EQ Magazine January 2020 Edition by EQ Int'l Solar Media Group

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CONT EN T

VOLUME 12 Issue #01

Disclaimer,Limitations of Liability While every efforts has been made to ensure the high quality and accuracy of EQ international and all our authors research articles with the greatest of care and attention ,we make no warranty concerning its content,and the magazine is provided on an>> as is <<basis.EQ international contains advertising and third –party contents.EQ International is not liable for any third- party content or error,omission or inaccuracy in any advertising material ,nor is it responsible for the availability of external web sites or their contents

india Coal-fired plants may have to scale down utilisation to 35% by 2022: KPMG

32 business & finance L&T Construction Bags Significant Contracts For Various Businesses

71 rooftop & offgrid Solar Rooftop: Tapping the vast potential to meet 100 GW target

65 electric vehicle Electric Vehicle Market Seen Growing 36% Annually Till 2026

The data and information presented in this magazine is provided for informational purpose only.neither EQ INTERNATINAL ,Its affiliates,Information providers nor content providers shall have any liability for investment decisions based up on or the results obtained from the information provided. Nothing contained in this magazine should be construed as a recommendation to buy or sale any securities. The facts and opinions stated in this magazine do not constitute an offer on the part of EQ International for the sale or purchase of any securities, nor any such offer intended or implied Restriction on use The material in this magazine is protected by international copyright and trademark laws. You may not modify,copy,reproduce,republish,post,transmit,or distribute any part of the magazine in any way.you may only use material for your personall,NonCommercial use, provided you keep intact all copyright and other proprietary notices. want to use material for any non-personel,non commercial purpose,you need written permission from EQ International.

JANUARY- 2020

india

MNRE misses capacity addition targets; 175 GW by 2022 in peril: Par Panel

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business & finance

india Proposed amendments in Electricity Act not in consumers interest: AIPEF

international

energy storage

Vietnam’s golden solar years aren’t over, despite policy changes

Avaada Group’s Clean Energy Business Receives USD 15 Million Investments from Proparco

The world’s biggest electric vehicle battery makers

interview

Mr. Brijesh Prajapati

51 opinion

‘India needs tariff reforms to boost consumption of renewables’

electric vehicle Promotion of Electric Vehicles

international Tighter climate policies could erase $2.3 tln in companies value: Report

EQ NEWS Pg. 08-60 INTERVIEW Pg. 36-42 research & analysis

India needs to de-risk private sector investments, develop suitable carbon pricing instrument: PwC

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interview

Mr. Luke Lu

JANUARY- 2020

- 20 January

tion Dt. of Publica | Issue- 01 | Volume- 12

India’s Oldest &

- 25 January

Posting 2020 | Dt. of

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dia Group

Leading Solar Me

EQ Int’l Magazine is India’s Premium and Oldest Solar & Renewable Energy Magazine Since 2009 having a print run of 20,000 Copies/Monthly, Readership of 80,000. EQ’s Digital presence is unparalleled with its Magazine viewed by over 100,000+ professionals in Digital Format every month (On Browser, Tablet, SmartPhone, etc...). Its unrivaled daily e-Newsletter and most visited website <www.EQMagPro.com> has lakhs of viewers and visitors daily. We provide various Medium and Tools to get the Highest Possible Visibility which we call the 365 Days, 24*7 Visibility Solution through the 360 Degree Approach. Print, Digital, Website, e-Newsletters, Conferences, Events & Video Content.

JANUARY- 2020

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JANUARY- 2020

7Â

INDIA

Coal-fired plants may have to scale down utilisation to 35% by 2022: KPMG “Even a scenario with 130 GW of renewables instead of the planned 175 GW by 2022 could result in plant load factor (PLF) dropping to 35-40 per cent for many coal plants,” KPMG said in a recent report. “Increased penetration of renewable energy in … One of the Big Four, KPMG, has predicted that capacity utilisation for many coal-fired power plants in India will drop to 35-40% by 2022 as renewable power generation sources rise. Average capacity utilisation of coal fired power plants are around 51% at present and some plants may have to be seasonally shut or mothballed, KPMG has predicted.

“As per KPMG in India analysis, even a scenario with 130 GW of renewables instead of the planned 175 GW by 2022 could result in plant load factor (PLF) dropping to 35-40 per cent for many coal plants,” it said in a recent report. “Increased penetration of renewable energy in the electricity system will lead to duck curve effects, requiring flexible operation of conventional power plants,” it said in its report.

lexible operation of conventional coal-fired plants was for a while resisted by existing operators on the premise that cycling and stop-start operations impair asset life and reliability. According to KPMG, if the option is between mothballing the plants versus operating It is possible to typically reduce the minimum technical limits to 40% in Indian conditions.

JANUARY- 2020

“However, this would require retrofitting of plant equipment and instrumentation along with extensive changes to operating practices and human competencies to safely manage cycling operations that feature frequent start-stop and ramping up and down the plants with technical, operational and commercial modifications, the latter option is surely preferable,” the KPMG study mentioned. Flexibilised coal-fired generation’s new role will be akin to storage, having energy content available on tap for balancing grid variability when the need arises rather than its erstwhile role of being the bulwark of supply. Flexibilisation of coal plants involves retrofitting of components and modifying operational processes for increasing cycling flexibility of thermal power plants so as to achieve lower technical minimum, reduce the start-up time, increase ramp rates and enable multiple cycles of start-up and shut down of plants in a day. Going substantially below 40%, as is done in Germany where plants go down to 20-25%, would require coal quality to be improved and controlled and would also require significantly more capex. In many cases, the overall costs of retrofit may not be justified, especially for assets in the later parts of their life cycle.

Source: economictimes.indiatimes

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JANUARY- 2020

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INDIA

Plan to bring rooftop solar scheme with KfW, says Nitin Gadkari

Procter & Gamble India sets up Rs 200cr environmental sustainability fund Commenting on the initiative, P&G Indian Subcontinent MD & CEO Madhusudan Gopalan said environmental sustainability is a key pillar of the company’s citizenship efforts, and is embedded in its business strategy.

Commenting on the initiative, P&G Indian Subcontinent MD & CEO Madhusudan Gopalan said environmental sustainability is a key pillar of the company’s citizenship efforts, and is embedded in its business strategy. “We know that solving the biggest challenges requires collaboration that enables people, planet and businesses to thrive,” he added. India is a priority market for the company and continues to be at the forefront of innovation, Gopalan said.

ast year, the company had set up ‘Innovation Sourcing Fund’ through which it has already invested more than Rs 200 crore on implementing innovative solutions in collaboration with external partners from across the country.

Source: PTI

The government is working with German financing institution KfW to bring a rooftop solar scheme that will bring down the cost of the power generated to Rs 2.5 per unit, Union minister of micro, small and medium enterprise (MSME) Nitin Gadkari said.

adkari said the government is working to bring down the cost of power, logistics and capital which will help reduce cost of production in India. “We are trying to reduce power cost. We are bringing a rooftop solar scheme with KfW, with the help of which the cost of power will be Rs 2.5 per unit at maximum,” Gadkari said at a FICCI Summit on MSME ecosystem here. “If we want to be competitive in the international market, we need to reduce capital, logistics and power costs.The industry must come forward to help achieve this,” Gadkari said. Source : FICCI Summit

Cheaper loans likely for discoms to clear green energy dues: Report The loans would be sanctioned to states at cost plus a nominal fee to clear dues worth Rs 67,237 crore owed to gencos till August-end. The Centre may tie up concessional loans from Power Finance Corporation (PFC), Rural Electrification Corporation (REC) and Indian Renewable Energy Development Agency (IREDA) for state governments as it looks to set the house in order in the clean energy sector, according to a report in Mint.

he loans would be sanctioned to states at cost plus a nominal fee to clear dues worth Rs 67,237 crore owed to power generation companies (gencos) till August-end. Moneycontrol could not independently verify the report. To receive loans, states need to give an undertaking that future payments to renewable energy (RE) generators would be on time. The amounts sanctioned would have to be strictly used for payments to RE generators on a first in first out basis, the report said. States will also be required to either offer a sovereign or escrow guarantee or increase revenue streams to the lender. These measures have been placed to mitigate nonperforming assets (NPAs), it quoted a senior government official. Solar and wind power tariffs are at all-time lows. Banks suspect the projects’ viabilities suspect and are wary of lending to the sector. Dues in some cases date back to two to 15 months.

Source: moneycontrol

JANUARY- 2020

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INDIA

India asks state-run firms to clear over $1 bn, owed to green energy firms: Sources The companies owe solar and wind power generators including Goldman Sachs-backed ReNew Power and Softbank-backed SB Energy over 97 billion rupees ($1.35 billion), according to the Central Electricity Authority, an arm of the federal power ministry… India has asked state lenders to provide over $1 billion to government power distribution companies to clear longstanding debts to green energy firms that could hinder further investment, three sources familiar with the plan said.

he companies owe solar and wind power generators including Goldman Sachsbacked ReNew Power and Softbank-backed SB Energy over 97 billion rupees ($1.35 billion), according to the Central Electricity Authority, an arm of the federal power ministry. Adding to the problems of the power generators, a new government in Andhra Pradesh state – which owes renewable energy firms more than any other state – wants to renegotiate its contracts, saying the prices it pays are inflated. The New Delhi government has asked state lenders Power Finance Corp Ltd, REC Ltd and IREDA to extend short-term securitised loans to the distribution firms at preferential rates, two sources in government and one in industry said.

Commercial banks are unwilling to lend to these firms because of their high outstanding debt. The government wants to ease cashflow constraints and reassure wary investors that new projects are safe to participate in, one of the sources said. “It is meant to show our intent to secure developers’ revenues,” the source said. Foreign investment is central to India’s green energy ambitions, and a slowdown in overseas funding could hurt Prime Minister Narendra Modi’s commitment to increase adoption of renewable energy. India is looking to install 175 gigawatt (GW) in renewable energy capacity by 2022, solar and wind power generators say. Japan’s SoftBank Group Corp has plans to invest up to $100 billion in solar power generation in India. Andhra Pradesh, which accounts for about a 10th of India’s renewable energy capacity, owes green energy generators 25.1 billion rupees ($353 million), over a fourth of all dues. Source: reuters

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JANUARY- 2020

INDIA

Multiple steps taken to check cyber threats faced by national power grid: R K Singh R K Singh was replying to a question on whether a large number of assets of national power grid could be vulnerable to cyber attacks and what steps the government has taken to increase security across power grid in country The government said multiple steps have been taken to enhance security and check cyber threats faced by national power grid. Minister of State for Power, New and Renewable Energy R K Singh told the Rajya Sabha that national power grid comprises a large number of assets established across the country and interconnectedness is a key feature of networked world and cyber opportunity and threat are part of it.

For curbing the cyber threats over national power grid, multiple steps have been taken. For securing transmission assets of power grid, communication from equipment of substations to control centres are done over dedicated optical fibre network owned by POWERGRID without any connectivity to external networks, he said. Singh was replying to a question on whether a large number of assets of national power grid could be vulnerable to cyber attacks and what steps the government has taken to increase security across power grid in country. The minister said these assets are further protected through multiple firewalls and systems, he said, are kept isolated from office networks to prevent any malicious online attack because of internet activity.

Also, the Ministry of Power has formed sectoral CERT-transmission housed in Powergrid which works in close coordination with Indian computer emergency response team (CERT-In), National Critical Information Infrastructure Protection Centre (NCIIP), Ministry of Home Affairs and Ministry of Electronics and Information Technology (MeitY), procedures for protected systems, alerts and advisories, regular cyber audit, crisis management plan, mock drills and exercises, the minister said.

Source: PTI

Real-time power market likely to be reality by Apr 1: CERC Chairman

Real-time power market is expected to kick in from April 1 next year, following which consumers including discoms or captive users can buy power at exchanges just one hour before delivery, said a senior official. At present, the consumers including discoms or captive users can buy power one day prior in Day Ahead Market (DAM) at power exchanges where trading is done for two hours daily from 10 am to 12 noon. “We are hoping that real-time power market will kick in from April 1, 2020. The hearing (of stakeholders) on the draft regulation on real-time power market is complete,” Central Electricity Regulatory Authority Commission (CERC) Chairman P K Pujari told reporters on the sidelines of the 22nd India Power Forum 2019 here. Pujari further said “it is not that real-time power market will kick in immediately after the finalisation or approval of the regulation by the CERC. In order to bring it, we have to put a system in place. So we have to give time. There is need for a software (trading solution) for that and people need to be educated about that.” The main purpose of introducing real-time power market is to deal with the renewables interference and better portfolio management by discoms, gencos and other consumers. With more and more renewable energy capacity being added to power grid, there would be need for sudden ramp up and down sizing of supply.

onsumers including discoms can plan their energy supplies in a better way and gencos would be able to increase or decrease their output accordingly. A senior Indian Energy Exchange official told that under the proposed draft regulation, there would be 48 session of half an hour each in a day. That means the trading of electricity would be done round the clock.

JANUARY- 2020

The official further said that after the closing of hour-an-hour session, the power delivery can be scheduled at an interval of one hour. Thus, if a consumer buys power in a session between 1:30 pm to 2 pm then the power supply can be scheduled as early as 3 pm the same day. Source: PTI

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INDIA

UP govt introduces blockchain to allow trading of surplus solar power

State power utilities UPPCL and UPNEDA have launched an ambitious pilot in select government buildings in Lucknow that have installed rooftop solar power plants. The Uttar Pradesh government has introduced the blockchain technology to the rooftop solar power segment, allowing consumers to trade their surplus solar energy.

wo state power utilities — UP Power Corporation Limited (UPPCL) and UP New and Renewable Energy Development Agency (UPNEDA) — have launched the ambitious project as a pilot in select government buildings in Lucknow with installed rooftop solar power plants. According to state energy watchdog UP Electricity Regulatory Commission (UPERC), Phase-I of the pilot project is expected to be completed in six months. The pilot project drafted by UPPCL and UPNEDA will demonstrate the technical feasibility of peer-to-peer energy trade between rooftop solar photovoltaic (PV) ‘prosumers’ using the modern blockchain technology. Power consumers who also produce electricity through rooftop solar PV system are referred to as ‘prosumers’.

They are being assisted by India Smart Grid Forum, a public private partnership (PPP) initiative of the Union power ministry, and Power Ledger, a global leader and provider of blockchain-enabled energy trading platform. The UPERC, during a hearing of the petition filed jointly by UPPCL and UPNEDA, had recently approved the pilot. Meanwhile, the Commission has directed UPPCL and UPNEDA to submit a detailed report on the outcome of the pilot, to fine-tune the contour of regulations and trading rules accordingly, and then replicate it at a broader scale in the state. Earlier, UPERC, with a view to promoting innovations and peer-topeer energy transactions/trade using blockchain, had notified the UPERC (Rooftop Solar PV Grid Interactive systems Gross/ Net metering) Regulations, 2019, in January 2019. In fact, UPERC claims to have pioneered in the field of such innovative regulations in India. Source: business-standard

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JANUARY- 2020

INDIA

State departments key defaulters on electricity bills The state government departments together owed about Rs 41,000 crore to the discoms. This is one of the reasons other than theft and systemic inefficiency for the poor financial health of distribution companies State government departments and agencies are among the key electricity bill defaulters adding to the woes of the distribution companies or discoms.

The state government departments together owed about Rs 41,000 crore to the discoms. This is one of the reasons other than theft and systemic inefficiency for the poor financial health of distribution companies. Replying to a question from Congress MP B.K. Hariprasad in the Rajya Sabha, Power Minister R.K. Singh said that the total dues/outstanding against state government departments stood at Rs 41,000 crore while the loss of discoms in FY19 was Rs 27,000 crore. Listing out reasons for the losses of discoms, the minister said that theft was one of the key issues.

“The reasons for the losses can be broadly categorised into three. One, of course, is theft. The second is inefficiency in billing and collections by the distribution companies. So, a large number of connections are not metered,” Singh said. He further said that where they are metered, a large number of meter readings do not happen. And where meter readings happen, the collection does not happen and if collection does not happen, disconnections don’t take place. “So that is inefficiency of discoms. One is theft, the second is inefficiency. The third reason is government departments do not pay,” he added. Source : IANS

Cheaper loans likely for discoms to clear green energy dues : Report

The loans would be sanctioned to states at cost plus a nominal fee to clear dues worth Rs 67,237 crore owed to gencos till August-end. The Centre may tie up concessional loans from Power Finance Corporation (PFC), Rural Electrification Corporation (REC) and Indian Renewable Energy Development Agency (IREDA) for state governments as it looks to set the house in order in the clean energy sector, according to a report in Mint.

T 14

he loans would be sanctioned to states at cost plus a nominal fee to clear dues worth Rs 67,237 crore owed to power generation companies (gencos) till August-end. Moneycontrol could not independently verify the report. To receive loans, states need to give an undertaking that future payments to renewable energy (RE) generators would be on time. The amounts sanctioned would have to be strictly used for payments to RE generators on a first in first out basis, the report said. States will also be required to either offer a sovereign or escrow guarantee or increase revenue streams to the lender. These measures have been placed to mitigate non-performing assets (NPAs), it quoted a senior government official. Solar and wind power tariffs are at all-time lows. Banks suspect the projects’ viabilities suspect and are wary of lending to the sector. Dues in some cases date back to two to 15 months.

JANUARY- 2020

Source: moneycontrol

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JANUARY- 2020

15Â

INDIA

Two arrested in criminal misappropriation case of over Rs 4 crores from Ministry of New and Renewable Energy The officials of Economic Offence Wing have arrested two people in alleged connection with a case of criminal misappropriation of Rs 4.10 crore from the Ministry of New and Renewable Energy. A complaint was filed against Pragat Akshay Urja Limited, which had set up a Special Purpose Vehicle (SPV) in the name of Sai Guru Solar Private Limited for development of 500 MW solar park at Sakri, Dhule, Maharashtra.

16Â

he Ministry of New and Renewable Energy on request from Government of Maharashtra accorded principle approval for setting up of one 500 MW Solar Park in Maharashtra on September 29, 2015. After due process, as per administrative guidelines of solar park scheme Central Financial Assistance (CFA) of Rs 25 lakhs was released to Solar Energy Corporation of India (SECI) towards the preparation of Detailed Project Report (DPR) for further release to the SPPD, read a statement. Accordingly, Rs 25 lakhs was disbursed to SPPD through MEDA and Rs 4.10 crore was also disbursed to SPPD towards administrative approvals on December 2, 2016. The Ministry of New and Renewable Energy through proper channel disbursed Rs 4.35 crore to Sai Guru Solar Private Limited for the project. The company had to complete the project within 18 months, but it did not complete it. Even the alleged company did not purchase the 50 per cent of the required land till date. It also did not return the amount despite various reminders by the Ministry. The company cheated Rs 4.10 crore given for the acquisition of land and for development of Solar Park. Accordingly, an FIR dated October 11, 2019, was filed under Sections 409/120B of the Indian Penal Code (IPC) at EOW, Mandir Marg and investigation was taken up.

JANUARY- 2020

During the investigation, it was found that the Ministry had disbursed Rs 25 lakhs for DPR and Rs 4.10 crore to the account of the alleged company of Sai Guru Mega Solar Park Pvt Ltd as a grant/subsidy for the development of one 500 MW Solar Park in Maharashtra. The accused person used the majority part of subsidy amount to repay the outstanding of loan availed by the main company Pragat Akshay Urja Ltd and remaining amount were also diverted into account of Pragat Akshay Urja and its directorsâ&#x20AC;&#x2122; account/interest but the same was provided to them for the purpose of development of the said project. During the investigation, it was also found that the implementing agency Sai Guru Mega Solar Park Pvt Ltd and Pragat Akshay Urja Ltd did not use the CFA/subsidy as per the scheme and misappropriated the entrusted amount for their personal use. After carrying out the investigation of the case, a team was constituted to search the accused persons at Indore. Police officials conducted searches at various places in Indore and finally nabbed both accused. Efforts are on to the arrest of the third accused who is absconding.

