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Power ministry, regulators contemplate ways to develop renewable energy

According to reports, electricity regulators and power ministry are contemplating steps to make it mandatory for conventional power project developers to set up renewable energy plants in future, while distribution firms may have to purchase more clean energy, but regulatory authorities are concerned that this may hurt loss-making utilities.

Power Minister Piyush Goyal said at a recent meeting with electricity regulators that the government wants to develop clean energy, and sought their suggestions for incentives for distribution utilities for better compliance of renewable power obligations.

“The meeting of regulators and their interaction with Goyal revolved largely around promoting renewable energy. Despite enthusiasm, regulators are concerned about the stressed distribution utilities that may not be able to comply with stringent norms for renewable power purchase due to their weak financial condition. Increasing inventory of renewable energy certificate (REC) reflects lack of willingness and ability of state run utilities to meet renewable purchase obligation (RPO). Regulators suggested that MNRE can purchase RECs by using National Clean Energy Fund and validity of wind and solar energy certificates extended by six months,” said one of the participants in the meeting held on June 27.

He added the meeting took serious note of the fact that validity of several thousand certificates, which will lapse in the next few months.

Goyal told regulators that a decision would be taken shortly for replacing all old plants with new generation units operating on super critical technology to improve fuel efficiencies. He assured fuel supply for such plants would be protected and even increased to meet the additional fuel requirements for enhanced capacities. The regulators shared an idea to make renewable generation obligation (RGO) compulsory for developers of conventional thermal power plants to commission renewable energy projects in future.

Developers can bundle tariff of both conventional and renewable power to the utilities that may not need to comply with RPO separately. The officers of MNRE, which is also headed by Goyal, suggested to amend Electricity Act to introduce RGO for generating 10 per cent renewable power on the new conventional thermal power plants.

A study presented by the Power System Operation Corporation that handles the power management functions of Power Grid Corporation showed renewable power generation has not affected the transmission system as much as variations in load and tripping of generation have disturbed the grid stability. It made a presentation before the electricity regulators from Andhra Pradesh, Gujarat, Delhi, Kerala, Madhya Pradesh, Rajasthan, Haryana, Himachal Pradesh and Chhattisgarh, among others.

The meeting chaired by Central Electricity Regulatory Commission ( CERC) chairman Girish Pradhan was also attended by joint secretaries from ministries of power and renewable energy.

The regulators noted that the cost of solar power generation is coming down in India and floor price of its certificate should be brought down from existing Rs 9.30.

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