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Renewable energy mission needs a robust grid network

According to reports, air pollution in Delhi and metropolitan cities of India has dominated much of the recent conversation in the judiciary, government and media. Half of the world’s 20 most polluted cities, according to World Health Organization, are in India and these cities are immensely contributing to climate change. On 2 October 2016, India ratified the Paris climate agreement, officially emphasizing its commitment to reduce greenhouse gas emissions. Nonetheless, just two years after embarking on the grand campaign to scale up country’s renewable energy capacity to 175 gigawatt (GW) by 2022, India is facing a serious problem.

While wind power has faced curtailment in the past in Tamil Nadu, solar energy is being curtailed for the first time, sometimes over 50% during peak generation periods. Utilities have the discretion to decline buying power in the name of stabilizing the grid or preserving the grid balance. Grid curtailment is one of the biggest operating risks for the future of the solar sector given India’s transmission capacity is already overburdened. The curtailment threat is highest in Jharkhand, where the average daytime power demand is less than 1 GW but the state has already tendered 1.2 GW of solar projects. As India aspires to lead the world in renewables, will the grid be an obstruction or a catalyst for renewable energy development?

Causes of the problem

The problem is largely a technical one. Solar and wind power are not as easy to control as traditional fossil fuel plants, so power grids need to become flexible enough to handle frequent changes in power generation. Additionally, distance is an issue. In India, six states in the western and southern regions account for 80% of all of the country’s currently installed solar capacity, but only 38% of power demand. For grid operators used to being able to turn fossil fuel plants on and off at will, these changes are easier. If new measures are not urgently put into place to accommodate variable renewable energy sources, a situation can arise where the grid operator will be unable to use solar and wind power when it becomes available.

Experience of other countries

Other countries have already dealt with this problem with varying degrees of success. Germany and the US have relatively high levels of solar and wind penetration and low curtailment rates, while China has major curtailment as the share of wind and solar in the energy mix increases. Germany achieved low curtailment rates with high renewable energy penetrations through improved grid planning and changes to the power market structure. In another case, the state of Texas implemented smaller changes to how the grid is operated and it made all the difference. For example, the Texas grid operator ERCOT shifted from 15-minute dispatch intervals on the intra-day market to 5-minute intervals, allowing for superior planning around variable wind and solar power plants. (India currently uses 15-minute dispatch intervals.)

Although China has been able to build out renewable energy capacity swiftly over the past decade, it has taken much longer to develop the transmission infrastructure and make the institutional changes required to utilize all of this new power. Grid curtailment issues continue to impact the export of power from solar projects and some provinces such as Gansu and Xinjiang (31% and 26% of curtailment respectively) have been hit severely.

Recommendations to government

How can India learn from the experience of other countries and rapidly scale up renewables without any wastage or curtailment?

1. Execution of green corridor

The variability of solar and wind energy can be mitigated to a large extent through transmission interconnections, thus, the first priority for India is to complete the transmission infrastructure through its $3.5 billion green energy corridor program so that renewable power can be transmitted where it is needed. Further transmission systems need to be built ahead of renewable energy generation as transmission projects typically take up to five years to become operational whereas solar projects become operational within 12-18 months. There are significant power surpluses in some states and power deficits in others. New investment in inter-state and intra-state transmission systems will help balance out such disparities.

2. Strengthening the national grid

Accelerating planning and completion of the power grid will enable the country to better manage power problems through efficient transmission system. The objective of “One Nation-One Grid-One Frequency” is necessary to get full utilization of the nearly 175 GW of solar and wind capacity that will be installed by 2022.

Besides the National Power Grid, transmission lines within states need to be completed and modernized. This will also enable India to take advantage of the vast amounts of solar energy available from Ladakh, a cold desert and Jaisalmer, part of the Great Indian Thar desert, to power future energy needs of heavy consumption areas.

3. Emerging role of electricity storage

Electricity storage will play an important role in reducing curtailment. Electricity storage is unique in the Indian context where more than 300 million people still have no access to power. The cost of storage is still a major barrier to mass adoption, but prices are dropping rapidly. As the price of energy storage drops, it will become an increasingly compelling complement to variable renewable energy. India stands a unique chance of leading the world in electricity storage.

To facilitate this, the government should encourage battery manufacturing under the “Make in India” programme, as import of grid-scale batteries due to their extreme weight not only leads to high transportation costs but also creates other logistical challenges. In this regard, the government can co-locate battery manufacturing with top solar regions in India, which are attractive to storage companies.

4. Creation of South Asian grid

Flexible generating resources (quick start, swift ramp-up or ramp-down) such as hydro and gas plants along with active distribution management system would go a long way to improve the stability & reliability of the grid. It may be added here that India’s neighbouring countries—Bangladesh, Myanmar, Sri Lanka, Thailand, Bhutan and Nepal have large hydro, gas & renewable resources and transmission interconnection with these countries would further deliver diversity to mitigate variability of the grid. India is already interconnected with Bhutan and Nepal, and has plans to interconnect with other countries.

In this regard, India should envisage creation of a South Asian Grid connecting Malaysia and Singapore via Thailand similar to the synchronous grid of Continental Europe. Though, the Asian super grid project linking the enhanced electric power systems of China, Japan, Korea, Mongolia and perhaps Russia has been proposed by SoftBank, this new South Asian Grid will add efforts to cultivate extensive economic and strategic relations with the nations of South Asia. India’s NITI Aayog has created a framework for public-private partnerships for transmission investment, but land acquisition and permitting are still major roadblocks for private developers hoping to complete a project on schedule. Reducing the time and cost of land acquisition will be essential to making infrastructure projects attractive to developers and unlocking the private capital needed to finance transmission lines.

High renewables and robust grid

Three events are set to transform the electricity sector in India in the next decade: 300 million people who have no access to electricity today will have sufficient power; an unprecedented GDP growth of ~8% per annum will drive the electricity consumption further; and the share of wind and solar will rise to levels of ~20% in the India’s energy mix.

A successful energy transition for India will require a robust and flexible grid infrastructure within India and with neighbouring countries.

Manoj Kohli is executive chairman, SoftBank Energy.

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