Source : business-standard

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JANUARY- 2020

17Â

INDIA

MNRE misses capacity addition targets; 175 GW by 2022 in peril: Par Panel The renewable energy ministry has continuously failed to achieve its yearly targets of clean energy capacity addition, which may hamper the mission of having 175 GW of renewables by 2022, said a Parliamentary panel. The Parliamentary Standing Committee on Energy has also asked the ministry to take up the issue of ambiguity and disputes related to GST on renewable energy devices with the finance ministry at the earliest. This is the panel’s first report, which was tabled in Parliament . The committee observed “with deep concern that the ministry has continuously failed to achieve its yearly target (of renewable capacity addition). For 2016-17 and 2017-18, against the grid connected renewable energy target of 16,569 MW and 14,445 MW, the ministry could achieve 11,319.75MW and 11,876.82 MW respectively.”

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he panel was of the view that “yearon-year shortfall in achievement of targets may hamper the entire mission of achieving 175GW (of renewables) by 2022, which in turn reflects poorly upon the commitment and sincerity of the MNRE (Ministry of New and Renewable Energy).” It noted that physical achievement in respect to family type biogas plant is also not up to the mark. On the issue of GST on renewable devices, it noted that there are lot of disputes and ambiguities regarding applicable rate of GST on solar power generating system. The panel is of the opinion that “this prevailing ambiguity regarding applicable rate of GST is not healthy for the renewable energy sector as renewable energy devices and spare parts have been kept in 5 per cent GST slab whereas the effective rate has come out to be about 9 per cent.” The committee thinks that such a situation will lead to increase in generation cost and pose a threat to the viability of the ongoing projects, ultimately hampering achievement of the targets. It wants the ministry to take up this matter with the Ministry of Finance on urgent basis.

JANUARY- 2020

The panel also noted that banks are reluctant to finance renewable projects as there are lot of bad loans or NPAs in power sector and at present, both conventional power sector and renewable energy sector are clubbed together for their loan basket. It also noted that about Rs 9,700 crore dues are owed by states and discoms towards renewable energy developers or generators. If the same is not paid back, many of the solar and wind project will turn into non-performing assets. The committee is of the view that the renewable energy ministry hold discussions with state governments and come up with guidelines or directives, so as to ensure timely payment from discoms to developers or generators. The panel also wants that the bank should separate loan basket and limit of renewable energy sector from that of conventional power sector. It has also recommended simplification of the process of subsidy disbursement and wide publicity of benefits of having rooftop solar projects and the incentives. It noted that India achieved 1826MW of rooftop solar capacity till October 15, 2019. India has set a target of achieving 40GW of rooftop solar power generation capacity by 2022. The panel said,”There should have been an installed rooftop solar power capacity of 16,000 MW by 2018-19…the committee is highly disappointed with the dismal performance of the ministry in this sector….give this programme a serious relook, otherwise it will derail the entire National Solar Mission.” The panel also suggested to formulate a dedicated programme to support solar manufacturing in the country. It noted that the price of solar equipment in the country is not competitive as compared to foreign manufacturers especially Chinese. About 85 per cent of the solar equipment/cells/modules are imported from China and other countries like Vietnam and Malaysia. The panel also pointed towards decrease in budgetary allocation at revised estimates stage to the ministry and low utilisation of even decreased allocation of funds. It was of the view that this reflects poor financial planning by the ministry. Source: PTI

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INDIA

Government is committed to manage renewable energy curtailment and enhance ease of doing business

Shri Anand Kumar, Secretary, Union Ministry of New & Renewable Energy (MNRE) has said that the Government is committed to managing curtailments to enhance the ease of doing business for developers in the renewable energy sector. Speaking at the session on Renewables in India at the India Pavilion, on the sidelines of Madrid Climate Conference (CoP25) at Madrid, Spain, he added that Regional Energy Management Centres (REMCs) to support the increasing share of renewable is being increased. Shri Kumar further said, “Payment Security Mechanism to de-risk investments in renewable have been put in place. On the demand side, the Ministry is working with farmers and Commercial & Industrial (C&I) consumers to embed them into the renewables value chain as direct stakeholders.”

hri Kumar also stated that the Government of India is confident of meeting its target of 175GW renewable energy capacity by 2022 and increasing it to 450GW over time. He informed that India’s current capacity is 83GW , and additional 70 GW capacity is under fruition. He stated that Ministry of New and Renewable Energy (MNRE) aims to bid out the balance capacities for solar and wind by June 2020, giving developers 30 months to complete deployment.

Shri Anand Kumar underlined the need for catalysing private investment and expand India’s clean energy market through innovative risk mitigation and aggregation instruments. He stated that the additional investments in renewable up to year 2022 would be about $80 billion at today’s prices and an investment of around $300 billion would be required upto 2030. He informed about the Indian Renewable Energy Development Agency (IREDA) ‘s ‘green window’ initiative to attract private capital to the under-served segments of the market. Top contenders for the green window include storage, electric mobility, distributed renewables and energy efficiency. He also informed that IREDA is launching its own Alternate Investment Fund to recycle its capital by attracting insurance, pension funds etc., with the aim to deepen the bond market, and in turn, allow the projects to directly link with public funds. He detailed the Pradhan Mantri Kisan Urja Suraksha evem Utthan. Mahabhiyan (PM- KUSUM) Scheme for farmers to install solar pumps and grid connected renewable power plants, targeting 26GW capacity and 1.7 million farmers by 2022. KUSUM aims to provide a stable, continuous and long-term source of income to rural landowners; advantages include decentralised local clean power for rural load centres and agriculture pump-sets, enabling energy access without adding grid load; reduced transmission losses; less use of expensive and polluting diesel-powered pumps, and a reliable source of irrigation.

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Shri Manu Srivastava, Principal Secretary, New and Renewable Energy Dept, Government of Madhya Pradesh, said that to maintain investor confidence in India’s renewables sector, “we need to make the projects bankable and viable, resolve the uncertainties the projects may have in terms of their bidders and bankers, keep processes transparent, and create ownership among all stakeholders.

Mr Juan Carlos Olmedo, President, Board of Directors, Coordinador Eléctrico Nacional, Chile asserted that in the increasingly interconnected world, India’s vision of ‘One Sun, One World, One Grid’ holds special meaning, as countries such as Chile, which are rich in renewables, will now get the opportunity to enter the global energy market. Experts from IRENA, the International Energy Agency, German development bank KfW, the Natural Resources Defense Council and the India Smart Grid Forum, emphasised the importance of flexibility in policy, financing, manufacturing, pricing, technology, storage and services in rapidly scaling up renewables. Global energy major Acciona outlined solutions to decarbonise electrical systems, while Indian conglomerate Dalmia Bharat Cement noted that clean energy systems must become integral to the business strategies of large corporates as well as their supply networks to remain competitive amidst the ongoing energy transition.

Source: PIB

JANUARY- 2020

INDIA

Discoms’ dues to power producers rise by 45% to Rs 81,000 crore The dues include those to independent power producers (about 30% of the total) and state-run utilities such as NTPC, DVC and NHPC. State-run electricity distribution companies’ (discoms) dues to power producers stood at Rs 80,930 crore at the end of November 2019, up 45% from a year earlier. About 89% of these (Rs 71,673 crore) were “over-dues” with payment default of 60 days or more.

he dues include those to independent power producers (about 30% of the total) and state-run utilities such as NTPC, DVC and NHPC. The discoms’ dues to power producers have been rising relentlessly over the past two years and this could’ve also had made them cut purchases, a trend which has reflected on the use of generation capacity (PLF) as well as power consumption pattern, both of which have been sliding. The trend of rising dues to power plants continues despite the Union power ministry implementing the letter of credit (LC) mechanism since August 2019 to compel discoms to become more disciplined in meeting payment obligations.

Discoms’ over-dues to power plants have increased 73% annually at November end. Clearly, most state-run discoms aren’t complying with the mechanism that mandates them to offer LCs to producers as payment security. While Rajasthan alone accounts for about 31% of total over-dues of discoms across India, Tamil Nadu and Uttar Pradesh make up for another 16% and 18%, respectively. According to data available with the power ministry’s ‘praapti’ portal, private power producers to which discoms owed the most as over-dues at November end were RKM Powergen (Rs 3,384 crore), Adani Power (Rs 3,201.7 crore), Bajaj Lalitpur (Rs 2,213 crore), GMR Energy (Rs 1,930 crore) and Sembcorp Energy (Rs 1,408 crore). NTPC’s invoices to discoms which remain not honoured as on November 30 totalled Rs 12,352 crore. Among staterun power generators, Rajasthan Rajya Vidyut Utpadan Nigam has the highest dues from discoms of Rs 19,592 crore. Thanks partly to the Andhra Pradesh government’s decision to review the tariffs for solar and wind power projects, the country’s discoms’ over-dues to renewable power plants surged 130% y-o-y to Rs 5,867 crore. CARE Ratings recently downgraded its rating outlook for 13 solar generators supplying power to Telangana to ‘negative’. Delayed payments impair the generating companies’ ability to service debt and exhaust their working capital. This leads to lower credit ratings and higher interest rates.

Rating agency Icra recently noted that the progress on stressed thermal asset resolution is slow, with only about 10% of the stressed capacity nearly achieving resolution, another 4% resolved, and the remaining still under stress. “Overall, about 38% stressed capacity is admitted/referred to NCLT with remaining being under resolution by the lenders,” Icra said. Delaying payments to generators helps cash-strapped discoms manage their working capital cycles, meet short-term obligations and avoid costly working capital loans. Discoms’ financial losses stood at nearly Rs 28,000 crore at the end of FY19, up 88% y-o-y.

Union power minister RK Singh told FE in September last year that “the LC mechanism has already stopped the creation of new dues” and the issue of legacy dues would be addressed by one of the provisions in the upcoming tariff policy which would “make it compulsory for the discoms to pay the 18% delayed payment surcharge for pending dues”. Source: financialexpress

JANUARY- 2020

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INDIA

Power discoms faced losses worth Rs 27000 crore in FY19: Power Minister R K Singh After the meeting, Singh said, “The total loss of all power distribution companies in the financial year 2018-19 was Rs 27,000 crore. That is huge. Because of the losses, the discoms are under stress”. Panaji: Power distribution companies in the country suffered losses worth Rs 27,000 crore in 2018-19, Union Power Minister R K Singh has said.

he Centre aims to reduce electricity transmission and distribution losses in the country to 15 per cent in next two years, Singh said. He met Goa Power Minister Nilesh Cabral at the Power Grid Corporation’s facility at Colvale, located about 20 km from here. After the meeting, Singh said, “The total loss of all power distribution companies in the financial year 2018-19 was Rs 27,000 crore. That is huge. Because of the losses, the discoms are under stress.” He noted that the discoms were facing issues related to purchase of power, maintenance and others. “I have to help the discoms of all states to make them viable by reducing their losses,” he said. Listing the targets for 2020, Singh said in some states the transmission and distribution losses were very high. In addition, there were also commercial losses, related to metering, billing and bill collection.

Overall, last year the aggregate transmission and distribution loss for the entire country was 18.5 per cent. We want to bring it down to 15 per cent in next two years, the minister said. Talking about achievements of the NDA government, Singh said the power sector has a undergone huge transition. “Before our government came to power, we had a power deficit. We did not generate enough power for our requirements before 2014. There used to be load-sheddings. We have made the country surplus in power generation,” he said Singh said India was now exporting power to Bangladesh, Nepal and Myanmar. “Now, the whole country is unified into one grid…we can generate power in Kashmir and supply to Kanyakumari,” he added. Source: PTI

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CARE ratings sees higher counterparty risk from Telangana discoms CARE Ratings has maintained a negative outlook for 13 solar generators that are selling electricity to financially-stressed distribution companies (discoms) in Telangana. The aggregate installed capacity of generators that are being rated is 671 Mw.

f the total 14, CARE Ratings had downgraded the ratings of the borrowing programmes of four solar power generators that have installed capacity of 257 Mw. The rating action reflects increased counterparty risk and weakening liquidity position of these generators owing to significant delays in the receipt of payments from these discoms.

Amod Khanorkar, senior director, CARE Ratings, said, solar power generators in Telangana have been facing delays in payments by 10 months. They saw a marginal improvement compared to the last review on account of commencement of payments by Telangana. State utilities in Telangana are cash strapped and rely on state subsidies to survive. Furthermore, there is no revision in tariff for FY20. According to the tariff order for FY19, the two distribution licensees have projected a revenue deficit of Rs 9,770.98 crore for FY19. Based on the prudence check of the filings of distribution licensees, the revenue deficit for FY19 has been pegged at Rs 5,940.47 crore. The Telangana government provided a budgetary allocation of Rs 4984.30 crore on account of the subsidy for FY19. Khanorkar said, “In view of the worsening of liquidity position of these SPVs, apart from the ability to service debt in a timely manner, O&M (operation and maintenance) activities and the desired plant availability can also get impacted.” Timely collection of payments from the off-takers and maintenance or creation of debt service repayment account will remain crucial for these companies’ overall credit profile in the near term. Ratings may be downgraded if there is further delay in payments or absence of promoter support. The outlook may be revised to stable in case of a significant decline in receivable days on a sustained manner, CARE added.

Source: care

JANUARY- 2020

INDIA

Infra players pitch for captive renewable energy policy, exemption from cross subsidy charges The infrastructure companies raised these issues during a pre-budget consultation with Finance Minister Nirmala Sitharaman and top officials from finance, new & renewable, road transport and environment ministries.

nfrastructure sector urged the government to bring captive renewable policy and exempt from cross subsidy and transmission charges to make renewable energy more viable for those willing to set up clean energy plants beyond factory boundaries. The infrastructure companies raised these issues during a pre-budget consultation with Finance Minister Nirmala Sitharaman and top officials from finance, new & renewable, road transport and environment ministries.They also asked to make finance available for real estate and affordable housing to boost consumption of cement and other inputs like steel. Besides, they were of the view that government should release stuck up funds meant for infrastructure sectors as soon as possible for bringing in buoyancy in the economy.

We asked government to see, how can finance be made available for real estate and affordable housing. We also asked to release funds withheld at different levels in the government. Cement and other Core infrastructure sector can do a lot of work toward renewable energy. But the deterrents are cross subsidy and transmission charges. These two charges made renewable energy even more expensive than thermal power, Dalmia Bharat Cement MD & CEO Mahendra Singhi said after the meeting.

JANUARY- 2020

The infrastructure players have asked the government to bring captive renewable energy policy and give exemption from cross subsidy and transmission charges for clean energy plants beyond factory boundaries, he added. Infrastructure sector players, particularly cement, claimed that they can also set up 12GW to 15GW of renewable energy projects and there is positive mood on this in the country. The cross subsidy charges ranging from Rs 1.5 to Rs 2 per unit and transmission charges are to the tune of 50 paisa per unit. These add Rs 2.5 per unit to the cost of clean energy, which comes around Rs 3.5 per unit. That make renewable energy cost Rs 6 per unit, which is even higher than thermal power cost in most of the cases. On the tax issues, he said that there was no discussion in the meeting. Cement sector is paying GST (Good & Service Tax) at the rate of 28 per cent and contributing around Rs 40,000 crore annually to the exchequer. They also informed the minister that how can infrastructure sectors can play a role in dealing with plastic and municipal waste or bio mass. “Government is positive about it. Lets see what best comes out (budget),” he added. The main areas of discussion during the meeting included issues relating to challenges in the infrastructure sector vis-a-vis framing of trade rules and policies in global context, quality of resilience of infrastructure sector and related finance, railway infrastructure, enhanced focus on adapting renewable energy for economy and environment, and climate resilient infrastructure development among others, the finance ministry said in a statement. The stakeholders of infrastructure sector and experts of energy sector and climate change gave a wide range of suggestions in the meeting including availability of finance for real estate, infrastructure and affordable housing; renewable energy sector to have larger capacity creation, further fine-tuning in IT Act and lower duties and softer lending rates. They also suggested on automotive industry’s role in fighting climate change through support for electric mobility, scrapping policy for old polluting vehicles and focus on mass transport powered by renewable energy; attention on taxonomy on green economic activities/ climate finance; climate compliant investment and more funds for combating air pollution and increasing efficiency of resources. They also called for promoting energy efficiency in SME sector via government support to cluster based intermediaries and faster phasing out of depreciated coal fired power plants. The suggestions also include push to bio-fertiliser; viability gap funding for batteries to encourage renewable energy power storage, expansion of existing Kisan Urja Suraksha evam Utthaan Mahabhiyan (KUSUM), promotion of energy efficient appliances including LPG Cooking stoves and bringing technology for improving Railway infrastructure. Source: PTI

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INDIA

Proposed amendments in Electricity Act not in consumers interest: AIPEF The All India Power Engineers Federation (AIPEF) said most of the amendments proposed in the Electricity Act 2003 and National Tariff Policy are against the interests of the common consumers.

Stating this in a statement here, AIPEF Spokesperson V K Gupta said the worst part is the introduction of supply licenses who will only meter and supply power to the consumer from the nearby pole or transformer. He said power engineers will resort to a one-day work boycott on January eight against the proposed amendment in Electricity Act 2003 to facilitate the privatization of power distribution.

tate Discoms will maintain the power distribution network and the private company will earn heavy profits without any investment from high-end consumers and the universal supply obligation of subsidized consumers will be left with the State Discoms.

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Under the new tariff policy, he said, the private company will charge the full amount with guaranteed profits from the consumers thus raising the bill of the consumers. Under this policy subsidy and cross-subsidy will be phased out in a period of three years. At present BPL, farmers and other categories of consumers get subsidized power and the difference in supply cost is borne by industrial and other high-end consumers. With the abolition of this cross-subsidy, the power will become costly for common consumers, he added. The proposal for installing smart meters is an exercise of a big scandal, he said and added that even today normal meters are working around the many developed countries without any problem. Mr Gupta said the role of state regulatory commission will be reduced as they will be forced to follow national tariff policy. As electricity is a concurrent subject this is a direct attack on the rights of the states. From the Discoms point of view, computerized energy accounting and metering will be the biggest hurdle. In a technologically advanced country like the United Kingdom, it took a decade to streamline the process.

Source: UNI

JANUARY- 2020

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Featured

Renewable Energy Sector Makes rapid Strides in 2019 As a part of Nationally Determined Contributions as per the Paris Accord on Climate Change, India has made a pledge that by 2030, 40% of our installed power generation capacity shall be from non-fossil fuel sources and also by 2030, reduce emission intensity of GDP by 33-35 % from 2005 level. Economic growth, increasing prosperity, a growing rate of urbanisation and rising per capita energy consumption has increased the energy demand of the country.

eeping in view the above and our commitment for a healthy planet with less carbon intensive economy, we decided in 2015 that 175 GW of renewable energy capacity will be installed by the year 2022. This includes 100 GW from solar, 60 GW from wind, 10 GW from biomass and 5 GW from small hydro power.The substantial higher capacity target will ensure greater energy security, improved energy access and enhanced employment opportunities. With the accomplishment of these ambitious targets, India will become one of the largest Green Energy producers in the world, even surpassing several developed countries.

