with disclosures and believe that improved amounts of disclosure benefit everyone, but not with that X amount of money should be spent for a specific purpose,” said CLP’s Mishra. CLP is among the two significant overseas entrants in India’s power generation sector.

The Bill, which was introduced in Parliament in the winter session, was referred back to the committee to suggest further changes after the main opposition, the Bharatiya Janata Party, opposed the draft law. There has also been significant interest in wind power generation as well, aided by fiscal incentives, including tax breaks for 10 years and depreciation benefits of 80% on investment in the first year of a project’s operation, besides earning carbon credits.

While there is interest to develop renewable energy sources from conventional power generation utilities, funding of such efforts has become a concern.

Although capital investment in renewable energy sources is comparatively higher compared with conventional sources, these projects tend to save on fuel costs.

A case in point is wind power generation. It takes a capital expenditure of Rs. 4.2-4.5 crore per MW of power generated through coal-based or gas-based projects, compared with wind-based projects requiring Rs. 6-7 crore per MW.

Realizing that India needs to diversify its energy mix, the government is focusing on alternative, renewable energy options. The national action plan on climate change recommends India should generate 10% of its power production from solar, wind, hydropower and other renewable sources by 2015, and 15% by 2020.

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