Choices to Buy : Choices to Sell ?

 

 

Choices  to  Borrow  ?  Choices  to  Lend  ?

Context :

Niti Aayog pitches for greater financial autonomy for state-owned discoms  /  Busi Standard / 04 Aug. 21

 

Extract :

In a report titled ' Turning Around the Power Distribution Sector  (  Aug 2021 )  ', Niti Aayog said the performance of state-owned discoms is also determined by the ability of the respective State Electricity Regulatory Commissions (SERC) to revise tariff frequently and adequately.

"...For a state-owned utility to succeed, there should be a clear separation between utility and state. The utility should have operational and financial autonomy." it suggested.

Noting that discoms have a monopoly in their area of functioning, the think tank suggested that delicensing distribution can introduce competition and enable retail choice for customers.

"This reform can be challenging and should be accompanied with careful market design.

The total loss is estimated to be Rs 90,000 crore in FY 2021.

" As long as the markets continue to provide low-cost power, discoms should not sign new expensive long-term thermal PPA," it opined.

According to the government think tank, discoms should use time of day (ToD) tariffs to incentivise changes in demand patterns.

"Dynamic tariffs, enabled by advanced metering and a smart grid, can reduce the discoms' power purchase costs and help manage peak loads," it said.

According to an official statement, Niti Aayog member V K Saraswat said that this report presents policymakers with a menu of reform options to put the distribution sector on the track of efficiency and profitability.

==================================================

 

MY  TAKE  :

Key recommendations of Niti Aayog are :

#    De-licensing of distribution

#    Competition among DISCOMS

#    Choice for customer ( from whom to buy power )

#    Market Design

#    No long-term PPA with THERMAL POWER plants

#    Time-of-the-Day Tariff ( ToD )

#    Dynamic Tariff

#    Advanced Metering

#    Smart Grid

 

Some of these, I have listed in my following e-mails to our Policy Makers over past 4 YEARS  :

Congratulations, Shri Vijaybhai Rupaniji, ………………………………[ 30 Dec 2020 ]

 

Extract :

 [ A ]…………Gujarat Policy :

               GROUP OWNERSHIP for Self-Consumption based on ratio of

               OWNERSHIP

               My Suggestion :

               ( source : Congratulations , Shri R K Singhji / 19  Nov 2020 ]

 

         #  Introduce “ Co-operative Farming of Solar Power / CFSP “ { call it a

             kind of “ Contract Farming “ }

            

           ( incorporate this into just released FARM LAWS to encourage setting-

           up of “ Solar Power Farmers Cooperative Society “, along the lines of

           “Dairy Farmers’  AMUL Milk Cooperative Society “)

                    

                     

                #  Under CFSP, provide 30 % Capital Cost Subsidy to companies setting

                    up large ( > 500 MW ) Solar  Farms in remote areas ( eg : desert areas

                    of Kutch – Spiti – Lahul – Ladakh etc , which have a potential to

                   generate 315 GW of Solar power )

                         

                         

          Read : https://myblogepage.blogspot.com/2018/08/from-ladakh-with-love-and-sun-shine.html

 

                  #   1 MW of ( grid ) solar will need 100,000 sq ft of solar panels ( 1 KW

                        will need 100 sq ft )

                  #   The estimated cost of 1 MW solar power plant is approx. Rs 4 - 6

                       crore.

                  #   That works out to approx. Rs 400 - 600 / sq ft of Capital cost for

                       Solar panels

                  #  Solar Farm company can “ Sell “ ownership rights of solar panels to

                      individuals in modules of 1000 sq ft, ( costing Rs 4- 6 lakh per

                     module ). These rights can be sold / transferred to any buyer, only

                     with prior permission of the Solar Farm Company concerned

                      

                #  Each module ( of 1,000 sq ft ) will generate 10 KW of power, which

                    Company will feed into a  NATIONAL GRID ( free ) .

                    

               #  Each such Co-operative Company can reserve / own by itself, 30 % of

                   Solar Panels for generating power for sale in free market   

                     

              #  My nearest DISCOM will supply me those 10 KW, free of cost ( ie:

                  deduct from my monthly usage ) .