The Prime Minister in his address atto Climate Action Summit stated that “India’s renewable energy capacity would be increased to much beyond 175 GW, and later till 450 GW”.In line with the objective of expanding renewable energy sector, several important initiatives were taken during year 2019. Renewable Energy capacity is rising rapidly and the status of projects as on 17.12.19 is given below: SECTOR

INSTALLED CAPACITY (GW)

UNDER IMPLEMENTATION (GW)

TENDERED (GW)

TOTAL INSTALLED/ PIPELINE (GW)

Solar Power

32.53

25.05

25.78

83.36

Wind Power

37.28

9.64

2.20

49.12

Bio Energy

9.94

0.00

9.94

Small Hydro

4.65

0.55

0.00

5.20

Wind Solar Hybrid

1.44

0.00

1.44

Round the Clock (RTC) Power

0.00

1.60

Total

84.40

36.68

29.58

150.66

JANUARY- 2020

MAJOR INITIATIVES UNDERTAKEN DURING THE YEAR 2019

Kisan Urja Suraksha evam Utthaan Mahabhiyan (PM-KUSUM) In a major initiative towards making Annadata also a Urjadata PM-KUSUM scheme was approved on 8th March 2019 and implementation guidelines were issued on 22.7.2019. State-wise allocation of capacities for the first year was made on 13.8.2019. The scheme covers grid-connected RE power plants (0.5 – 2 MW)/ Solar water pumps/ grid connected agriculture pumps and has following three components: Component A: Installation of 10,000 MW of Decentralized Ground Mounted Grid Connected Renewable Energy Power Plants by farmers of 500 kW to 2 MW capacity within 5 km distance from sub-station primarily on barren/uncultivable land. The DISCOMs will purchase power at pre-fixed tariff for which they will get PBI of Rs. 0.40 per unit up to Rs. 33 lakh per MW in a span of five years. Component B: Installation of 17.50 lakh standalone Solar Powered Agriculture Pumps for which Government of India will provide financial support up to 30% of the cost of solar pump and States to also provide at least 30% of the cost of solar pump, balance cost to be shared by the beneficiary farmer. (For NE and hilly States/UTs the Central support would be up to 50% of the cost of solar pump) Component C: Solarisation of 10 Lakh existing Gridconnected Agriculture Pumps for which Government of India will provide financial support up to 30% of the cost of solarisation and States to also provide at least 30% of the cost of solarisation, balance cost to be shared by the beneficiary farmer. (For NE and hilly States/UTs the Central support would be up to 50% of the cost of solarisation) Targets: Setting up of 25,750 MW additional solar capacity by 2022. Implementing framework: Scheme will be implemented by agencies designated by States for the three components in the respective states as per implementation guidelines issued by MNRE. Centralised tendering envisaged for Component-B. Centralised tendering for 1.75 lakh solar pumps ComponentB completed by EESL (Energy Efficiency Services Ltd.) and States started implementations of Component-B. For Component-A and C the States have to initiate process as per Guidelines.

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featured Standard bidding guidelines

Grid-Connected Rooftop Solar (RTS) Programme

The Ministry has issued Guidelines for Tariff Based Competitive Bidding Process for Procurement of Power from Grid Connected Solar & Wind Power Projects with an objective to provide a framework for procurement of solar & wind power through a transparent process of bidding including standardisation of the process and defining of roles and responsibilities of various stakeholders. In order to strengthen the contractual provision in the Contract (Power Purchase Agreement) between the solar power generators and the Procurers, and to facilitate setting up of solar power projects, the Government, vide notification dated 22.10.2019 from Ministry of New & Renewable Energy, has made following major amendments to the ‘Guidelines for Tariff Based Competitive Bidding Process for Procurement of Power from Grid Connected Solar PV Power Projects:

(i). Solar Power Generators have been allowed to submit documents/Lease Agreement to establish possession/right to use 100% (hundred per cent) of the required land in the name of the Solar Power Generator for a period not less than the complete term of the PPA, on or before the Scheduled Commissioning Date (SCD). (ii). Clear and elaborate provisions for time extension and compensation to affected party in the event of natural and non-Natural Force Majeure events with specific provisions regarding termination due to natural and nonnatural Force Majeure events have been included. (iii). Quantum of Compensation for back-down has been increased from 50 % to 100% with provision for recognition of only written instructions of back-down and payment of back-down compensation. (iv). Corresponding Time Extension in date for achievement of financial closure and scheduled commissioning date, in case there is a delay in adoption of tariff by the concerned Electricity Regulatory Commission beyond a period of 60 days from the filing of such application. Similar relaxations were also made for wind power bidding guidelines.

Development of Ultra Mega Renewable Energy Power Parks (UMREPPs) This Ministry has undertaken a scheme to develop Ultra Mega Renewable Energy Power Parks (UMREPPs) under the existing Solar Park Scheme. The objective of the UMREPP is to provide land upfront to the project developer and facilitate transmission infrastructure for developing Renewable Energy (RE) based UMPPs with solar/wind/hybrid and also with storage system, if required. The implementing agency of the UMREPPs may be a Special Purpose Vehicle (SPV) in form of a Joint Venture Company (JVC) to be set up between Central Public Sector Undertaking (CPSU) and any State Public Sector Undertakings (SPSU) or State Utility or Agency of the State Government or a SPV fully owned by any CPSU or a SPV fully owned by any State PSU / State Utility / Agency of the State Government. NTPC, SECI, NHPC, THDC, NEEPCO, SJVNL, DVC, NLC and PFC have proposed to set up UMREPPs of around 42,000 MW in various states.

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Power Distributing companies (DISCOMs) will be the implementing agencies Subsidy/CFA will be available for the residential sector only CFA under residential category will be provided for 4000 MW capacity and the same will be provided on the basis of benchmark cost or tender cost, whichever is lower. For RTS systems up to 3 kW, CFA is 40%; for capacity above 3 kW and up to 10 kW, CFA is 40% for first 3 kW and 20% for balance quantity; for capacity above 10 kW, CFA is 40% for first 3 kW and 20% for next 7 kW. No subsidy beyond 10 kW capacity. For Group Housing Societies/Residential Welfare Associations (GHS/RWA), CFA will be limited to 20% for RTS plants for supply of power to common facilities; however, the capacity eligible for CFA for GHS/RWA will be limited to 10 kW per house with maximum total capacity up to 500 kWp. Residential Consumers/Group Housing Societies/Residential Welfare Associations have to pay only balance amount after deducting the CFA to the empanelled vendor for installation of the RTS project For availing the benefit of CFA, indigenously manufactured PV Modules and Cells are to be used. Performance based incentives will be provided to DISCOMs based on RTS capacity achieved in a financial year (i.e. 1st April to 31st March every year till the duration of the scheme) over and above the base capacity i.e. cumulative capacity achieved at the end of previous financial year. Solar PV manufacturing Government Producer Scheme for setting up Solar PV Power plants using domestically manufactured SPV cells & modules Government have approved a Scheme [CPSU Scheme PhaseII (Government Producer Scheme)] for setting up of solar PV power plants by Government Producers [Central Public Sector Undertakings (CPSUs)/ State Public Sector Undertakings (SPSUs)/ Government Organisations, etc.], as per extant Guidelines, in a World Trade Organization (WTO) compliant manner, using domestically manufactured solar PV cells and modules to encourage ‘Make in India’ in Solar PV Manufacturing sector.

JANUARY- 2020

Featured

Solar PV Manufacturing linked PPAs for Solar Power Plant Tenders for setting up Solar PV Manufacturing Capacities in India linked with assured off take in the form of PPAs for Solar Power Plant has been finalized. SECI has already concluded a bid for one such tender under which 2-3 GW of Solar PV Cells &Modules manufacturing capacity linked with 8-12 GW of Solar PV Power plants capacity is likely to come up.

Wind-Solar Hybrid The main objective of the National Wind-Solar Hybrid Policy is to provide a framework for promotion of large grid connected wind-solar PV hybrid system for optimal and efficient utilization of wind and solar resources, transmission infrastructure and land. The wind – solar PV hybrid systems will help in reducing the variability in renewable power generation and achieving better grid stability. The policy also aims to encourage new technologies, methods and way-outs involving combined operation of wind and solar PV plants. So far, SECI has awarded 1440 MW capacity of wind solar hybrid projects after e- reverse auction. In addition, Hero Future Energies has commissioned wind solar hybrid project by adding 28.8 MW of solar project to an existing 50 MW wind project (Total 78.8 MW hybrid project) in Raichur district, Karnataka.

Offshore Wind Power in India The National Offshore wind energy policy was notified in October 2015 with an objective to develop the offshore wind energy in the Indian Exclusive Economic Zone (EEZ) along the Indian coastline of 7600 km. eight zones are identified each in Gujarat and Tamil Nadu having cumulative offshore wind energy potential of 70 GW. Expression of Interest for first 1 GW offshore wind project was floated in April, 2018. More than 35 participants from in country onshore wind developer / manufacturer as well as international offshore wind developers had participated. The inputs received from the participants have been duly considered in designing the bid documents.

Inter State Transmission System (ISTS) Phase-II (66.5 GW REZ) Potential renewable energy zones (66.5 GW – Solar 50 GW and Wind 16.5 GW) have been identified in the states of Tamil Nadu, Andhra Pradesh, Karnataka, Gujarat, Maharashtra, Rajasthan & Madhya Pradesh and a comprehensive transmission scheme was evolved integrating these renewable energy zones. The scheme is being implemented in phases by way of either Tariff Based Competitive Bidding (TBCB) or through Regulated Tariff Mechanism (RTM) by PGCIL. The TBCB bids are being carried out by PFC and REC. The allotment of works in TBCB or RTM is done by established committees of transmission constituted by Ministry of Power. Of this, Phase-I projects (for evacuation of 12.4 GW) have been bid out, awarded and are under implementation. Phase-II projects (for evacuation of approx. 15 GW) have been allotted by Ministry of Power in October/November 2019 and the bids have been issued by PGCIL/PFC. The Phase-III (approx. 39 GW) projects are under approval of the National Committee on Transmission.

Payment Comfort Opening of LCs by all DISCOMs/ distribution licensees for all producers Ministry of Power has issued an order regarding opening and maintaining of adequate Letter of Credit (LC) as Payment

JANUARY- 2020

Security Mechanism (PSM) under Power Purchase Agreements (PPAs) by Distribution Licensees (DISCOMs). Further, Ministry of Power has instructed Power System Operation Corporation Ltd. (POSOCO) that according to the Procedure for Scheduling of power to Distribution Company, Power will be scheduled for dispatch only after a written intimation is given to the appropriate Load Despatch Centre (LDC) i.e. NLDC/RLDC/SLDC that Letter of Credit (LC) for the desired quantum of power w.r.t the generating stations has been opened. Term loans to DISCOMs for clearing outstanding payments of RE generators Ministry has requested PFC/REC/IREDA to extend short term loan to DISCOMs for the purpose of making payments to renewable energy generators.

Energy Storage

SECI have floated two tenders which include battery storage systems: – A. 1200 MW tender with requirement of supplying power during evening/morning (six hours) peak, with battery storage system. B. 400 MW round the clock renewable, this will also come with battery storage system.

Second Assembly of the International Solar Alliance (ISA) The Ministry hosted the second assembly of International Solar Alliance (ISA) on 30th and 31st October 2019 New Delhi. On 30th October 2019, coordination and consultation meetings on different aspects of ISA programmes and initiatives were held. The Assembly met on 31st October 2019 & was presided by Shri R.K. Singh, Hon’ble Minister & ex-Officio President of ISA. Delegations from 78 countries participated in the Assembly including 29 Ministerial delegations of which 25 are from ISA member countries, two from signatory countries, and two from prospective member countries. The Assembly deliberated upon ISA’s activities and new proposals for accelerating development and deployment of solar energy in ISA member countries and approved Rules and Procedure of the Assembly, Manual of Regulations of ISA, and Work Programme and Budget for the year 2020.

Global Solar Event for commemorating 150thbirth anniversary of Mahatma Gandhi Ministry in association with IIT Bombay organised Global Student Solar Assembly to commemorate 150th Birth Anniversary of Mahatma Gandhi and to promote the Gandhian idea of sustainable living. Over 6,800 students from National Capital Region created Guinnes world record by lighting the largest number of solar lamps together at Indira Gandhi Stadium Complex, New Delhi. Another Guinness World Records was made during this event on sustainability lessons to the largest number of participants at a single place.

Dispute Resolution Mechanism During the period MNRE set up a Dispute Resolution Mechanism for wind/solar projects to consider the unforeseen

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featured disputes between solar/wind power developers and SECI/ NTPC, beyond contractual agreement. This mechanism will help in smooth implementation of solar/wind energy projects in India, by expeditiously resolving, unforeseen disputes that may arise beyond the scope of Contractual Agreements.

Off-Grid Solar PV Applications Programme Phase III Government is implementing Phase-3 of the Off-Grid Solar PV Applications Programme for Solar Street Lights, Solar Study Lamps and Solar Power Packs. Based on the demand for solar street lights and solar study lamps sanction has been issued to States; EESL has completed centralised tendering for solar street lights and solar study lamps. Provision has been made for financial supportup to 90% of the benchmark cost of the system for NE States, Hilly States/UTs and Island UTs; up to 30% of the benchmark cost of the system for other States. Solar study lamps for students will be provided in NE States and LWE affected areas with 85% financial support from Central Government. Targets: 118 MW of off-grid solar power systems during 2018-20. Implementing framework: Projects will be implemented by State Nodal Agencies in their respective States. Centralised tendering will be done for solar streetlights and solar study lamps.

Atal Jyoti Yojana (AJAY) Phase-II Applications covered: Solar Street Lights.

Targets: A total of 3,04,500 Solar Street Lights (SSLs) will be installed in the following states/ regions: States of Uttar Pradesh, Bihar, Jharkhand, Odisha and Assam, which were covered in Phase-I of the Scheme as there is additional demand in these States. Hilly States/UTs of Jammu & Kashmir, Himachal Pradesh and Uttarakhand. North Eastern States including Sikkim. Islands of Andaman & Nicobar and Lakshadweep. Parliamentary constituencies covering 48 aspirational districts of States other than those covered in (i) to (iii) above. Implementing framework: Project is proposed to be implemented by EESL. Hon’ble MPs of concerning parliamentary constituencies will provide consent letter along with location of lights. Respective DM will issue sanction for allocation of funds from MPLAD funds. Achievements: During Phase I of the Scheme, sanction for allocation of funds from MPLAD fund received for 96 parliamentary constituencies. Out of sanctioned 1.45 lakh Solar Street Lights 1.34 lakh have been installed. Current Status: Ph-II of the Scheme is under implementation. Consent letters for installation of 1,31,586 SSLs have been received from 120 Hon’ble MPs against which sanction from DMs has been received for 31,426 numbers of SSLs and 13,583 SSLS have been reported installed.

Tata Power seeks global investors through InvIT for renewable portfolio, says CEO Praveer Sinha Tata Power currently has a debt of Rs 44,000 crore ($6.1 billion) and a debt to equity ratio – a financial metric which shows how much of a company’s operations are funded by debt – of 2.2

ata Power Company Ltd, the power generation arm of the salt-to-software Tata group, wants to sell a stake in its renewable energy portfolio to global investors, its chief executive Praveer Sinha told Reuters. The company is examining the option of bringing in global investors through an infrastructure investment trust, commonly called an InvIT, Sinha said, adding the funds would help the company reduce debt.

It will be a private InvIT in the sense that there will be some global players who are long term investors, Praveer Sinha said. An InvIT is an investment scheme like a mutual fund where a sponsor can accept investments from institutional and individual investors. Tata Power currently has a debt of Rs 44,000 crore ($6.1 billion) and a debt to equity ratio – a financial metric which shows how much of a company’s operations are funded by debt – of 2.2. “We want to bring down the covenant to two,” Sinha said of the ratio.

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A final call on the InvIT plan will be taken in six months. India’s power consumption fell sharply in October and has contracted for the last three straight months amid slowing economic growth. This has not only pushed several power companies to operate plants below capacity, but also curtailed their ability to service debt. Prime Minister Narendra Modi’s government has tried to fix the economy with various fiscal measures, but economists say they are not enough to boost consumption and industrial activity. Analysts expect economic growth to come in way below 5% for the September quarter. “You have to empower people. If they have money then you can make a society a consumption society,” Sinha said. Though many of the government’s initiatives are to enhance supply, sooner or later it will come up with plans to bolster consumption as well, Sinha said. Tata Power is selling its stakes in overseas renewable and mining projects to raise up to a billion dollars over the next 18 months. This will also help reduce dent, Sinha said. Source: reuters

JANUARY- 2020

BUSINESS & FINANCE

Avaada Group’s Clean Energy Business Receives USD 15 Million Investments from Proparco

USD 15 Million investments received from Proparco. Company has currently 3.4 GW of renewable portfolio including under implementation projects and is targeting to expand to 5 GW over next two years. Earlier this year, Company has so far raised over INR 1450 crores in equity funding from ADB, DEG,FMO and Promoters. Avaada Energy Pvt Ltd a leading solar project developer, received USD 15 Million in equity investments from Proparco, French development finance institution for part financing its renewable energy portfolio of the targeted 5 GW capacity.

T 28

his infusion will further catapult Avaada’s leadership role in India’s transition to clean energy and contribute in achieving Prime Ministers vision of 175 GW of solar energy by 2022. We thank Proparco for faith reposed in Avaada in challenging times for the sector. This clearly establishes the capability and strength of Avaada in executing renewable projects and attracting quality global investors. Avaada will continue to seek investment from quality long term investors to grow its portfolio which will help the country’s fight against climate change. Reinforcing its commitment towards bringing sustainable energy to developing economies, Avaada is targeting an extensive portfolio of 5 GW solar energy projects across Asia and Africa of which about 3.4 GW capacities are currently either operational or under implementation.

JANUARY- 2020

Speaking on this development Vineet Mittal, Chairman Avaada Group said, “Avaada is committed to provide sustainable environment for future generation. We are targeting an extensive portfolio of 5 GW solar energy projects across Asia and Africa. I am thankful and appreciate investments by PROPARCO in our renewable energy venture. Recently we have received investments from ADB, DEG & FMO. Investments by these global financial stalwarts revalidates our impeccable execution track record, high preforming assets generating maximum returns for all our stakeholders”

Source: Avaada Energy

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BUSINESS & FINANCE

Bank of America extends Rs 356.5 cr line of credit to Fourth Partner Energy Bank of America (BoFA) has extended a revolving credit facility of Rs 356.5 crore to Fourth Partner Energy. The firm will deploy these funds to grow its operational solar portfolio by close to 150 megawatt (MW) over the next 18 months, it said

evolving credit facility is a type of credit that does not have a fixed number of payments. “By providing this revolving credit facility, Bank of America is helping to accelerate the transition to a cleaner and more sustainable power generation base in India,” the Hyderabad-based company said in a press release. This transaction expands upon Bank of America’s Environmental Business Initiative, which deploys capital to low-carbon, sustainable business activities.

For us, this access to capital from Bank of America is important not just to strengthen and expand our businesses at efficient costs, but also because this relationship with Bank of America can open the door to long-term capital solutions for the sector, said Vivek Subramanian, co-founder Fourth Partner Energy. In 2018 , TPG Capital, through its impact investment arm, The Rise Fund invested into Fourth Partner Energy, and since then TRF has worked closely with the company to help create new pathways to expansion.

India plays a vital role in curbing global emissions and Fourth Partner Energy is driving that change. Through innovative financing products like this one we can help scale projects that are reducing greenhouse gas emissions, as well as support India’s role in solar energy development, said Anne Finucane, vice chairman of Bank of America. To date, Fourth Partner Energy has executed distributed solar projects with a cumulative capacity of 200 MW across 23 states in India for over 150 corporate and government clients.

This new partnership with Bank of America will help Fourth Partner scale their growth. Rise catalyses partnerships like this that scale positive environmental impact, added former Secretary of State John Kerry, Senior Advisor to The Rise Fund and Chairman of Fourth Partner Energy’s Advisory Board. Fourth Partner Energy is looking to add 220-250 MW of capacity to its operational portfolio this year and is actively pursuing the Open Access Group Captive model. Source: energy.economictimes.indiatimes

Adani Green’s $362 mn bonds issue gets global interest ‘The Adani Group’s aggressive moves in the dollar bond market have led to amplified interest for foreign investors in the Indian renewable energy space,’ a company statement said, adding that the bond had a door-to-door maturity of 20 years, and a weighted average life of 13.47 years.

Billionaire Gautam Adani’s renewable energy firm Adani Green’s $362.5 million (about Rs 2,570 crore) bonds issue attracted the interest of investors worldwide, the company said on December 16. This was the first ever deal from India to use an amortizing project finance type structure, giving foreign investors a chance to buy investment-grade bonds from India’s renewable energy sector. “The Adani Group’s aggressive moves in the dollar bond market have led to amplified interest for foreign investors in the Indian renewable energy space,” a company statement said, adding that the bond had a door-to-door maturity of 20 years, and a weighted average life of 13.47 years.

S accounts picked up 24 per cent of the bonds, alongside 60 per cent allocation to Asia and 16 per cent to EMEA. “Adani Group’s moves in the dollar bond market displays one of the Indian companies that has successfully tapped the offshore bond market in the year of 2019,” it said. Adani Green’s bond structure met the stringent standards for being considered as investment grade. “The three wholly owned subsidiaries of solar power under Adani Green Energy – Adani Renewable Energy, Kodangal Solar Parks and Wardha Solar (Maharashtra) – issued the bonds. Between them, they have a total solar capacity of 570 MW, and long-term power purchase agreements with a weighted average remaining term of about 24 years with entities such as state-backed Solar Energy Corp of India,” the statement said. Barclays, Citigroup, Credit Suisse, Deutsche Bank, JP Morgan, MUFG and Standard Chartered were joint global coordinators and bookrunners. Source : moneycontrol

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JANUARY- 2020

BUSINESS & FINANCE

LONGi Solar entered into a major deal with Adani Green Energy to supply solar panels in 2020 LONGi, the world’s leading solar technology company and Adani Green Energy, India’s largest photovoltaic power station developer, has entered into a strategic partnership agreement on November 28, 2019 where LONGi will supply Adani Green Energy with its new generation Hi MO4 modules. The agreement set guidance of up to 1.2GW modules to be delivered to Adani by 2020. Both parties agreed to continue to deepen their strategic partnership over the next 3 5 years.

Dennis She, Senior Vice President of LONGi Solar and Jayant Parimal Chief Executive Officer of Adani Green Energy, signed the strategic partnership agreement on November 28, 2019 in India.(Photo: Zhang Ruoying/LONGi Solar)

LONGi leads the solar PV industry with product innovations and optimized power cost ratio with breakthrough monocrystalline technologies. LONGi supplies more than 30GW of high efficiency solar wafers and modules worldwide yearly, about a quarter of global market demand. Today, LONGi is recognized as the world’s most valuable solar technology company with the highest market value and a major power generation equipment supplier in the global solar energy field.

At the signing ceremony, Jayant Parimal, CEO of Adani Green Energy, said: “LONGi is a trusted partner with a leading position in product technology and financial health. LONGi’s high efficiency and reliable PV module products will help Adani deliver greater value to our customers and bring superior clean energy to India and the world.”

he electric power infrastructure in India is weak and photovoltaic energy has great potential for growth in the next five years. The strategic partnership agreement represents a strong alliance and a “win win” cooperation between the world’s leading energy investment company and the world’s leading solar technology company, and is a milestone in the development of global renewable energy. The Adani Group is an integrated business conglomerate in India that consists of six publicly traded companies with combined revenues of $13 billion. Its renewable energy subsidiary, Adani Green Energy, is one of the largest renewable companies in India engaged in the development of solar, wind and hydro energy with a current project portfolio of 5,290 MW.

We are very grateful to Adani for their trust and support. LONGi will seek to deepen our cooperation globally and mutually continue to improve the level of the strategic partnership. said Dennis She, Senior Vice President of LONGi Solar. “As a driver in the global energy transformation, LONGi will continue to leverage its leading technologies and work with Adani to build best in class solar projects in India and the world, and to promote the rapid development of global renewable energy.” LONGi hopes to bring high quality and affordable clean electricity to India with its innovative photovoltaic products and technologies. LONGi and Adani will jointly promote the transformation of renewable energy and the structure of clean energy in India based on both companies’ common philosophies and missions in energy transition.

Source: LONGi

JANUARY- 2020

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BUSINESS & FINANCE

Sembcorp to buyout local Indian partner Gayatri Energy in Indian unit for Rs 406 cr Singapore-based Sembcorp Industries said it has signed an agreement to acquire the remaining near 6 per cent stake of its local partner Gayatri Energy Venture Pte Ltd in the Indian arm, Sembcrop Energy India Ltd (SEIL), for Rs 406 crore. “Following the completion of the proposed acquisition, Sembcorp will become the sole owner of SEIL,” the company said in a statement. Sembcorp’s India energy arm, SEIL is a leading independent power producer in the country focused on growing a clean energy portfolio. At present, SEIL has a portfolio of thermal and renewable energy assets of more than 4,300 MW. The company said, “Its wholly-owned subsidiary Sembcorp Utilities has entered into a non-binding term sheet with its local Indian partner, Gayatri Energy Ventures Pte Ltd (GEVPL), a wholly-owned subsidiary of Gayatri Projects Limited (GPL), to acquire the remaining 5.95 per cent stake in Sembcorp Energy India Limited (SEIL),” the statement said. “There is also potential future earn-outs for GEVPL on the achievement of certain milestones by SEIL. The acquisition will be funded through a mix of internal funds and borrowings,” it said. “The proposed acquisition will allow Sembcorp to have the flexibility as sole owner to evaluate and pursue a full range of growth opportunities in the renewables segment, while at the same time seeking the right equity window to list its India business or to pursue other capital recycling options.”

The acquisition is expected to be completed by end of the year, subject to the satisfaction of certain conditions precedent, including shareholders’ approval of GPL. “Negotiations on the definitive agreements are currently ongoing and Sembcorp will make an appropriate announcement when there are material developments on this matter,” it said. This year, SEIL has commissioned 357 MW for the Solar Energy Corporation of India (SECI) 2 and SECI 3 wind power projects in India, bringing total commissioned capacity for SECI wind power projects to 607 MW out of 800 MW. This is the largest operational generating capacity among SECI wind auctions, reflecting the strength of SEIL’s capabilities. Source: PTI

BlackRock Raises $1 Billion For Clean Power as Wind, Solar Boom Here’s the latest indicator of how hungry investors are to profit from clean energy: BlackRock just raised $1 billion for wind, solar and batterystorage projects. The world’s largest money manager received initial commitments from over 35 institutional investors in North America, Europe and Asia for its third global renewables fund. It’s the most BlackRock has raised yet for a clean-power fund’s first close.

Renewable energy is becoming “one of the most active sectors in infrastructure,” said David Giordano, global head of BlackRock renewable power. It comes, he said, “as global power generation shifts from twothirds fossil fuels to two-thirds renewables over the next few decades.”

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lean-energy investments have surged as much of the world pushes to move beyond fossil fuels to fight climate change. Wind, solar and other forms of renewable power will attract about $322 billion annually through 2025, according to the International Energy Agency. That’s almost triple the $116 billion a year that will go into fossil-fuel plants. BlackRock Real Assets aims to raise a total of $2.5 billion for the fund, Giordano said. Its renewable power group manages $5.5 billion in assets. Its first renewables fund raised $611 million and is full invested. The second one raised $1.65 billion and has committed nearly all of it. Source: Bloomberg L.P.

JANUARY- 2020

BUSINESS & FINANCE

Canada’s CPPIB to invest up to $600 million in Indian infrastructure fund The deal includes a commitment of $150 million in NIIF’s Master Fund and co-investment rights of up to $450 million in future opportunities to invest alongside the Master Fund

L&T Construction Bags Significant Contracts For Various Businesses Engineering major Larsen & Toubro (L&T) said it has bagged several orders for different business segments in domestic and international markets. “In Maharashtra, an empanelment and rate contract has been awarded to provide off-grid DC solar photovoltaic water pumping systems with standalone lighting systems for farmers in the Aurangabad, Nashik and Pune revenue divisions,” said L&T Construction in a statement. “These systems will have provision for mobile charging, transfer of automated meter reading and water discharge reading data

n the United Arab Emirates, the business has secured an order for the design, supply and construction of a 132 kilovolt substation project with associated 132 kilovolt cabling works from one of the government utilities. Additional orders have been won in ongoing projects in the Middle East, said the company. In transportation infrastructure, the business has secured a major add-on order from an existing client in Qatar for an expressway. “Additionally, various add-on orders have been received by some existing projects in the water and effluent treatment (WET) and metallurgical and material handling (MMH) businesses.” Larsen & Toubro is an Indian multinational engaged in technology, engineering, construction, manufacturing and financial services with over 21 billion dollars in revenue. It operates in over 30 countries worldwide. Source: ANI

JANUARY- 2020

anada’s biggest public pension fund is investing up to $600 million in India’s National Investment and Infrastructure Fund (NIIF), as it seeks to grow its infrastructure bets in Asia’s third-largest economy. The deal includes a commitment of $150 million in NIIF’s Master Fund and co-investment rights of up to $450 million in future opportunities to invest alongside the Master Fund, Canada Pension Plan Investment Board (CPPIB) said in a statement. The NIIF is majority-owned by institutional investors, but says is anchored by India’s government, which is also an investor in its Master Fund. India needs investments worth about $778 billion for highways, urban transport and renewable energy by 2022, according to the India Brand Equity Foundation, a government body.

With CPPIB’s investment, NIIF’s Master Fund now has $2.1 billion in commitments, it said. Source: reuters

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BUSINESS & FINANCE

FMO to invest more in Shell-backed solar ower firm Orb Energy Dutch development bank FMO has proposed an additional equity investment of €1 million ($1.11 million or Rs 7.91 crore) in Orb Energy Pte. Ltd, a solar photovoltaic and solar thermal solutions provider.

MO said in a disclosure it intends to purchase the equity stake from an early-stage impact investor in Orb. This will give FMO a “greater opportunity” to influence Orb’s development, especially with regards to corporate governance practices, the Dutch investor said. It didn’t name the early-stage investor. According to VCCEdge, the data research arm of Mosaic Digital, some other investors in Orb Energy include impact investor Acumen Fund, German development finance institution Deutsche Investitions- und Entwicklungsgesellschaft (DEG), Zouk Capital, Renewable Capital, Bamboo Capital Partners and global energy giant Royal Dutch Shell Plc. In October, Shell acquired a stake of almost 20% in Bengaluru-based Orb Energy. At the time, Orb said the investment from Shell’s New Energies business would help it provide lower-cost solar power to more Indian small and medium-sized enterprises (SMEs). In its disclosure, FMO said Orb had positioned itself with a unique combination of manufacturing capabilities, engineering, procurement and construction services, strong distribution networks and in-house financing services for solar thermal and photovoltaic systems.

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“This extensive expertise Orb has built over the years serving SME customers will assist the company’s strategy to increase its presence in the economically viable and attractive commercial rooftop solar market across India,” FMO said. Orb was co-founded in 2006 by Damian Miller and NP Ramesh, who function as the company’s chief executive officer and chief operating officer, respectively. It claims that it has sold 160,000 rooftop solar systems in India with cumulative capacity of about 75 MW since inception. In January last year, Orb had raised $15 million from FMO and US government agency Overseas Private Investment Corporation through a combination of equity and debt to bolster its flagship finance platform. Prior to that, FMO had invested $2 million in Orb in 2015. In June 2011, Orb had raised $1.1 million in equity funding from non-profit venture firm Acumen Fund. The company had said that it would use the funding to extend its household lighting systems to rural customers, scale its manufacturing and develop new products.

FMO’s India investments The Dutch development bank finances projects through equity and debt instruments in sectors such as agribusiness, food and water, energy and financial institutions in underserved regions. Along with the Washington-headquartered International Finance Corporation, it is one of the most active global investment institutions in India. Last month, it invested about $30.27 million in CreditAccess Grameen Ltd, which operates a microlending business under the Grameen Koota brand name. At the end of October, it proposed a $40 million debt investment in non-banking finance company Ess Kay Fincorp Ltd. In the same month, it proposed a €7.50 million ($8.29 million) investment in Sahyadri Farmers Producer Co. Ltd. FMO said the proposed investment will help Sahyadri finance the construction of collection centres for the warehousing and transport of produce. Its other bets include a debt investment of $30 million in Kolkata-based Srei Equipment Finance Ltd, and Nomisma Mobile Solutions Pvt. Ltd, which owns digital payments and loans platform Ftcash. Source: vccircle

JANUARY- 2020

BUSINESS & FINANCE

SoftBank sister firm to invest $4 bn in Gujarat’s renewable energy sector

The investment will be in solar energy, wind energy and other unconventional renewable energy sources, it said. SB Energy, a sister company of Soft Bank of Japan, has announced that it will invest USD 4 billion or Rs 30,000 crore in renewable energy sector in Gujarat, a state government release said

he announcement was made at a meeting between chief minister Vijay Rupani and Executive Chairman of SB Energy Manoj Kohli. The investment will be in solar energy, wind energy and other unconventional renewable energy sources, it said. The present installed capacity of renewable energy in Gujarat is 8,885 MW and the state government aims to ramp it up to 30,000 MW by 2022.

“Of this 30,000 MW, 20,000 MW will be used in the state while another 10,000 MW will be given to other states. SB Energy’s announcement of investing 4 billion US dollars will go a long way in achieving the target,” the release said. Rupani, also inaugurated a Global Business Services Centre of Bank of America at Gujarat International Finance Tec-City (Gift-City) in Gandhinagar. Chief Operations and Technology Officer of Bank of America, Catherine Bessant, said it started its operations in India in 2004, and this was its fifth unit after Hyderabad, Mumbai, Guragaon and Chennai. Source: PTI

REC raises $500 million via unsecured notes RECNSE said it has raised USD 500 million (about Rs 3,550 crore) by issuing unsecured notes, and the proceeds would be used for lending to power sector. “REC Ltd has issued USD 500,000,000, 3.50 per cent notes due 2024, on December 05, 2019. The notes will mature on December 12, 2024 and all principal and interest payments will be made in US Dollars,” the state-run company said in a BSE filing. The settlement date for the notes is expected to be December 12, 2019, it added.

T 34

he notes represent direct, unconditional and unsecured obligations of the issuer and will rank pari passu among themselves and all other unsecured obligations of the issuer. The notes will be listed on the London Stock Exchange’s International Securities Market (ISM), Singapore Exchange (SGX-ST), India International Exchange (India INX) and NSE IFSC, the filing said. The net proceeds from the sale of the notes will be applied for lending to power sector, it added.

JANUARY- 2020

Source: PTI

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MEDIA PARTNER

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JANUARY- 2020

35Â

exclusive interview

Mr. Luke Lu

Head of APAC Region and Vice President Longi solar 36Â

JANUARY- 2020

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exclusive interview Luke Lu, heads the APAC region as Vice Presidentfor LONGi Solar. He joined the integrated monocrystalline PV maker two month ago driving the company’s solar module business in APAC, which includes India, Japan, Korea, Mongolia, South East Asia, Australia, New Zealand, the Pacific Islands as well as Central Asian countries like Kazakhstan. This is a high growth and opportunity region for solar power project development. EQ: What is the solar opportunity size in the APAC region? LL: Being one of the most abundantly available renewable energy resources in Asia Pacific, solar energy is witnessing tremendous growth across countries in this region. In some countries, it is becoming the mainstream source of energy, due to encouraging government policies and incentives as well as improving solar project economics. PV equipment cost has already declined significantly in the past few years owing to technological advancements and economies of scale.

EQ: How do you plan to leverage your past experience to strengthen LONGi's position in the APAC market? LL: I have been working in this industry and market region extensively. As many may know,before joining LONGi, I was with Sungrow the past five years –most recently as President, Sungrow APAC. Having worked in all the geographies of this region, I have gained significant working and business development experience across different cultures, policy and regulatory regimes, local team building traditions and practices, consumer behavior and more.All these factors are important to drive local teams towards achieving ambitious targets.

EQ: How would you describe the opportunities and challenges in the Indian solar market? What has been LONGi’s marketing strategy to address these challenges? LL: My first trip to India was in the beginning of 2015 when I attended the RE-Invest conference in Delhi. Itwas a great honor to listen to Prime Minister Narendra Modi’s inspiring speech aboutthe renewable target for India. His speech and his vision fully inspired me and made me believe I can do something to contribute to such a great ambition. That was the start of my journey in India.Fromthen to now, the market situation is totally different. The opportunity size is huge andthe market landscape has evolved and matured.Developers, EPCs, suppliers, etc. have also changed a lot. Today, the market has become much more competitive and everyone is doing their best to gain market share. LONGi has its special strength as it owns the full value chain which can bring more value to customers andsupport them to achieve more together.

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It is also a challenging region due to high competition and diverse cultures. But Lu’s aim is clear –to take LONGi to the No. 1 spot across all APAC markets. That is certainly a tall task, but he is confident. In this interview, Lugives his perspective on market and policy changes in APAC with a special focus on India, as well as an update on the company’s key achievements and vision. As a 100 per cent believer in Monotechnology, from the company’s very beginning, LONGi devoted itself to the development and promotion of mono-crystalline technology,even when no other companies believed in its advantages. We have invested significantly in developing and enhancing this technology to an extent that the solar market today believes in our founder’s and top management’s vision. Our target is very simple and clear, that is to be number one in the world and in every major solar market, among which India is definitely one of the most important. The best part about Indian customers is that they are very fair and they give all equipment makers a fair chance to prove their offerings. In such a fair market, LONGican contribute a lot. We are already recognized as one of the most reputed brands and well accepted by all customers due to our vision, strength, innovation, highproduct quality and after-sales service. Most importantly, LONGi cares about its customers, no matter the size and market share.

EQ: How would you define the company's key USP which has helped it get repeat orders and new clients in this market? LL: LONGi’s innovation and technology, product quality and customer service, our local team and local approach in serving our customers - all these comes together to gain customer confidence and support.

EQ: What are LONGi’s plans in terms of domestic manufacturing in India? LL: We are in talks with serious and strong potential partners for local manufacturing. We will definitely try our best to support the Indian Prime Minister’s “Make in India”mission and contribute more towards creating manufacturing jobs in the Indian economy as well as towardsa greenercountry. We are very keen to make it happen.

EQ: What are the company's targets and plans for the coming fiscal? LL: Our target is to become the number one player in terms of market share and be recognized as the most reputed PV brand among all customers.

JANUARY- 2020

exclusive interview

Mr. Brijesh Prajapati Managing Director- India SOFAR solar

Sofarsolar is part of the Sofar Group, a highly diversified company who are No.1 in the GPS business. They have been involved in the communications and renewable energy fields since 2007 and entered the PV inverter business in 2012 with the establishment of Sofarsolar, specializing in R&D, production, sales and service of grid-tied inverters. SOFAR is very pioneer group in GPS sector in china & we would like accept new challenges in the market.

So we have started PV market business & doing successfully business globally. In order to support the current growth of the Indian PV market, SOFARSOLAR has recently taken steps to strengthen its business position in the country with a new office and leadership. Looking to expand its footprint in the Indian PV market, SOFARSOLAR, added an office, warehouse, Service staff and expanding team.

ew versions of Inverters which are very compact in size make SOFARSOLAR differentiate from others. SOFARSOLAR is positioned to play important and leading role in the Indian solar industry. As a high – tech international corporation, SOFARSOLAR is equipped with leading technology of grid tied inverters. The R&D team of SOFARSOLAR has strong development capability. Around 100 experienced engineers are working with more than nine series products. And around 400 employees in factory increased our production capacity to 8GW annually. From day one our company has put quality as the most important criteria in our design, production and daily operations. Our international R&D team designed the product from bottom up. We hand-picked each component and we have drew every bit of the circuitry. Therefore we understand exactly how the device shall perform in every situation. We sourced all our electronic materials from U.S., Germany and Japan, such as Fairchild, Infineon, Texas instruments, Panasonic, Nichicon, Tamura, Microsemi, Amphenol, Sanyo. We are certainly not the cheapest inverters you can find in China. But if you consider quality is important, you will not regret to work with us. New versions of Inverters which are very compact in size make SOFARSOLAR differentiate from others. SOFARSOLAR is positioned to play an important and leading role in the Indian solar industry.Having global experience, innovative solutions, and dedication to developing a local presence, SOFARSOLAR is well poised to support the Indian PV market in its rapid growth. SOFARSOLAR recent move to strengthen its position in the Indian PV market with a local team signifies our commitment to the solar sector in India. We are continuous growing company and we have variety of products like NEW ENERGY AUTOMOBILE (Supercharger) products & HYBRID INVERTER, STORAGE INVERTER & ON GRID string inverter developments in our basket.