                  Any excess over my actual consumption, to be credited to my account

              #  Depending upon my usage / need , I as an individual CO-OPERATIVE

                  OWNER , can “ buy “ any number of STANDARD MODULES, and from

                 any number of Cooperative Farming companies or other Co-op Owners

                

                  

             #  This set-up will require NATIONAL SOLAR EXCHANGE in

                 which ALL discoms will be mandated to become members

                 

      

 ================================================           

[ B ]  … Gujarat Policy :

                    DISCOMs to purchase SURPLUS ENERGY

                    My Suggestion :

                    (source : Congratulations , Shri R K Singhji / 19  Nov 2020 ]

             #    My nearest DISCOM will supply me those 10 KW, free of cost ( ie:

                   deduct from my monthly usage ) . Any excess over my actual

                   consumption, to be credited to my account

                  

==================================================

[ C ] …………….Gujarat Policy :  

                   This policy will enable any one… who want to generate electricity

                   and sell it after own consumption

                   

                   My Suggestion :

                   ( source : Not Good Enough ! / 02 Dec 2017 )

                   And I hope, it recommends amending Electricity Act whereby ,

                   Anyone can generate and SELL electricity, anytime and

                   to anyone and at any price 

                    

  ==================================================            

 [ D ]  …….  Gujarat Policy  : 

                 LEASE OF ROOFTOP / PREMISES

                 My Suggestion :

                ( source : Not Good Enough ! / 02 Dec 2017 )

                #  For reaching the target of 100 GW of Solar power generation by Nov

                    2022, we need to install 1.5 GW capacity EVERY MONTH for the

                    next 60 month ( remaining 85 GW after current installations

                    totaling 15 GW )

                  

                                                  

                #   That would require an investment of Rs 10,000 Crore per month,

                      every month for the next60  months ! ( @ One Billion dollars

                     per GW )

                     

                 

               #   Part of this investment will have to come from Roof Top

                    Solar projects, to be set up by :

                     

                       *    An Individual home-owner ( who may also want to sell surplus

                            power to a neighbour )

 

                        *   A Coop Housing Society wanting its huge unutilized terrace to

                            produce solar power, for its members

                            

                         

                       *   A Business which will install these roof-tops at its own cost and is

                           allowed to sell power to the  residents of a building

                           

====================================================

 

 [ E ]   ….. ..Gujarat Policy :

                 POWER AT LOW COST

           Currently, the industry gets power at an average cost of ₹8 per unit.

           The new policy will help bring it down to ₹4.5 per unit, savings for

            #  residential units could be in the range of ₹ 1.77 to ₹ 3.70 per unit

            #  for industrial units it will be about ₹ 2.99 to ₹ 4.31 per unit,

          and for the third party buyers it will be in  the range of ₹0.91 to ₹ 2.30

          per unit.

      

            My Suggestion :

                 ( source :   Solar Power at Rs 1 per Kwh ?  /  29 Jan 2017  )

                 In India , we are planning to add Solar Power to the tune of 100 GW

                 by 2022

                How can we make that happen? And, can we make that happen at Re

                1  per Kwh ? or less ?

                We can, if  CAPITAL COST  is  ZERO !  No interest burden !

                How ?

                It can happen if NDA government musters enough courage

                to implement what I have been suggesting for past 2 years, viz :

              

              

               *  Government declares units belonging to " Solar Power ( Panel Mfr

                  / Power Production& Distribution / Ancillary Mfr  ) " as    a "  SOS "

                  industry

                 

              

              *   Units will need to register as such with Department of Company

                  Affairs ( DIPP )

                   

               *  Units will be exempt  from paying Corporate Income Tax for 10

                   years , on whatever income they earn ( only those starting

                   operations latest by 31 March 2018 )

                  

No Godfather for Rooftop Solar ? ……………………………………………..[ 01 June 2021 ]

 

Extract :

        Dear Shri R K Singhji ( Minister for Power ) :

Ø    It is high time we stop limiting our SOLAR VISION HORIZON like a “ Frog

      in the Well “

Ø  It is time to remember that the nomenclature : Roof Top Solar “ , somehow

    ties us down to the words ROOF TOP , which is only just one of the locations

    which can be used to harness Solar Energy

Ø  Solar Energy can also be harvested at other locations on Earth, such as

   FARMS , DESERTS, LAKES, MOUNTAIN TOPS, HIGHWAYS , TRAIN TRACKS

 , etc., or even through solar panels farms in  SPACE ( low earth orbits ? )

 , beaming electricity down to Earth-based receivers ( using micro-waves ? )

Ø We must break loose  from the narrowly defined, Roof-Top Solar / Land-based Solar and latch on to the all-encompassing concept of ,

SOLAR  ENERGY  TRADING INFRASTRUCTURE  (  SETI  )

 

  A Tale of Two States …………………………………………………………………..[ 28 Oct 2020 ]

 

Extract :

MY SUGGESTION :

      Out-of-the-Box Concept :

In my building, we are 10 flat-owners. Each needs 20 KW of solar – total of

 200 KW

That would require 20,000 sq ft . But the terrace is no more than 2,000 sq ft . Not enough for all

So, I ask :

    Why do we need space in our own terrace in a Mumbai building for

    getting200 KW of Solar Power ?