JANUARY- 2020

To cater to the Indian Market we have established ‘’Sofarsolar India Pvt. Ltd’’ our Marketing and Service Center in Ahmedabad,Gujarat. We are performing very good in India renewable market . SOFARSOLAR is a fastest growing product with good qualities, lesser service complain & prompt service solutions. No compromise in quality to make cheap product , no compromise in product component material, wide display is OUR KEY Features. Sofarsolar have good strong market in ROOFTOP Solar business & also in EPC Sector. We are believing in LOCAL SALES-PROMPT SERVICE SUPPORT with LONGVISION Reliable Product Business Policy. In price completive market SOFAR OFFERING 8 YEARS Warranty with GOOD Quality Products.

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exclusive interview EQ: How much Inverters have you supplied to India till now, what is the target/expectation in 2018-2019 ? BP: Since 2016 ,We have supplied more than 350Mw+ solar inverter systems in india & With Customer great support & trust we are doing good business in Indian market. Also we have very long vision business road map in current & future sales growth. Current year projection is more than 250Mw+ & with client-Business partner support will cross Target order projection value.

EQ: Please share your Road Maps – Pricing, Technology etc. BP: To cater to the Indian Market we have established "Sofarsolar India Pvt. Ltd" our Marketing and Service Centre in Ahmedabad,Gujarat. Our range of gird tied inverters include 1KW to 6KW in single and 3KW to 70KW in three phases, Support zero export solution . 3kW power storage inverters and 3-6kW hybrid inverters in Single Phase & 10-20kW hybrid inverters in Three Phase, Li-Ion Batteries. PRODUCT ROADMAP 2020:a. Hybrid Inverter- 3kW/3.6kW/4kW/5kW/6kW (1 Phase). b. Hybrid Inverter- 8kW/10kW/12kW/15kW/20kW (3 Phase). c. AC Retrofitting Single phase 6kW. d. 2nd generation of 50kW/60kW/70kW. e. New upcoming Rating:- 80kW/100Kw/120Kw. f. New upcoming Rating:- 220kW/250Kw with 1500v DC. g. Electrical Vehicle Charger. h. SOFAR AMASS Li-Ion Batteries.

EQ: Upcoming & Trending Opportunities with Bifacial , PERC, Wind-Solar Hybrid, Floating Solar etc BP: The Indian solar energy segment is considered to be a market with one of the fastest growth potentials in the world due the country’s ever-increasing demand for energy. India is one of the countries with the largest production of energy from renewable sources & in a now days Wind power is now the world's fastest growing energy source also. India has abundant availability of solar irradiance and receives solar energy throughout the year & this has created enormous opportunities to solar energy from the sunniest sites in the country, especially from Rajasthan, Gujarat and Andhra Pradesh. India is situated at an ideal geographical location and receives ample tropical sunlight. There are almost 300 sunny days with clear skies each year in India. Thus, rooftop solar panels are ideal to be used here. Along with the generation of electricity, solar power can meet several other purposes. According to a new study, the market for Solar Hybrid Inverter is witnessing a noticeable surge across the world. The research report, titled “Global Solar Hybrid Inverter Market 2019 Industry Research Report,” explores the past and current appearance of this market in a bid to earn a clear insight into its future potentials. It also takes the driving forces, challenges, prominent trends, opportunities, and various other factors that influence the growth of this market in consideration to discover the market’s scope in the years to come. SOFARSOLAR is currently focused on increasing its core technology R & D investment in Grid connected inverters, Energy storage inverters and it’s charging pile. With this in mind, they aim to improve the competitive advantages of their core product range and provide further valuable service to their customer base.

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SOFARSOLAR HYD inverter can work in auto or Time Of Use (TOU) mode, charge / discharge the battery when needed. In auto mode, the HYD-ES inverter will charge surplus PV energy into the battery & discharge battery to supply power to local load when PV energy is not enough. In case of blackout, HYD ES inverter can work in Emergency Power Supply (EPS) mode. HYD ES inverter will utilize power from PV panels & energy stored in the battery to supply power to critical load. With many new functions, SOFARSOLAR battery inverter were widely used in 60+ countries (e.g. Australia, the UK, Germany, Italy, Belgium, Spain, Netherland, France, China etc.), which enable residents’ supply to be secured even in the event of grid failure and decrease the electricity bill. While you have this storage power station and HYD inverter, you may have non-stop energy 24hours.

JANUARY- 2020

exclusive interview ZED ( Zero Export Device) : In some part of India it takes several months to get NET METERING done for their On-Grid Solar Power Plant. It will leads to a huge loss of power production due to delay in net metering. With Zero Export device you can run your PV plant without net metering. A solution to these problems is Zero Export device will enable solar system owners & operators to limit the amount of solar power that their systems export to the GRID. The integrated power analyzer measures the total power at the point of coupling and compares this with the adjustable set point of the controller. When the consumption from GRID is above this set point, the solar energy will be increased, when the consumption is below this set point, the solar energy will be reduced.

EQ: What according to you is the current opportunities, biggest challenges, in Indian Solar Market. BP: In a now days demanding hybrid inverter, ZERO EXPORT Facilities for net metering &,roof top projects in largest MW Scale with government subsidies facilities , Agricultural solar pumping project with beneficial scheme for farmers & storage inverter future will also come very soon. Upgraded technology From 1000V/1100Vdc system to 1500Vdc system in string inverter for to option availabilities / switching in central inverter to string inverter for coast effective & easy service solution. . Already SOFARSOLAR Hybrid & Storage inverter performing very good in EUROPE,NETHERLAND,POLAND & AUSTRALIA market. In India North East & South India very good market for hybrid inverter business.

EQ: Aggressive Bidding despite of many challenges enlisted above, what is your view/opinion. BP: In India solar market is growing vey well but in a now days solar energy has suffered with some weakness points related to cancellation of allotted project bidding. Solar industry is just come out from the safeguard duty but market movement now going slow due to cancellation of big auction. Recently nearby 4GW auction cancelled by many agencies (SECI,GUVNL,UPENDA,Etc..). after auction opening if it will be completed within shorter time with policies & decided tariff then market will take some faster movement of project completion.

EQ: Kindly enlighten our readers on the performance of your Inverters in India in various geographic locations, customer feedback.

SOFARSOLAR introduces ARPC is abbreviation of the AntiReverse Power Controller as follows. a. Current sensor, CT is abbreviation of the current sensor as follows. Appropriate CT's with rated with 1% accuracy or less AWG 12~18. b. Voltage sampling cable section: AWG 12~18. c. CT sampling cable, we recommend using network cable to extend the wires of CT. d. Loading limit cable, we recommend using network cable.

EQ: Currently 10GW + Solar Projects are in the offing, Whats your plan to Capture this opportunity. BP: Yes, we are performing very good in India rooftop market . SOFARSOLAR is a fastest growing product with good qualities, lesser service complain & prompt service solutions. No compromise in quality to make cheap product , no compromise in product case material, wide display. In Indian solar market expecting big projection in coming year after last years slowdown & uncertainties due to some policy & project, PPA. Coming year expected more than 10-12GW in rooftop & Medium - large scale projects. The Government has up-scaled the target of renewable energy capacity to 175 GW by the year 2022 which includes 100 GW from solar, 60 GW from wind, 10 GW from bio-power and 5 GW from small hydropower. The government needs to be more concentrate on the end user’s requirement & support their ability for solar market development, net-metering confusion/clarification, subsidy provision. BIS Certification proposal has been welcomed by the solar industry & It’s likely to also attract more investment & development from Domestic and international manufactures. It will be create more employment in the market & also come with MAKE IN INDIA Concepts.

JANUARY- 2020

BP: The Indian solar energy segment is considered to be a market with one of the fastest growth potentials in the world due the country’s ever-increasing demand for energy.We are having very effective “TOP POSITINING” market in Gujarat, Punjab-Haryana, Maharashtra and Chennai-Kerala. Now we are more focusing on North India & North-East India region. Even though we have good installation based in North-East region remote area. a. SOFARSOLAR is continuously winning most selling Inverters in Gujarat under GEDA rooftop policy & other state also good quantum installation database with prompt service support. b. SOFARSOLAR is well positioned to become a major player in commercial roof-top & Utility-scale PV installations. c. SOFARSOLAR :- Largest installation with TOP Position in SKY PROJECT(KUSUM YOJANA ) Scheme in Gujarart,India. SOFAR inverters are installed in the farms under SKY PROJECT (Surya Kisan Yojana) initiative of GUJARAT Government at different Feeders covering GUJARAT region. Same scheme will be start very soon with another state from coming years. REFERENCE IMAGES SKY Project (KUSUM YOJANA)

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exclusive interview CASE STUDY 2: a. As part of the Southern Railway’s initiative to go green and save on electricity costs by producing of solar power, rooftop solar plants will be installed at in Palakkad and Thiruvananthapuram railway divisions.“As far as the Railways is concerned, it is a win-win situation.” b. SOFARSOLAR has been committed to corporate social responsibility ever since its foundation. SOFAR 10KTL-X and SOFAR 11KTL-X models are used in this project with RS-485 communication. By successfully completion of this project Kerala government will install more solar plants to other railway station. SOFARSOLAR :- TOP Position inverter company in GEDA-GUJARAT. SOFARSOLAR Received Award from EQ Media & another solar media orgnization: “INVERTER COMPANY OF THE YEAR” “ROOFTOP COMPANY YEAR OF THE YEAR FOR STATE OF GUJARAT” “SOLAR CONSUMER CHOICE BRAND AWARDS 2018” “Rising Star String Inverters Rooftop Scale”

EQ: Present some noteworthy projects, case studies of solar plants built using your solar Inverters. BP: CASE STUDY :- SKY PROJECT (KUSUM YOJANA). TOP Position in Gujarat a. The Gujarat government on launched a solar power scheme for farmers- Suryashakti Kisan Yojana (SKY) enabling them to generate electricity for their captive consumption as well as sell the surplus power to the grid and earn an extra buck & Now in future it will be undercover in KUSUM scheme (Government launched new scheme). SOFARSOLAR own WAREHOUSE in Ahmedabad-Guajrat with wide space & local Indian registration as name of SOFARSOLAR INDIA PVT LTD. LOCAL SALES-SERVICE SUPPORT with LONGVISION Business Policy Establishment in INDIA. b. SOFARSOLAR is currently installed more than 28MW covering whole Gujarat Region & another more than 30Mw projection to install very soon. These project demanding very high quality and flexible adaptability for various grid situations and outstanding efficiency in extreme weather condition. SOFAR 4.4KW – 70KW models are using with RS485 communication. SOFARSOLAR is biggest installer & TOP Position in SKY PROJECT Scheme. c. In recent SKY project numbers of inverters are installed in PGVCL feeder. But due to grid fluctuation of one phase w.r.t other phase inverters repetitively tripped. So we are taking voltage graphs on CRO during Peak time and find the reason of grid voltage variation. We troubleshoot that problem by upgrading inverters and changing voltage limitation for particular feeder. Now all inverters are working in all types of weather condition in different state and generate more energy. d. In adequate performance of SOFARSOLAR inverters with different data loggers, Grid voltage, extreme conditions, flexible installation pattern proves to be leading in PV market.

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EQ: What is the size of your company in terms of manufacturing capacities, growth chart, future expansion plans, revenues, shipments, ASP’s, financial figures ? BP: We have 8GW manufacturing capabilities with automatic machinery plant & in-house designing facilities & production capacities .Since 2016 ,We have supplied solar inverter systems more than 350Mw+ in India & With Customer great support & trust we are doing good business in Indian market. Also we have very long vision business road map in current & future sales growth. In 2019 projection was more than 250Mw+ & with client-Business partner support Mostly crossed Target . in A 2020 Year SOFARSOLAR is a very aggressive with new agenda for Business expansion with new innovative products & some up-gradation on current products. We have good installation in ROOFTOP Market & also last year business increased particularly in rooftop segment. Current year also good business projection in rooftop market, Rooftop is a very huge market in India & also government very supportive on rooftop subsidy policy.

EQ: What are your plans for Manufacturing set up in India, the opportunities and challenges in manufacturing in India ?

BP: Well, very interesting question about local manufacturer. If local manufacturer follow process as per required testing facility , production facilities & required manpower to do complete manufacturing task with proper testing/quality process then customer will get proper worth products as per invested coast. We are recommending to client don’t go on cheap prices & polycarbonate type of body with lesser durability life product available in market. In a now days if any local company providing cheap price product without complete process & assemble type of products so it will be not a long life system. So if client not aware about process so we requesting to them go with proper process & visit some manufacturing company in abroad or collect some online data or visit some online manufacturing setup videos & gain your knowledge to get proper product without any cheating in systems. SOFARSOLAR management decided to come in India market very soon with locally manufacturing facilities “MAKE IN INDIA “ Concept.

JANUARY- 2020

exclusive interview

EQ: Briefly describe the various technologies and its suitable applications such as Central Inverter, String, Micro Inverter, 1500V, Outdoor, Container solutions etc.. BP: Solar Inverter is Heart of the Solar PV System. Its’s convert DC to AC & Controlling & Monitoring entire SOLAR PV Systems. There are different types of grid tied solar inverters – micro, string and central. a. Micro inverter :- A microinverter consists of a small box located on the back of or situated very close to a solar panel systems . Its role is to convert the DC electricity produced by a single solar panel. Small rating voltage system. b. String inverters :- A string inverter is the type most commonly used in home and commercial solar power systems. It is a large-ish box that is often situated some distance away from the solar array. Depending on the size of the installation, there may be more than one string inverter present. Medium Rating voltage system. c. Central inverter:- Central inverters are designed for applications such as large arrays installed on buildings, industrial facilities as well as field installations – they are basically just a very large string inverter. Its in high rating voltage systems.

EQ: Kindly highlight your product, technology & company USP’s, distinctive advantages etc BP: a. Top 3 On-Grid solar inverter for the residential market in India & perfect choice for Rooftop market product. b. Top 5 String inverter manufacture in China c. Specialized in on-grid string inverter since 2012, with wide range from 1kw to 70kw d. Leading storage solution, including AC retrofitting storage inverter and hybrid inverter. Certifications: IEC 61727 / 62116 / 61683 / 60068 / 62109 /61000 /60255/ IP65 / EN 50530 & BIS Certification is under process. Why choose SOFARSOLAR inverters? Use higher voltage level capacitor. More reliability

External inductor to lower temperature. Wider MPPT voltage range Use “T” type three level topology. (Efficiency increases ≥0.2%)

Hybrid Inverter & Storage inverter is now new concept in Solar market. Needed important points of string inverter systems. 1. Well-designed inverter cases: die-casting housings go through anticorrosion and anti-rust protection processes

Higher Efficiency Safer

More Convenience

5. Support web portal for online monitoring and APP for mobile phones. 6. Support zero export solution and PID solution.

Use professional solar AC connectors as output. GFCI detecting.

3. Support RS485/WiFi/GPRS/Ethernet for data upload. inverters.

All types of inverters have leakage current detection components.

Anti-reverse power controller for 1-70kW

2. WIDE Display Screen. 4. Built-in SD card with long memories data storage capacity for

Support four uni-polar output relays. (reliable, effective heat dissipation, longer life)

All information is available on a 4-inch screen. Four buttons give easy operation. RS485/WiFi/GPRS/Ethernet

Better Monitoring

Local data is recorded in SD card for 25 years. (for 3 phase inverters)

7. Local technical support for whole India market.

IV curve shadow scanning for panel fault detecting.

8. Net metering facility.

Die-casting housings.

9. Anti-Islanding protection for grid connected inverters. 10. IV Curve scanning. 11. Long Years reliable products warranty. (SOFAR SOALR Offering 8 Years warranty in INDIA Market)

JANUARY- 2020

Better Appearance

Go through anti-corrosion and anti-rust protection processes. 8 years

For more information contact: Brijesh Prajapati, Managing Director- India Phone: +91 75670 08282

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international

Middle East clean energy projects in pipeline at $100bn The Middle East’s energy and utilities sector is undergoing an unprecedented transformation, with the shift towards renewable energy and digital innovation at the heart of ambitious energy diversification programs. As governments seek to increase energy security and maximize returns from hydrocarbon resources, utilities are pressing ahead with some of the largest renewable energy schemes in the world.

number of milestones in the push for clean energy across the region were reached in 2019, including the commissioning of the world’s largest singlesite photovoltaic (PV) solar plant, the 1.17GW Sweihan independent power project (IPP) in Abu Dhabi. Shortly after the commissioning of the Sweihan plant in March, neighboring emirate Dubai reached financial close for a $4.3bn concentrated solar power (CSP) project, the largest single-site power investment project in the world. The drive to integrate alternative energy resources into utilities networks is set to accelerate in 2020 as governments seek to meet the rising demand for power. Rapid population growth combined with ambitious industrial and economic expansion programs is resulting in growing need for power, with demand for electricity in the Middle East forecasted to triple by 2050. Energy & Utilities estimates that installed power generation capacity will be required to increase 35 per cent by 2025 just to meet rising demand.

Reducing costs and emissions With the production of electricity across the region having been predominantly fuelled by oil and gas since the 1970s, utilities are seeking to diversify fuel sources for power generation, with renewables at the core of diversification plans. While the global targets agreed for reducing carbon emissions at the Paris COP 21 energy conference in 2015 grabbed many headlines around the world, the push for renewables is being facilitated by economics. The drive for clean energy is being driven by the sharp drop in the cost of solar and wind power technologies, with the cost of installing PV solar and wind having fallen by 73 per cent and 80 per cent respectively since 2010. Much of the fall in the cost of delivering utility-scale renewables plants is being driven by Middle East and North African utilities, with the UAE, Saudi Arabia and Egypt all having set records for solar and wind power tariffs since 2015. According to data from the International Renewable Energy Agency (Irena), 167GW of renewable energy capacity was installed globally in 2017, accounting for 61 per cent of additional power capacity installed. This was more than double the capacity of new fossil fuel plants, which amounted to 27 per cent. While the percentage of clean energy installed in the Middle East has to date been more modest, with installed solar and wind accounting for 2,350MW and 434MW respectively of the region’s energy in 2017, regional utilities are pressing ahead with some of the largest clean energy programmes in the world. Energy & Utilities estimates that $100bn worth of clean energy projects are currently in the project pipeline, with total investment in clean energy to

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exceed $300bn by 2050 if the region’s utilities are to meet their ambitious targets. Saudi Arabia’s target to install 58.7GW of renewable energy by 2030 will offer some of the most exciting opportunities for regional and international investors and energy firms. The kingdom’s Renewable Project Development Office (Repdo) is planning to launch tenders for the 1.6GW third round of its National Renewable Energy Programme (NREP) by the end of 2019. The UAE will remain a focal point of the clean energy transition, having set a target of 50 per cent of its energy to be produced by carbon-free sources by 2050. Following the submission of bids in November for the planned 2GW Dhafra solar IPP in Abu Dhabi, the emirate is already working on plans for its next major solar project, PV 3, which is planned 1.5GW-2GW. In Dubai, a consortium led by Saudi Arabia’s Acwa Power submitted a worldrecord-low tariff of $1.695 cents a kilowatt hour ($c/kWh) for the fifth phase of the Mohammed bin Rashid (MBR) solar development in October. With Dubai having set an even more ambitious target of 75 per cent clean energy by 2050, the emirate will remain a key driver of renewables deployment across the region. The push to integrate renewables into the region’s energy sector will form a key part of Middle East Energy, the new name for Middle East Electricity, the leading global energy event which has been bringing an international audience together for 44 years. Clean energy will have its own dedicated track at the event, which runs at the Dubai World Trade Centre from March 3-5 2020.

Gareth Rapley, Group Director, Industrial, at Informa Markets, organizer of Middle East Energy, said renewable energy is no longer just a concept, but set to take center stage at the region’s leading utilities event. “Driven by well-designed auctions, favo rable financing conditions and declining technology costs, renewables are being brought into the mainstream. Based on the renewables targets already in place, the region, led by the UAE, could save 354 million barrels of oil which is equivalent to a 23 per cent reduction, cut the power sector’s carbon dioxide emissions by 22 per cent, and slash water withdrawal in the power sector by 17 per cent by 2030,” said Rapley. Held under the patronage of Sheikh Maktoum Bin Mohammed Bin Rashid Al Maktoum, Deputy Ruler of Dubai, and hosted by the UAE Ministry of Energy, Middle East Energy will take place on March 3-5, 2020 at Dubai World Trade Centre. Source: saudigazette

JANUARY- 2020

international

China to cut renewable energy subsidy to $807 million in 2020 China will cut its renewable power subsidy to 5.67 billion yuan ($806.50 million) in 2020 from 8.1 billion yuan in 2019, the Ministry of Finance said, as the country will soon stop funding large solar power stations.

ecause of a decline in manufacturing costs, China has been scaling back the amount of subsidies to renewable power providers, who are expected to compete with coal-fired utilities and achieve “grid price parity”. The subsidy for 2020 will be allocated to wind farms, biomass power generators and distributed solar power operators, as well as solar power projects for poverty alleviation purposes, in 11 regions across the country, according to the finance ministry. Total subsidies for solar projects are set at 2.63 billion yuan, while wind farms will receive 2.97 billion yuan and biomass generators will get 73.39 million yuan. The amount of new installed solar capacity was 16 gigawatts (GW) in the first three quarters of this year, the National Environmental Administration has reported. New solar installations in 2019 will be as much as 25 GW, down from 41 GW last year, due to easing subsidies on centralised solar projects, an industry executive said in September. China also plans to end subsidies for new onshore wind power projects at the start of 2021. Surging renewable power capacity in the recent years has left the finance ministry with a subsidy payment backlog of at least 120 billion yuan and endangered the cash flow of renewable power operators.

Source : reuters

JANUARY- 2020

Saudi Arabia has potential to be hub for green finance: KPMG

Saudi Arabia can become the center for green finance for emerging markets, which will bring huge economic and commercial benefits to the economy in line with Vision 2030, according to Michael Hayes, global head of renewables, KPMG International. “The amount of capital required to support the energy transition is vast and it is for this reason that a whole new sector called green finance has emerged in recent years delivering new products such as green bonds and green insurance. Much of the expenditure in renewables over the next 20 years will be in emerging markets and so Saudi Arabia should concentrate on creating a center for green finance for emerging markets,” he said. The Saudi government intends to attract between $30 billion and $50 billion in new investments into renewables by 2030, as it plans to tender around 9.5GW of solar and wind capacities by 2023. Furthermore, the International Renewable Energy Agency (IRENA) predicts that nearly $148 billion will be required each year until 2050 to meet the goals of the Paris Agreement and limit global temperature increases to 1.5 C above pre-industrial levels. Given these investment projections, Hayes believes it is an absolute necessity for GCC governments to invest in renewables, which is one of the key goals of governmental visions across the GCC. “Climate change is now recognized as the most significant risk on the planet and is likely to dominate the political and economic landscape for many years to come. While there are many different ways to help in the fight against climate change, transitioning from conventional power usage to renewable power is still one of the best and most effective solutions available,” Hayes said. The Middle Eastern countries are well aware of their strong dependence on fossil fuels to drive economic growth. Therefore, in an era when the long-term viability of fossil fuels is under question, it is critical that these economies diversify as soon as possible. “Renewable generation represents an ideal way to do this and over time, I expect to see Saudi Arabia and other GCC countries take a leading role in the growth of renewable energy across the region and even into Sub-Sahara Africa,” he said. Source: arabnews

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international

Xinhua Silk Road: LONGi president expresses confidence in PV industry at Fortune Global Forum

Photovoltaic power plus energy storage is likely to be the mainstream energy supply solution for the world in the future, said Li Zhenguo, president of LONGi Green Energy Technology Co., Ltd, a global leading solar tech company.

i made the remarks at the 2019 Fortune Global Forum held in Paris. As a representative of China’s private companies, Li believed under the background of China’s accelerated industrial upgrading, innovative enterprises have large development room in the market. With the global green transformation going on and guided by China’s conviction that lucid waters and lush mountains are invaluable assets, new energy, especially PV power, is drawing increasing attention, Li added. Along with the evolution of technology, the levelized cost of energy (LCOE) has been falling accordingly and PV power generation will shake off the impression of being costly, said Li. At a round-table seminar themed “China: New Frontiers for Growth”, representatives from world famous companies such as McKinsey & Company, Dassault Systems, Godiva and Secoo International discussed development of China’s economy and enterprises.

“Sustainable development is a major topic of this year’s Fortune Global Forum and LONGi lets us see how the vision can be turned into reality, which impressed the attendees,” said Sonny Wu, co-founder of an investment institution CSR. LONGi started to go overseas since 2016 and has established subsidiaries or offices in 16 countries and regions in North America, Australia, Europe, Japan and the Middle East. In the first half of 2019, the sales of LONGi’s products in overseas markets accounted for 76 percent of its total sales, with a rise of 252 percent from a year ago.

China’s Solar ‘Wobble’ Drags Down Global Growth, BNEF Says While worldwide installations are still forecast to rise this year, BloombergNEF lowered its global outlook 6% from its previous forecast as an anticipated building boom hasn’t materialized in China, the world’s biggest clean-energy market, according to a report. BNEF now expects 121 gigawatts of solar to be installed globally.

China, the big gorilla, is slowing down, Jenny Chase, an analyst at BNEF, said in an interview. “It was never healthy for the solar market to be dependent on one or two countries.”

fforts to streamline China’s solar sector have whipsawed the global industry. After an abrupt cut to subsidies and halt to some approvals last year, which sent new installations tumbling, regulators reversed course this year to again support construction with subsidies. However, a final decision on the issue announced in July has been seen as coming too late to avoid a second year of declining installations. China will install about 28 gigawatts of capacity this year, a drop of almost 37% from the previous year, according to the new BNEF estimate. The revised 2019 forecast is down from 39 gigawatts last quarter, which would have implied a year-on-year drop of only 11%. Weak demand has added downward pressure on solar-panel prices in the fourth quarter, BNEF said. Almost all components, especially cells and panels, are facing a supply glut this year and next, according to the report, titled “A Market Wobble.” Polysilicon, the raw material to make solar cells, “has never been so cheap,” BNEF said. Panel prices, currently at about 23 U.S. cents per watt for monocrystalline products, will fall by several more cents, it said. Brazil, Vietnam and some European countries are among bright spots elsewhere in the world, BNEF said. Solar exports from Chinese firms were $13.2 billion from January to August, compared with $13.6 billion for the whole of 2018, according to the report. Source: Bloomberg L.P.

Source: Xinhua Silk Road Information Service

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JANUARY- 2020

international

CLEAN ENERGY INVESTMENT IN DEVELOPING NATIONS SLUMPS AS FINANCING IN CHINA SLOWS New investment in wind, solar, and other clean energy projects in developing nations dropped sharply in 2018, largely due to a slowdown in China. While the number of new clean power-generating plants completed stayed flat year-to-year, the volume of power derived from coal surged to a new high, according to Climatescope (www.global-climatescope.org), an annual survey of 104 emerging markets conducted by research firm BloombergNEF (BNEF).

he findings suggest that developing nations are moving toward cleaner power but not nearly fast enough to limit global CO2 emissions or the consequences of climate change. The majority of new power-generating capacity added in developing nations in 2018 came from wind and solar, for instance. But the majority of power to be produced from the overall fleet of power plants added in 2018 will come from fossil sources and emit CO2. This is due to wind and solar projects generating only when natural resources are available while oil, coal, and gas plants can potentially produce around the clock. Meanwhile, the volume of actual coalfired power generated and consumed in developing countries jumped to 6.9 thousand terawatt-hours in 2018, up from 6.4 thousand in 2017. The approximately 500 terawatt hours in new coal consumption is roughly equivalent to all the power consumed in Texas in a normal year. Across the 104 emerging markets surveyed in Climatescope, coal accounted for 47% of all generation. China, both the world’s largest CO2 emitter and largest market for clean energy production and consumption, played a crucial role in the story. Investment in new wind, solar, and other non-large hydro renewables projects in the country fell to $86 billion in 2018 from $122 billion in 2017. That net decline mirrored a $36 billion drop in emerging markets’ clean energy investment figures, the largest ever tracked by Climatescope.

JANUARY- 2020

The decline was not confined to China, however. Inflows to clean energy projects in India and Brazil slipped $2.4 billion and $2.7 billion, respectively from the year prior. Across all emerging markets surveyed, 2018 investment fell to $133 billion, lower than not just the 2017 total but the 2015 figure as well. Overall, declining costs for solar and wind played a considerable factor in the fall in absolute dollar investment in emerging economies.

Emerging market clean energy project investment

Source: BloombergNEF. Notes: Includes 104 non-OECD markets plus Chile, Turkey, and Mexico. Clean energy includes investment in wind, solar, and other renewable technologies. Not included: large hydro, nuclear, or natural gas.

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international

This year’s Climatescope headline results are undeniably disappointing, said Luiza Demôro, who manages the project for BloombergNEF. “However, apart from the very largest nations, we did see some important and positive developments, in terms of new policies, investment, and deployment.” Excluding China, India and Brazil, clean energy investment jumped to $34 billion in 2018 from $30 billion in 2017. Most notably, Vietnam, South Africa, Mexico and Morocco led the rankings with a combined investment of $16 billion in 2018. Excluding China alone, new clean energy installations in emerging markets grew 21% to achieve a new record, with 36GW commissioned in 2018, up from 30GW in 2017. This is twice the clean energy capacity added in 2015 and three times the capacity installed in 2013. Despite the spike in coal-fired generation, the pace of new coal capacity added to grids in developing nations is slowing, according to Climatescope. New construction of coal-fired power plants fell to the lowest level in a decade in 2018. After peaking at 84GW of new capacity added in 2015, coal project completions plummeted to 39GW in 2018. China accounted for approximately two thirds of this decline.

The transition from coal toward cleaner sources in developing nations is underway, said Ethan Zindler, head of Americas at BNEF. “But like trying to turn a massive oil tanker, it takes time.”

The Climatescope results come just ahead of next month’s United Nations-supported climate negotiations in Madrid. Under the 2015 Paris Climate Agreement by the United Nations Framework Convention on Climate Change (UNFCCC), over 190 nations have agreed to substantially curb their CO2 emissions to avoid the worst effects of climate change. In addition, under the pact, wealthy nations promised to provide $100 billion in “north-south” funding to developing nations to help them grow sustainably. This year’s Climatescope results suggest substantial additional work will be required to meet that commitment, despite some progress. Of the total $133 billion in asset finance that flowed to supporting development of new clean energy projects in the markets in developing nations, just $24.4 billion or 18% came from sources outside those countries. Of that total, the large majority came from private sources of capital, such as international project developers, commercial banks, and private equity funds. Inflows from development banks funded largely with OECD government funds did rise to a record $6.5 billion in 2018. There is little to suggest the overall goal of $100 billion per year in support for a variety of climate-related activities will be met anytime soon, however. In addition to presenting macro trends on clean energy in developing countries, Climatescope scores and ranks individual markets on their overall potential for clean energy development. For the first time since the country was included in the survey in 2014, India was the highest-scoring nation, due to a variety of factors, including supportive policies. The rest of the top five included Chile, Brazil, China, and Kenya, in that order. Climatescope is a public resource intended to help developers and investors screen opportunities, policy-makers understand policy frameworks around the globe, and researchers access timely, but difficult to collect, data. The complete Climatescope survey, including complete data sets for all 104 emerging markets, can be found at www.global-climatescope.org. Source: BloombergNEF

China aims to boost revenue for renewable power firms China said last week it will cut its renewable power subsidy by 30% to 5.67 billion yuan ($800 million) in 2020, and plans to stop funding large solar power stations and onshore wind farms in the coming two years, partly due to a payment backlog.

hina plans to make power purchasers take fair returns into account when buying electricity from renewable power generators, according to a draft rule issued by the National Energy Administration aimed at improving their revenues. The draft rule will apply to non-hydropower resources, including wind, solar, biomass, geothermal and ocean power, the energy body said in a statement. Despite rapid expansion and a drastic fall in the cost of producing power, renewable firms are still struggling to produce power as cheaply as coalfired plants. China said last week it will cut its renewable power subsidy by 30% to 5.67 billion yuan ($800 million) in 2020, and plans to stop funding large solar power stations and onshore wind farms in the coming two years,

partly due to a payment backlog. China, the world’s largest energy consumer, has been boosting consumption of clean energy by forcing grid firms to prioritise renewable power resources and to maximise purchases from local renewable power providers. In future, local energy administrations would also need to take into account “fair returns” for renewable power producers, the National Energy Administration said in the draft rule. It did not give further details. The administration said it also plans to look at tightening supervision of grid firms, electricity trading firms and renewable power generators, in a bid to ensure electricity is bought from renewable sources. In the first 10 months of this year, China generated 38.62 billion kilowatt-hours (kWh) electricity from solar and wind resources, accounting for 6.6% of total power generation, official data showed. Source: reuters

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JANUARY- 2020

international

Greece eyes 44 bln euros in investment in switch to cleaner energy

Greece hopes to generate investment worth about 44 billion euros ($49 billion) over the next decade on projects to reduce its dependence on fossil fuels, authorities said

gameplan approved by the cabinet showed Greece will try to reduce its carbon footprint by more than 55 percent by 2030 compared with 2005, and would close down all its coal-fired power plants in the next eight years. Wind, solar and hydroelectric power should account for at least 35 percent of energy consumption by then, up from about 15 percent in 2016, with investments worth about 9 billion euros. Other investments include natural gas networks and in recycling projects. Athens expects this investment to consist largely of government spending, combined with European Union funds and foreign investment. Oil and gas imports account for more than 65 percent of total energy consumption in Greece.

“Climate change is here and we are living with the consequences on a daily basis,” Environment and Energy Minister Kostis Hatzidakis told journalists. The country will invest about 2 billion euros in the next 10 years to help tackle natural disasters from climate change like floods and forest fires. Torrential storms this week caused flash floods and the deaths of three people, while forest fires are common in Greece. In its worst tragedy, 102 people died when a fire ripped through the coastal village of Mati in July 2018. ($1 = 0.9073 euros) (Reporting by Lefteris Papadimas; Editing by Hugh Lawson) Source: in.reuters

JANUARY- 2020

China Solar Giant Sees Booming Growth Despite U.S. Panel Tariffs Terms of Trade is a daily newsletter that untangles a world embroiled in trade wars. Sign up here. One of the world’s largest solar-panel manufacturers sees booming growth in the U.S. even if President Donald Trump doesn’t lower tariffs next year.

China’s JinkoSolar Holding Co. Chief Financial Officer Charlie Cao expects U.S. demand for its products to surge nearly 45%, to 4 gigawatts, in 2020 as the Trump administration considers whether to move ahead with a scheduled 5% cut to duties on imported panels. “It’s not going to have any change,” Cao said in an interview at Bloomberg headquarters in New York. “This small change will not have a fundamental impact. A 50% change, that would be a disaster.”

he leading U.S. solar trade group, the Solar Energy Industries Association, warned that the White House may curtail the scheduled reduction in tariffs, imposed by Trump in 2018 to spur U.S. manufacturing. While they’ve prompted a handful of panel makers — including JinkoSolar — to open U.S. factories, the duties have driven up costs for developers and panel installers who employ most of the industry’s workers. If left in place, the duties will cost the industry $19 billion in investment and will lead to 62,000 fewer jobs by 2021, the solar association said in a report

White House trade adviser Peter Navarro called the group’s report “fake news dressed up in academic mumbo jumbo.” Even after opening its factory in Florida, JinkoSolar still makes about 90% of the panels it sells to U.S. developers in Asia. The company has gained 28% since Nov. 19, when it provided a bullish forecast for U.S. and global sales next year. The American depositary receipts rose 2.3% to $18.99 in New York. Source: Bloomberg L.P.

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international

Pacifico Energy Raises 29 Billion Yen for Its Second Solar Fund Pacifico Energy K.K. (“Pacifico”) announced that it has successfully completed the launch of its second solar investment fund (“Fund II”). Fund II will be comprised of five Japanese solar power plants totaling over 216 MWdc. Concurrent with the initial closing, Fund II completed the acquisition of its first solar plant, a 35MW project located in Tochigi Prefecture and will acquire the remaining four solar plants next year.

omura Securities Co., Ltd. and Goldman Sachs Japan Co., Ltd. were the co-placement agents to Fund II, which successfully raised 29 billion yen from Japanese institutional investors. Baker McKenzie acted as legal counsel to Fund II. Pacifico is also providing asset management services to these solar plants by deploying its knowledge and experience gained from successful developing solar projects totaling over 1GWdc. Fund II follows the successful launch of Pacifico’s first solar investment fund (“Fund I”) in September 2017, which raised 15.5 billion yen from Japanese institutional investors. Fund I was comprised of five Japanese solar power plants totaling over 100 MWdc and is currently outperforming its target returns. Pacifico plans to launch additional renewable energy funds in the future incorporating a pipeline of its own developed solar projects and carefully chosen external solar assets. The projects are in place to grow the funds to over 1 GWdc of projects with a 150 billion yen cumulative investment over the next two years. Pacifico also plans to extend its asset management services to those solar plants.

Pacifico believes that value creation and sustainable development are complementary goals and is committed to developing solar power projects that contribute to the improvement of energy self-sufficiency for the future of Japan, in an environmentally friendly way, and assist with the development of local communities. We strongly believe that renewable energy is a reliable, safe and sustainable energy source that will be a driving force in reducing greenhouse gas emissions globally. Fund I and Fund II are expected to reduce carbon dioxide emissions by an aggregate 160,000 tons per year.

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We are really pleased to launch our second solar fund and with the opportunity to partner again with Japanese institutional investors. Pacifico has been investing in Japanese mega solar projects since its founding in 2012. We truly believe in the asset class and look forward to forming additional investment vehicles to provide investors access to stable returns through an eco-friendly clean energy platform, Nate Franklin, Chairman of Pacifico stated.

Fund II Overview FUND II NAME

PACIFICO ENERGY SOLAR FUND 2 INVESTMENT BUSINESS LIMITED PARTNERSHIP

Origination Date

October 3, 2019

Investment Target

5 operational solar power plants in Japan

Partners

General Partners: Pacifico Energy Solar Fund 2 GK Limited Partners: Japanese institutional investors

Subscription Amount

29 billion yen

Investment Period

21 years from the date of establishment

Summary of Solar Power Plant (1) KINUGAWA FOREST SOLAR POWER PLANT Location

Shioya-cho, Shioya-gun, Tochigi Prefecture

Panel Output

35.1 MWdc

Commercial Operation Date

May 2018

JANUARY- 2020

international

China solar exports were 58 GW in first three quarters of 2019 China’s solar module exports were 58 gigawatts in the first three quarters of the year, compared to 41.6 GW for the whole of 2018, with manufacturers turning overseas after a slowdown in new domestic projects, an industry association said

ang Bohua, the vice-chairman of the China Photovoltaic Industry Association, told a conference that the total value of the country’s solar component exports hit $17.74 billion over the first three quarters of 2019 and could exceed $20 billion for the whole of the year. China’s decision to slash subsidies for new solar projects has caused a decline in new projects. Wang said new capacity additions were 16.99 GW in the first three quarters of 2019, down significantly from a year ago. Source: reuters

China’s Worst Solar Days Seen Over as Capacity Is Set to Soar The next five-year period in China’s economic calendar may herald better days for the global solar industry, with government policy expected to spur demand growth in the top market through 2025 after a slump the past two years.

nnual capacity additions are forecast at 50 gigawatts in 2021, and then increasing 10% every year through 2025, Trina Solar Ltd. Chairman Gao Jifan said during a group interview in Shenzhen. That is the period covered under China’s next economic blueprint — officially known as the 14th Five-Year Plan — that sets targets and lays out strategies. Not only would this exceed the record 53 gigawatts in 2017, it also signals a reversal of the situation since last year, when installations tumbled after the government’s abrupt cut to subsidies. China may add 45 gigawatts next year, from 28 gigawatts this year, according to a forecast from China National Renewable Energy Center, a state-backed researcher.