  

    Why cannot we use 20,000 sq ft of space, 500 Km away from Mumbai, in

    Kutch desert ?

     

    In a nut-shell, produce solar power in Kutch desert and consume it in

    Mumbai !

   Or produce power in Ladakh and consume it in Kolkata

 

 

Dear Shri R K Singhji,

 

In the process of TRANSFORMING INDIA, we need to take, not only decisions

 which are OUT-OF-BOX , but we need to take these VERY FAST

When poverty is rampant and poor people ( 400 million ? ) are dying , either

because they have lost their  income due to pandemic or because their huts got

washed away in floods, we do not have the luxury of endless ANALYSIS of “ What

If “ type of scenarios

Sure, we will make mistakes, as we did in the IMPLEMENTATION – STAGES of our

earlier BOLD / OUT-of-BOX decisions to TRANSFORM INDIA , such as De-

Monetization / GST / E-Comm / Data Protection / CoWin platform etc

But, in each of these, we learned our lessons, did “ Course Correction “– and came out stronger

We did not allow endless analysis to produce an “ ACTION PARALYSIS “  !

I urge you to consider my above-listed suggestions for URGENT IMPLEMENTATION

 

With regards,

Hemen Parekh  /  hcp@RcruitGuru.com  /  05 Aug 2021

 

 

 

 

 

 

No Godfather for Rooftop Solar ?

 

 

 

Context :

New Net-Metering cap Risks Stalling Rooftop Solar Progress in India: IEEFA  /  22 Feb 2021

Extract :

A new regulation that excludes rooftop solar systems over 10 kilowatts (kW) from net metering will stall the adoption of larger installations in India, undermining progress towards the government’s rooftop solar target of 40 gigawatts (GW) by 2022, according to a new research note.

According to the briefing note by IEEFA and JMK, a provision in the Ministry of Power’s new rules for electricity consumers which mandates net metering for rooftop solar projects up to 10 kW and gross metering for systems with loads above 10 kW will likely make rooftop solar commercially unviable for big residential and commercial and industrial (C&I) consumers.

 “Currently, India only has around 6 GW of installed rooftop solar capacity, the majority of which has been developed by C&I consumers. So the very consumers who are driving rooftop installations in India are also the ones most likely to be deterred by the 10 kW limit on net metering,” said co-author Vibhuti Garg, Energy Economist, Lead India, at the Institute for Energy Economics and Financial Analysis (IEEFA).

“India already has a long way to go to meet its critically important 40 GW target, and if limiting net metering to 10kW makes the rooftop solar space unattractive for C&I consumers, it is unlikely that we will be able to achieve that target.”

According to the authors who analysed the net and gross metering tariffs payable across leading states. It was found that gross-metered consumers are compensated for the export of solar power to the grid at rates of Rs 2-4/kWh. However, current rooftop power purchase agreements (PPAs) signed by Tier 1 developers have tariffs in the range of Rs 3.5-4/kWh.

“Developers and corporate consumers would consider any tariff lower than the current PPA tariff unviable,” said Jyoti Gulia from JMK. “If consumers have to buy electricity from Discoms at a high tariff and at the same time the feed-in tariff they receive is low they will have no incentive to set up rooftop solar at their premises

Also, under gross metering, corporate consumers would not benefit commercially from using the power generated from their own system for self-consumption. Both C&I consumers and developers will find their payback periods will be much longer and the investment will become riskier, delaying the roll-out of this strategically important, cost-effective technology solution.”

Discoms, on the other hand, will notionally benefit from the shift to gross metering for installations with loads above 10 kW, paying less for the same amount of energy. Except those benefits will be dissipated because there will be no material new investment by C&I customers, per the authors.

The note points out that although it is up to states to implement the central government’s restriction on net metering, many are likely to do so to address the loss-making Discoms’ concerns over high-paying C&I consumers shifting to rooftop solar.  Several states have already started to implement the new regulation in different forms. The note details how West Bengal has issued amendments that allow net metering for consumers with sanctioned loads of up to 5 kW and gross metering for contract demand above 5 kW. Karnataka has also proposed a gross metering arrangement for rooftop solar projects over 10 kW capacity at a Rs 2.84/kWh tariff.