After China’s solar sector transitions away from relying on subsidies, the market will be “bigger and more vibrant,” Trina’s Gao said. He added that the growth forecasts through 2025 are “reasonable” given the country’s target to derive 20% of energy from nonfossil fuel sources by 2030. The nation’s total solar capacity may jump to as much as 550 gigawatts by the end of the next five-year period in 2025, according to estimates from Gao and China National Renewable Energy Center’s deputy director Tao Ye. The nation had 190 gigawatts of solar power capacity as of end-September. Solar will become the cheapest form of new electricity generation, which will help to drive growth, Tao told a conference. Annual installations may even exceed 100 gigawatts around 2025, said Wang Zhongying, deputy head of Energy Research Institute, an organization affiliated with the National Development & Reform Commission. Source: Bloomberg L.P.

JANUARY- 2020

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international

Whiplash: Bifacial Solar Modules to Retain US Tariff Exemption In a win for project developers, a court blocked the Trump administration from withdrawing a tariff exemption for imported bifacial solar modules.

court has blocked the Trump administration’s decision in October to take away the tariff exemptions it granted bifacial solar modules earlier this year, offering a reprieve for U.S. solar developers — and a small but fast-growing portion of the solar industry. In a order, the U.S. Court of International Trade agreed with renewables developer Invenergy and the Solar Energy Industries Association trade group that the U.S. Trade Representative had acted unlawfully when it withdrew its exemption for bifacial modules. That’s because the USTR issued the withdrawal “with only 19 days’ notice to the public, without an opportunity for affected and/or interested parties to comment, and without a developed public record on which to base its decision,” in violation of the Administrative Procedure Act, the order states. Decision upholds a November temporary injunction from the court, leaving bifacial modules with the same exemption they were originally granted in June.

In other words, after two months of confusion for the solar industry, U.S. bifacial module tariff policies are back where they were this summer: exempt from the tariffs on most imported solar cells and modules imposed by the Trump administration in January 2018, as part of an ostensible bid to boost domestic solar manufacturing. The decision will come as a welcome relief to U.S. solar developers that have been seeking options for higher-efficiency solar modules in a tariff-constrained environment. Invenergy’s initial filing to the court noted that it had entered into contracts based on the bifacial exemption and was shocked when the USTR abruptly withdrew them just months later. It’s also a boon to companies that make bifacial modules, such as Trina Solar, Longi, LG and Yingli. Bifacial modules can generate electricity from light reflected upward onto their rear side as well as the side facing the sun, offering a slight but significant increase in efficiency. From an installed capacity of only 97 megawatts globally in 2016, bifacial module deployments grew to over 2,600 megawatts in 2018 and are expected to reach 5,420 megawatts by year’s end, according to Wood Mackenzie Power & Renewables. But as Xiaojing Sun, a senior solar analyst at WoodMac, noted in October, U.S. projects using bifacial modules were “just not going to be cost-competitive” without tariff exemptions. Some companies with a significant U.S. manufacturing base or technologies exempt from tariffs, such as First Solar and Hanwha Q Cells, stand to lose from the bifacial module exemption. Both First Solar and Hanwha opened factories in the U.S. in the wake of the 2018 Section 201 tariff decision and have argued that the exclusion undermines those trade protections.

Tighter climate policies could erase $2.3 tln in companies value: Report Tighter government climate regulations by 2025 could wipe up to $2.3 trillion off the value of companies in industries ranging from fossil fuel producers to agriculture and car makers, an investor group warned in a report.

ules aimed at lowering carbon emissions are expected to accelerate in the coming years as countries scramble to meet obligations under the 2015 Paris climate agreement limiting global warming. Any abrupt policy shifts risk severely disrupting current investment strategies, U.N.backed Principles of Responsible Investing (PRI), a group representing investors with $86 trillion of assets under management, said in a report.

As the realities of climate change catch up, social pressure mounts, and low carbon solutions get cheaper, it’s highly improbable that governments will be allowed to let the world sleep-walk into greater rises in temperature without being compelled into forceful action sooner,” PRI Chief Executive Fiona Reynolds said. “This poses huge threats for assets and for the wider system.” Most exposed is the fossil fuel sector which could lose one third of its current value, the report said. Fossil fuels account for around two thirds of global greenhouse gas emissions. Coal firms could lose as much as 44% in value, while the world’s top oil and gas companies risk losing up to 31% of their current market share, according the report which forecasts oil demand peaking around 2027. The analysis showed that broad index-based funds such as the iShares MSCI ACWI ETF could lose up to 4.5% or $2.3 trillion in its value under the most extreme scenario. The shift would nevertheless also lead to winners. Auto makers heavily invested in electric vehicles and electric utility firms using low-carbon power could more than double their values, the report said. The report came out as world leaders meet in Madrid for the 2019 United Nations climate change conference, known as COP25.

Source: reuters

Source: greentechmedia

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JANUARY- 2020

international

Vietnam’s golden

solar years aren’t over, despite policy changes A new era dawns for solar power in Vietnam. Last month, the Vietnamese government announced it would shift to an auction system for future groundmounted solar projects, overruling a previous proposal of a second round of its immensely successful feed-in-tariff scheme.

he move, which would cut the tariff scheme that was to expire in 2021 short by one year, sparked dismay among domestic developers whose projects will be affected. But provided the Southeast Asian nation does everything right, auctions could bring long-term benefits to Vietnam’s power supply, including reduced electricity prices, better grid management and improved oversight of clean energy projects. The programme’s implementation, however, will be a balancing act. In theory, letting developers bid on solar projects rather than paying a fixed feed-in-tariff for power exported to the grid could help slash electricity prices. Auctions, after all, encourage competition, allowing only developers who beat others on the power price at which they can realise a project to participate in the market.

But to reap such benefits, Vietnam’s power grid, which has struggled with the recent proliferation of clean energy projects coming online, needs upgrading, said Bree Miechel, projects and construction partner at global law firm Reed Smith LLP.

JANUARY- 2020

With power transmission lines underdeveloped in many areas, Vietnam Electricity (EVN)—Vietnam’s electricity company that buys all power from energy producers—has often restricted power delivery from generators to prevent grid overload—in some cases to 60 per cent of a plant’s full capacity—and only pays for the electricity fed to the grid, as stipulated by its current feed-in-tariff scheme. For a price competitive auction scheme, however, this would need to change, said Miechel. With tariffs paid under the new programme significantly lower than its current feed-in-tariff, EVN would need to align power purchase agreements with international market standards to attract more investors, requiring the electricity firm to guarantee that all the power produced is paid for, regardless of whether the grid can accommodate it or not. This means auctions will fail to deliver cost reductions unless all the electricity bought can be transmitted to consumers and industries. Even if Vietnam can replicate this year’s auction success of neighbouring Cambodia, which, at 3.87 US cents per kilowatt hour (kWh), achieved a solar price about half the amount set by Vietnam’s second tariff scheme, electricity paid for but not off-taken will effectively cancel out most of the savings in power prices. “Vietnam knows that the transmission infrastructure is not where it needs to be, and that EVN will need to pay for the total solar power capacity,” Miechel said. “There is a lot of work going into the upgrade of the grid, and what the country will get out of this scheme will really depend on that.” Auctions will bring certainty to all parties involved. Developers and financiers will know what their returns on the plant are going to be. This will enable a broader group of investors and lenders to come into the market. Solar development in Vietnam has been rampant.

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international

Solar development in Vietnam has been rampant. Nicolas Payen, chief executive officer at Singapore-headquartered clean energy investment firm Positive Energy Limited said the lack of oversight of solar deployment has led to concentrated investment in some regions boasting favourable conditions, especially in the nation’s southern provinces, where cloud cover is low and solar radiation high. “What we have seen in recent years is a hyper concentration of projects in specific locations. This has put stress on the grid in those areas.” he told Eco-Business. In many instances, he adds, such grid overload has led to curtailment—the restriction of power delivery from solar plants. Opening auctions, Payen noted, will enable the government to effectively manage where and when solar assets are installed. “This will help the government manage the grid better, and that will make power purchase agreements more bankable and reduce the risk for investors to come on board,” he said. “Overall, the move towards auctions is a good thing for the country,” he added. Miechel said: “The first feed-in-tariff scheme was successful in terms of the quantity of power capacity brought online, but auctions could produce a different kind of success. If the government manages to offer internationally bankable power purchase agreements, the auction process is going to deliver low cost renewable energy, provided the grid infrastructure is in place.” Vietnam’s solar boom started two years ago when the sun-blessed Southeast Asian nation launched its first feed-in-tariff scheme to spur solar deployment, offering an attractive 9.35 US cents per kWh for a period of 20 years. With the programme set to expire in June this year, this caused a surge in construction as global solar players rushed into the country to commission their projects before the deadline. A staggering 89 new renewable power plants with a total capacity of over 3,000 megawatts (MW) came online under the scheme, far exceeding the original government target of 1,000 MW by 2020 set down in its power development plan. Should all projects currently registered be built,

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Vietnam’s total capacity would reach 26,000 MW. The second round of the scheme, announced in April this year, stipulates a tariff of 7.09 US cents per kWh—32 per cent lower than the previous amount. The reduction has caused concerns among experts that it could discourage investors and make life more difficult for domestic developers already struggling to receive financing for the projects. But the auction scheme is set to transform Vietnam’s solar developer scene entirely, Miechel told Eco-Business. Once the government adopts a take-or-pay model, ensuring developers won’t have to watch their plant run to waste, the solar auctions will likely attract more international investment giants who, unwilling to take the risk of unspecified curtailment and scaled-down returns, have previously shied away from doing business in the country. “A big change is going to be the parties bidding for those projects. We are likely to see larger utility players coming in and, based on their scale and ability to deliver low costs, squeezing out a lot of the smaller developers,” Miechel observed. She added: “Auctions will bring certainty to all parties involved. Developers and financiers will know what their returns on the plant are going to be. This will enable a broader group of investors and lenders to come into the market— groups that have stayed outside and have not participated in the feedin-tariff scheme.” Vietnam needs to accelerate solar deployment or it will run the risk of not having sufficient power generation to support its growing economy. Vietnam’s first feed-in-tariff scheme has proven to be a massive success, but not all solar projects the government has handed out permits for, amounting to a total capacity of 22 gigawatts (GW), ended up being built. The tariff, it turned out, was so attractive that it encouraged speculators to join in the game. “Out of those 22 GW approved, developers installed only four. There are clearly many permits that have not translated into real assets,” said Payen. “Cutting the second feed-in-tariff programme short will help the government clean up the market and discern real projects from speculators,” Nicolas Payen said.

JANUARY- 2020

international The shift towards auctions will not affect all solar projects in the country. Ground-mounted plants that have already signed a power purchase agreement with EVN and will enter commercial operation by the end of 2020 will be subject to a new feed-in-tariff regime, while a separate tariff for rooftop solar is to be announced in mid-December, a source close to the Vietnamese government told Eco-Business. But, according to Razzouk, there is still a lack of clarity on the new policy, leaving developers dangling. “We’re all sitting and waiting,” he said.

Assaad Razzouk, chief executive officer at Sindicatum Renewable Energy, a pan-Asean and India clean energy company headquartered in Singapore, said: “The high feed-in-tariff encouraged some companies to acquire permits for a project, only to seek to sell those rights immediately after rather than to operate in the market. There are a lot of firms in that market that went in there because the tariff allowed them to make money speculating on real estate.” “Such speculation distorts the marketplace because it artificially inflates asset prices. With the new auction scheme, these players will hopefully exit the sector,” he added.

With its power demand soaring, Vietnam needs to act quickly, Payen said. The nation is expected to need about 130 GW of electricity by 2030, up from 47,900 MW last year. “Vietnam needs to accelerate solar deployment or it will run the risk of not having sufficient power generation to support its growing economy. But that will depend on how fast they can put this auction mechanism in place,” he observed. Source : eco-business.com

China Plans to Reduce Renewable Subsidies by 30% and End Support for Large-Scale Solar Projects in 2020 China’s solar industry has been facing mounting challenges since 2018. From the start of last year, the US has been levying tariffs at rates of up to 30% on imports of China-made PV products.

he Chinese government then slashed subsidies and FiT rates for domestic solar projects under the 531 New Policy, which came into effect in the middle of 2018. China appears to be committed to the elimination of subsidies in the development of large-scale solar projects. According to a report from Reuters on November 20, China’s Ministry of Finance has announced that subsidies for local solar power stations will end at the conclusion of 2019. This move is part of the government’s efforts to cut the next year’s budget for renewable subsidies by 30%. China currently has two top-tier grid operators: the State Grid and China Southern Power Grid. There are also 17 local grid operators supplying power in 11 provinces and autonomous regions. The Ministry of Finance’s latest policy targets solar power stations connected to the local grids. However, the agency will release a separate subsidy budget for the local grid operators and China Southern sometime in the future. The announcement notice issued by the ministry includes some details on the various cuts made to the budget for renewable energy subsidies and FiT rates. The total amount is going to be lowered from CNY 8.1 billion this year to CNY 5.67 billion next year. Subsidies for solar will be reduced from CNY 3 billion this year to CNY 2.63 billion next year. On the other hand, the allocation of solar subsidies for 2020 will prioritize DG projects, the Solar Poverty Alleviation Plan, generation systems owned by independent public power producers, and some special projects for the civil sector.

JANUARY- 2020

Reuter’s report indicates that China will limit its subsidy support to small-scale solar projects and the Solar Poverty Alleviation Plan in the future. Therefore, government funding of local solar power stations is expected to end starting next year. China plans to reduce subsidies for wind and biomass generation as well. Subsidies for wind projects will be cut from CNY 4.24 billion this year to CNY 2.94 billion next year. There are even rumors that subsidies for onshore wind projects will be completely phased out by the beginning of 2021. A budget of CNY 1 billion has been set aside for supporting the development of biomass generation this year. That amount will shrink to CNY 730 million for 2020. The Chinese government justifies the ratcheting down of subsidies by pointing out that the cost of generation has been declining over the years for solar and wind. After the 531 New Policy had come into effect, the Chinese government in August last year released its plan for developing subsidy-free solar projects for demonstration purposes. This plan has been in implementation for over 10 months, and the related regulatory framework is also being built up. A source within the solar industry told Bloomberg that China’s annual installed capacity for solar is projected to plunge from 41GW in 2018 to just 25GW in 2019 due to the steep subsidy cuts to large-scale solar projects.By eliminating subsidies and transitioning to an auction system for funding solar projects, the Chinese government is also hoping to ease the growing shortfall of renewable subsidy payments. This issue came to light with the release of the 531 New Policy. Outstanding subsidy payments already reached around CNY 100 billion at the end of 2017. According to reporting from local media, the Energy Research Institute of China’s National Development and Reform Commission found that the payment shortfall had expanded to around CNY 200 billion as of the end of 2018.

Source: energytrend

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Energy storage

As lithium prices drop, private equity investors hunt for deals

A more than 50 per cent drop in lithium prices since 2018 has unnerved industry executives, fueling cuts to capital spending and halting expansions. rivate equity groups and other investors have grown emboldened by the lithium industry’s malaise, forging plans to invest billions of dollars in mining projects to develop the electric vehicle battery metal. A more than 50 percent drop in lithium prices since 2018 has unnerved industry executives, fueling cuts to capital spending and halting expansions. Shares in major lithium producers have dropped as a result, exacerbating retail investor anxiety. But Carlyle Group-backed Traxys and other nontraditional investors and lenders say they sense a buying opportunity, as electric vehicles grow in popularity and fossil fuels are phased out in a rising number of countries.

Now is the time to invest, said Erez Ichilov, managing director of Traxys Projects, which earlier this month launched a $2 billion fund with metals financier the Pallinghurst Group to invest across the electric vehicle supply chain. “When you look at how under-invested this value chain is, $2 billion is not a lot.” The Pallinghurst-Traxys Battery Materials fund plans to focus on lithium projects, as well as copper and graphite, in developed economies to reduce risk, Ichilov told an industry conference earlier this month. That and a recent spate of other deals should help bridge what analysts forecast will be an under-investment by the lithium industry in coming years.

Mining needs a lot more capital than it has been getting, said Sam Jaffe of Cairn Energy Research Advisors, who estimates more than $100 billion needs to be invested in the battery minerals supply space, including for materials like lithium, nickel and graphite.

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Texas-based private equity firm Centaurus Capital took up half of ioneer Ltd’s A$40 million ($27 million) stock offering in late November, a tacit bet that the company’s Nevada lithium project will see strong demand in coming years. The offering was backed by Goldman Sachs Group Inc and Australian private wealth business Ord Minnett. Centaurus did not respond to a request for comment. Czech utility CEZ is finalizing a deal to convert a 2 million euro ($2.2 million) loan into majority control over European Metals Holdings Ltd’s Cinovec lithium and tin project, which it says is the largest lithium deposit in Europe, an unusual arrangement for a utility. Commodities trader Transamine Trading SA earlier this year said it would lend Canadian miner CAT Strategic Metals Group nearly C$10 million ($7.5 million) for the Kamativi Tailings Lithium Project in Zimbabwe.

With strong projected demand ahead, the industry is still underserved from investments in the space, said Ernie Ortiz, president of Lithium Royalty Corp, an affiliate of Waratah Capital Advisors, which earlier this year invested A$8.1 million ($5.5 million) for a 2.5 percent royalty in Core Lithium Ltd’s Canadian lithium project. Ichilov, the Traxys investor, said his fund plans to move fast. “We want to make significant moves in 2020,” he said. “We’re big believers in the energy transition. It’s a tectonic shift.” Source: reuters

JANUARY- 2020

Energy storage

The world’s biggest electric vehicle battery makers

Asian companies dominate the market for electric vehicle (EV) batteries and they are expanding their production capacity in Europe, China and the United States in a fight to win lucrative contracts from global automakers. Some carmakers worry, however, there won’t be enough batteries for all the EVs they plan to launch in the coming years and a bitter row between South Korea’s SK Innovation and LG Chem risks exacerbating the potential shortfall. Below are details of the world’s leading EV battery makers with details of their customers and expansion plans:

CATL China’s Contemporary Amperex Technology (CATL), the world’s biggest EV battery maker, counts BMW, Volkswagen , Daimler – which makes Mercedes cars – Volvo, Toyota Motor Corp and Honda Motor Co among its customers. The company emerged as a major force partly thanks to Beijing’s policy of only subsidising vehicles equipped with Chinese batteries in the world’s biggest EV market. Beijing is phasing out EV subsidies next year. CATL, which operates factories in China, is building its first overseas plant in Germany and is considering a U.S. factory.

JANUARY- 2020

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Energy storage PANASONIC CORP Japan’s Panasonic, a supplier of U.S. EV pioneer Tesla, said it has installed equipment to ramp up production at Tesla’s Nevada plant to 35 GWh from its current production of around 30 GWh as of late October. Panasonic has said it is investing about $1.6 billion in the factory. Panasonic also produces EV batteries in Japan, China and plans to shift some of its plants to a new joint venture with Toyota. Panasonic’s clients also include Honda and Ford Motor Company.

BYD CO LTD China’s BYD, which is backed by U.S. investor Warren Buffett, is also one of the world’s biggest EV battery makers. It mainly uses them in-house for its own cars and buses. BYD said last year it is was considering cell production in Europe.

LG CHEM LTD The South Korean firm was an early industry mover, winning a contract to supply General Motor’s Volt in 2008. It also supplies Ford, Renault, Hyundai Motor, Tesla, Volkswagen and Volvo. It is investing 3.3 trillion won ($2.8 billion) to build and expand production facilities near Tesla’s plant in Shanghai. It has a joint venture (JV) in China with Geely Automobile Holdings, which makes Volvos, and is in talks with other carmakers about JVs in major markets. The firm is considering building a second U.S. factory in addition to its facility in Michigan and is expanding its plant in Poland.