The authors have proposed a net feed-in mechanism as a “win-win” solution for all the stakeholders, explaining that it would not have a major impact on Discoms’ revenue and would still be beneficial for the consumer.

A net feed-in mechanism is very similar to net metering with the exception of tariff calculation. Under a net feed-in arrangement, rooftop solar power used for self-consumption is charged at the retail tariff, and surplus (net) energy exported to the grid after self-consumption is credited at a net feed-in tariff determined by the state.

According to Garg,  the net feed-in mechanism is a middle ground option that meets the needs of both consumers and discoms, creating a win for both, and for India. “Under the net feed-in option, the consumer pays less to the discom than they would under gross metering but the discom receives more than they would under a net metering arrangement.”

“We urge the Ministry of Power to consider the interests of all stakeholders – developers, consumers and Discoms – in resolving the challenges of the net metering restriction while also stimulating private investment to boost adoption of low cost, zero emissions distributed capacity,” she concluded.

Recently, Union micro, small and medium industries minister Nitin Gadkari had urged power minister RK Singh to reconsider a recent controversial decision to restrict net metering in solar rooftop projects.

In a letter to Singh dated February 15, Gadkari noted that while more and more micro, small and medium enterprises (MSMEs) were installing solar rooftop projects, thereby contributing to the share of clean energy in the grid, the notification might well discourage them.

“It is feared that this share will shrink in the near future, affect power generation of the nation, as it is feared that the new amendments are going to affect the savings of the small units and individuals,” Gadkari said in a letter.

===================================================

The goofed up story of Rooftop Solar  /  Business Line  /  31 May 2021

Extract :

Solar Installations :

#   Total as of Feb 2021………………… 4324  MW

#   2019-20 addition……………………….. 719  MW

#   2020-21 addition………………………. 1809  MW

Reason for recent spurt ?

As per Animesh Damani : “ Modules priced very low >  Rs 28 – 31 / Watt “

What next ?

Future of rooftop solar looks bad  because :

#    Module prices rising to Rs 35 – 37 per watt

#    Next year, a 40 % Basic Customs Duty will kick in

#   State Governments ( which own most of the utilities ) don’t like Roof Top Solar

     because it takes away their  better-paying customers.

     

#   Utilities have consistently discouraged Roof Top Solar, holding back approvals

     and disallowing Net Metering

#   The Ministry of Power made matters worse last year with its draft “ Rights of

    Consumers “ Rules, recommending the far less remunerative GROSS METERING

    instead of NET METERING

     

Any Silver Lining to this Dark Cloud ?

#  Only a fall in Storage Costs can come to the rescue of  Roof Top Solar. When “

    RTS –plus- Battery “ becomes  affordable, an RTS owner need not depend on

    the Utility to buy surplus energy, which can instead be stored in  the battery for

    later use.

    

===================================================

Dear Shri R K Singhji ( Minister for Power ) :

Ø  It is high time we stop limiting our SOLAR VISION HORIZON like a “ Frog in the Well “

Ø  It is time to remember that the nomenclature : Roof Top Solar “ , somehow ties us down to the words ROOF TOP , which is only just one of the locations which can be used to harness Solar Energy

Ø  Solar Energy can also be harvested at other locations on Earth, such as FARMS , DESERTS, LAKES, MOUNTAIN TOPS, HIGHWAYS , TRAIN TRACKS, etc., or even through solar panels farms in  SPACE ( low earth orbits ? ), beaming electricity down to Earth-based receivers ( using micro-waves ? )

Ø  We must break loose  from the narrowly defined, Roof-Top Solar / Land-based Solar and latch on to the all-encompassing concept of ,

SOLAR  ENERGY  TRADING INFRASTRUCTURE  (  SETI  )

To understand the unleashing potential of my suggestion, please refer to following earlier E Mails on the subject :

Ø  Congratulations, Shri Saurabh Patelji …………………….[ 31 Dec 2020 ]

 

Ø  Congratulations, Shri Vijaybhai Rupaniji, ……………….[ 30 Dec 2020 ]

 

Ø  Congratulations, Shri R K Singhji …………………………….[ 19 Nov 2020 ]

Ø  A Tale of Two States ………………………………………………..[ 28 Oct 2020 ]

 

With regards,

Hemen Parekh  /  hcp@RecruitGuru.com  /  02 June 2021