SAMSUNG SDI CO LTD Samsung SDI an affiliate of South Korean tech giant Samsung Electronics, has EV battery plants in South Korea, China and Hungary, which supply customers such as BMW, Volvo and Volkswagen. Samsung SDI is investing about 1.2 billion euros ($1.3 billion) to expand its factory in Hungary though the EU is investigating whether Budapest’s financial support complies with the bloc’s state aid rules. Samsung started production last year on the Hungary plant, which will produce batteries for 50,000 EVs a year.

SK INNOVATION CO LTD LG Chem’s cross-town rival SK Innovation supplies batteries to Volkswagen, Daimler and Kia Motors, as well as Jaguar Land Rover [TAMOJL.UL] and Ferrari. An oil refiner that came to the battery industry late, SKI is investing about $3.9 billion to build three plants in the United States, China and Hungary, with a goal of expanding its annual production capacity to 33 GWh by 2022. SKI currently operates one battery factory in South Korea, with a capacity of 4.7 GWh annually. It set up a joint venture with Beijing Automotive Industry Corporation (BAIC) of China in August 2018 and another Chinese partner. It is in talks with Volkswagen about another battery JV and is building a $1.7 billion factory in the U.S. state of Georgia, not far from Volkswagen’s Chattanooga plant. Source: reuters

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JANUARY- 2020

SOLAR PROJECTS

Jakson commissions 27 MW solar power plant in Koppal, Karnataka for SolarArise Jakson, one of India’s leading energy & engineering solutions company announced the successful commissioning of a 27 MW solar power plant in Koppal, Karnataka.

his project was executed by Jakson on a turnkey EPC mode for SolarArise, a leading solar power developer. The installed plant spread across 115 acres in rural Karnataka will generate more than 4706 MWh units of electricity annually and reduce approximately 4235 tonnes of carbon emissions every year.

We are proud to have successfully executed this large scale solar EPC project for SolarArise. Jakson brings a unique combination of engineering expertise and project execution capabilities across the electrical EPC space. Our know-how and project experience across the value chain – from substations to electrical transmission, civil construction & Solar EPC – makes us an ideal choice of clients looking for a trusted EPC partner to execute their large scale projects said Praveen Pai, Chief Operating Officer – Electrical & Solar EPC, Jakson Group.

We are happy with our association with Jakson as an EPC partner for this project. They have successfully delivered this project and we look forward to strengthening our relationship. said Tanya Singhal, Founder and Director, SolarArise Source: jakson

Azure Power Wins 2 GW ISTS Solar Project With SECI Azure Power, a leading solar power producer in India, announced that it has received a letter of award (LOA) for a 2 GWs interstate transmission (ISTS) solar power project with Solar Energy Corporation of India (SECI) to supply power for 25 years at a tariff of INR 2.92 (~US 4.1 cents) per kWh. The solar power project can be developed anywhere in India and is expected to be commissioned in staggered annual phases of 500 MW each with the first commissioning expected by 2022 and full commissioning by 2025.

T 58

he power purchase agreement (PPA) allows for the waiver of ISTS transmission charges and improved protections from curtailment. As part of the LOA, the company can elect in the next 5 days to double the capacity allocated as part of a greenshoe option. The project also comes with a 500 MW cell and module manufacturing capacity requirement. Azure Power has an agreement in principle with a leading Indian solar panel manufacturer to take a majority ownership stake of this manufacturing requirement and the total investment requirement by the company is expected to be limited to 26% of equity investment.

JANUARY- 2020

Speaking on this occasion, Ranjit Gupta, Chief Executive Officer, Azure Power said, “This opportunity is attractive to us for many reasons. The tariff is 8% higher than the last discovered tariff for an ISTS project with SECI which is one of the best solar counterparties in India. Now with a 5 GW portfolio, our scale and the predictability of our growth over the next five years should allow us to capture significant efficiencies.”

Source: Azure Power

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ELECTRIC VEHICLES

China to target quarter of vehicle sales to be electric by 2025 China should adopt a plan that will see electric vehicles make up a quarter of all autos sold in the country in six years’ time, the industry ministry said as the sector struggles with falling sales.

draft blueprint for the development of the “new energy vehicle” sector — which includes hybrids and fully-electric vehicles — comes after the government withdrew subsidies for carmakers earlier this year. China is the world’s largest new energy vehicle market, but sales of electric motors plummeted 34 percent on-year in September, according to the China Association of Automobile Manufacturers (CAAM). The Ministry of Industry and Information Technology’s draft proposal said China should seek to ensure one in four of all vehicles sold in 2025 were either hybrids or fully-electric vehicles. The measures are partly to ensure the country meets its air pollution targets, and to reduce Beijing’s dependence on imported oil. China would also continue to develop electric vehicle battery technologies, improve infrastructure for hydrogen fuel cell vehicles and driverless cars, it said. The draft proposal, which includes guidelines for the development of the new energy vehicle sector from 2021 to 2035, is open for public feedback until December 9. A previous state target set in 2017 had called for 20 percent of cars sold to be electric vehicles by 2020, but the draft released gave no indication whether China was on track to meet that goal.

Fuelled by rising incomes and government sales incentives, China is the golden goose upon which the global automotive industry has staked its future. But after years of strong growth, car sales fell last year for the first time since the 1990s, hit by a slowing economy, US trade tensions and a Chinese crackdown on shady credit practices that has crimped car-financing channels. Passenger vehicles sales in China have now fallen for 15 consecutive months, according to the CAAM. The government had earlier said it was planning to impose quotas requiring carmakers to maintain a certain percentage of new energy vehicles in their Chinese production. Source : AFP

Electric vehicles maker Pi Beam raises bridge funding from GAIL Pi Beam Labs Pvt. Ltd, which builds affordable electric utility vehicles, has raised Rs 5 crore ($705,000 at current exchange rate) in a bridge funding round from state-owned natural gas distribution company GAIL (India) Ltd, according to reports. The company, which was incubated at the Indian Institute of Technology-Madras, said in a YourStory report that the funding has taken the capital it has raised in 2019 to around $1 million.

Pi Beam founder and chief executive officer Visakh Sasikumar said the company will use the latest capital it has raised for expanding its product portfolio and increasing its sales operations. The company was founded in 2013, and says it is the first electric vehicle startup in the country to offer pedal-assisted electric tricycles with onboard solar charging capacities. According to its website, some of its products include the M-03 manual tricycle and the E-03 electric tricycle. Pi Beam says it focuses on last-mile transportation, with its products enhancing operational efficiency in the micro-mobility segment through sustainable solutions.

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n April this year, the firm said it had raised an undisclosed amount in a pre-Series A round led by Bengaluru-based early-stage investor Eagle10 Ventures, with other participants including venture capital firm Bluehill Capital and high net-worth individuals. There has been tremendous investor and corporate interest in the electric vehicle sector, with the central government also having announced initiatives aimed at promoting the segment to both companies and end-consumers. In the July budget, finance minister Nirmala Sitharaman said the government would provide an income-tax deduction of Rs 1.5 lakh on the interest paid on loans taken to purchase electric vehicles and reduce Customs duty on certain parts. Last month, electric and autonomous tractor builder AutoNxt Automation Pvt. Ltd raised an undisclosed sum of money from the founders of SUN Mobility Pvt. Ltd: brothers Chetan and Sandeep Maini invested in the company through Virya Mobility 5.0 LLP. Earlier that month, eBike Go, an electric two-wheeler rental startup based in Amritsar, raised $300,000 (around Rs 2.14 crore) in a funding round led by Startup Buddy, a Gurugram-based early-stage investor. In September, electric taxi Blu Smart raised $3 million (Rs 21 crore) in an angel funding round from several investors including Ka Enterprises LLP, the family office of actor Deepika Padukone. Source: vccircle

JANUARY- 2020

ELECTRIC VEHICLES

EESL, SDMC Sign Agreement to Develop Charging Infra for Electric Vehicles EESL will install about 75 charging stations at different locations under South Delhi Municipal Corporation (SDMC) area as per the pact.

State-owned EESL and civic body SDMC signed an agreement to develop charging infrastructure for electric vehicles in South Delhi Municipal Corporation Area. The country is moving in the right direction to achieve 175 GW of renewable capacity by 2022, Minister of Power and New and Renewable Energy R K Singh said at the event. “India has embarked upon a very ambitious e-mobility plan, in which the government plays a pivotal role in enabling e-mobility. Installation of public charging stations (PCS) would help in taking considerable strides in the creation of a sustainable EV ecosystem in the states across India. It’s a great stride by SDMC and EESL to come together for harnessing synergies and opportunities in this broader effort,” he said. The MoU was signed here in presence of Singh, EESL MD Saurabh Kumar, Lt Governor of Delhi Anil Baijal, Municipal Commissioner of SDMC Gyanesh Bharti, among other government officials.

Chinese auto & electronics major BYD to invest Rs 2,800 cr in Tamil Nadu China-based automobile and electronics major BYD is planning to invest around Rs 2,800 crore in Tamil Nadu. The deal is one of the nine MoUs worth Rs 5,027 crore that companies have signed with the state government. Hero Group-backed Ather Energy’s Rs 600 crore-plus plan to establish a manufacturing facility for e-Vehicles is among the other large investment commitments.

he nine MoUs exchanged between the State and various firms have combined investment commitments worth Rs 5,027 crore and a potential to create 20,351 jobs. BYD India Pvt Ltd, the domestic arm of the Chinese parent, plans to set up a unit for manufacturing phone components. The proposed facility is likely to provide employment to 11,500 persons. Shenzen-based BYD is also a leading manufacturer of electric buses, trucks and other vehicles. Its domestic arm was established in March 2007 in Chennai and has an office in New Delhi. The Indian subsidiary has two factories covering more than 140,000 square metres, with a cumulative investment of over $150 million. BYD India’s business covers mobile components, solar panels, battery energy storage, electric buses and trucks, electric forklifts, chargers, and rail transit. Hero MotoCorp-backed Ather Energy, a Bengaluru-based maker of electric scooters, is planning a manufacturing facility for e-vehicles and lithium-ion batteries in Hosur at an investment of Rs 635.4 crore and an employment potential of 4,321 jobs.

Energy Efficiency Services Limited MD said that under the MoU, EESL will install around 75 charging stations at different locations of South Delhi Municipal Corporation (SDMC) area. “In the first phase, the EV charging station will be installed in 18 locations within 6 months from the effective date, selected through a joint survey by both parties,” he said, adding the tariff has been kept at Rs 4 per unit. “It is pivotal to establish a thriving public charging infrastructure to increase EV adoption and enhance consumer convenience. I strongly believe that a supporting infrastructure will surely enhance consumer confidence in electric vehicles in Delhi,” Baijal said. With the increasing penetration of EVs, the local emission of pollutants is also expected to reduce, leading to cleaner air providing several health benefits to the public. For charging e-cars, till date, 300 AC and 170 DC captive chargers have been commissioned. EESL also said that about 65 public charging stations have also been installed in the area of NDMC with which it had signed an MoU earlier.

Mitsuba Sical India Pvt Ltd will invest around Rs 503.6 crore to expand its range of four-wheeler and two-wheeler components. The capex is likely to generate 330 jobs. Other MoUs include ITC Paper Board and Speciality Papers’ plan to set up a paper board manufacturing unit at an investment of Rs 515 crore, Data Pattern’s Rs 50 crore plan to manufacture radar and communication systems for defence applications and Growth Link Overseas Company’s Rs 175 crore project to expand its footwear manufacturing capacity. Shreevari Energy Systems Pvt Ltd will invest Rs 250 crore to manufacture structural components for thermal and wind energy production and SNF Components Pvt Ltd and Bull Machines Pvt Ltd will invest Rs 98 crore in a construction equipment plant. The state government also signed MOUs for setting up three skills development centres at a cost of Rs 60 crore. One of the partners in this initiative is TVS Training and services Ltd, which is establishing Apex Skill Development Centre for auto, auto components and machine tools. The state also signed a knowledge partnership deal with IIT Madras for the Defence Industrial Corridor and an MoU with Defence Research & Development Organisation (DRDO) for the development of cutting-edge technologies and systems for the Defence Industrial Corridor.

Source: PTI

Source : business-standard

JANUARY- 2020

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ELECTRIC VEHICLES

Promotion of Electric Vehicles

There are multiple causes for pollution and vehicular pollution is one of the causes. The electric vehicles have zero on-road emission. The problem of pollution can be minimized by using electric vehicles in the country.

n order to promote adoption of electric vehicles, Department of Heavy Industry formulated a scheme namely FAME-India Scheme [Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India] in 2015 for the initial period of 2 years starting w.e.f. 01st April, 2015 (Phase-I). The Phase-I of the Scheme was extended from time to time and the last extension was allowed up to 31st March 2019. In this Phase of the Scheme about 2.8 lakh hybrid and electric vehicles are supported by way of demand incentive amounting to about Rs 359 crore resulting in saving of about 50 million liters of fuel and reduction of about 124 million Kg of CO2.

In addition, following initiatives were also taken up by the Government to promote use of electric vehicles use: Under new GST regime, GST on EVS is reduced from existing 12% rate to 5% as against the 28% GST rate with cess up to 22% for conventional vehicles. Ministry of Power has allowed sale of electricity as ‘service’ for charging of electric vehicles. This will provide a huge incentive to attract investments into charging infrastructure.

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The Government, vide S.O. 5333(E) dated 18th October, 2018 has also granted exemption to the battery operated transport vehicles and transport vehicles running on ethanol and methanol fuels from the requirements of permit. The Government, vide draft GSR 430(E) dated 18th June 2019 has proposed exemption of registration fees for battery operated/electric vehicles to promote the use of eco-friendly vehicles in the country. In the budget of 2019-20, the Finance Minister announced for providing additional income tax deduction of Rs 1.5 lakh on the interest paid on loans taken to purchase electric vehicles. Ministry of Road Transport and Highways has allowed the age group of 16-18 years to obtain driving licence to drive E-scooters. Ministry of Road Transport and Highways has issued an advisory dated 17th July, 2019 to all States and Union Territories to promote use of electric vehicles. This information was given by the Minister of Heavy Industries & Public Enterprises, Prakash Javadekar, in a written reply in the Lok Sabha. Source: PIB

JANUARY- 2020

ELECTRIC VEHICLES

Promotion to Manufacturing of Electric Vehicles Since inception of the Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India (FAME India) in 2015, about 2.8 lakh vehicles have been supported by way of extending demand incentives of about Rs. 359 Crore [Approx.]. As pilot project, 425 e-buses were also supported to various cities/ states to promote public transportation.

overnment approved Phase-I of FAME India Scheme in March, 2015 for a period of 2 years from 1st April 2015 to promote adoption of electrical vehicles with an aim to reduce dependency on fossil fuel and to address issues of vehicular emissions. The Phase-I of the Scheme was extended from time to time and the last extension was allowed till 31st March 2019. Based on outcome and experience gained during the Phase-I of FAME India Scheme and after having consultations with all stakeholders including industry and industry associations, the Government notified Phase-II of FAME India Scheme on 8th March 2019, which is for a period of three years commencing from 1st April 2019 with a total budgetary support of Rs. 10,000 crore. This phase will mainly focus on supporting electrification of public & shared transportation, and aims to support through incentives about 7000 e-buses, 5 lakh e-3 wheelers (e-3W), 55000 e-4 wheelers (e-4W) passenger cars and 10 lakh e-2 wheelers. In addition, creation of charging infrastructure will be also supported to address range anxiety among users of electric vehicles.

Under Phase-II of FAME-India Scheme, incentives is being provided to the consumers on purchase of electric vehicles, used for public transport or those registered for commercial purposes in e-3W, e-4W (including Strong Hybrid) segment however, privately owned registered e-2W are also be covered under the scheme. The demand incentive to these electrical vehicles is linked to battery capacity i.e. Rs. 10,000/KWh subject to capping of 20% cost of these vehicles. Demand incentive is restricted to vehicles with prices less than the threshold value which is Rs 1.5 Lakh for e-2W, 5 lakh for e-3W and 15 Lakh for e-4W. Source: pib.gov.in

Performance of Fame India Scheme Since inception of the Phase-I of FAME-India Scheme, about 2.8 lakh hybrid and electric vehicles (xEVs) have been supported through Demand Incentives.

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s pilot project, about 425 electric/ hybrid buses were sanctioned to various States (city transport undertaking) supported by Department of Heavy Industry (DHI) under FAME-India Scheme (Faster Adoption of Electric (and Hybrid) Vehicles in India). However, since Automobile Sector is a liberalized Sector, the Department of Heavy Industry is not required to maintain the data related to sale of vehicles including Electrical vehicles.

JANUARY- 2020

Source: pib.gov.in

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ELECTRIC VEHICLES

SUN Mobility’s Swappable Battery Powers Piaggio’s Ape E-City The partnership between SUN Mobility, a leading provider of energy infrastructure and services for electric vehicles (EVs), and Piaggio Vehicles Pvt Ltd (PVPL), a 100 % subsidiary of the Italian Piaggio Group and India’s leading manufacturer of small commercial vehicles, announced in October 2019, took wings today. Piaggio, Ape E-City, is the first main-stream electric three-wheeler to be launched on SUN Mobility’s integrated open-architecture platform, that supports a variety of 2 and 3 wheelers.

o be rolled out first in Chandigarh, Mohali and Gurgaon, the partnership will see a network of 50 SUN Mobility Quick Interchange Stations, spread across 10 cities in India, by March 2020. The aim of this partnership is to further the adoption of affordable and clean last-mile connectivity, while also addressing the current issues around air quality in the regions.

Diego Graffi, MD & CEO of Piaggio Vehicles Pvt. Ltd. said, “At Piaggio, we believe in providing path breaking solutions in the last mile transportation segment with best in class technology offerings to our customers. Our partnership with SUN Mobility will enable customers to experience a very innovative, smart and unique swappable smart battery eco-system in India.” By separating the batteries from the vehicles, SUN Mobility has managed to reduce the upfront cost of the vehicle to be at par with its ICE counterparts. And, by providing the energy infrastructure through a ‘battery as a service’ model, it not only enables a hassle-free, quick and affordable way of refuelling electric vehicles, but also takes away the concerns around high battery-replacement cost, low-life of the battery, and inadequate charging infrastructure. Connected by a Smart Network, each of the Quick Interchange Stations will enable 150 swaps per day, in under two minutes; thereby, addressing concerns around range limitations and long refuelling time. The minimal downtime ensures that drivers can account for more trips, resulting in increased earning opportunity.

Our network of swapping stations, along with our ‘pay-as-you-go’ model, combined with our user- friendly app will significantly increase the ease at which drivers can avail our services, and reduce their concerns around driving range, charging times and battery related operational costs. Our proven solution which has clocked over 1 million+ emission free kms and transported 1.5 million+ passengers till date, makes a very compelling value proposition for 3-wheeler drivers,” said Chetan Maini, CoFounder and Vice-Chairman, SUN Mobility. “We are happy to partner with Piaggio and have them be the first three-wheeler OEM on our platform. Their strong product portfolio, along with our solution, makes a very compelling value proposition for 3-wheeler drivers. Our aim is to continue to revolutionize the last-mile connectivity across the 2 and 3-wheelers, and buses in the country. And, this is another stepping-stone to achieve that,” he added. SUN Mobility’s energy infrastructure platform comprises of Smart Batteries that are light-weight, connected, long-life, compact and swappable. The Quick Interchange Stations are compact, easy to install and ensure quick refuelling of electric vehicles and are compatible with multiple vehicle platforms including: 2 and 3 wheelers (e-rickshaws and e-autos). And lastly, the Smart Network (an IoT-based cloud platform) helps keep a constant check on the battery vitals, tracks batteries in real time, enables digital authentication, station operations and ensures service delivery optimization. Source : ptinews

EESL commissions first EV charging station in south Delhi under pact with SDMC In a bid to build a robust EV charging infrastructure, state-run Energy Efficiency Service Ltd (EESL) and South Delhi Municipal Corporation (SDMC) inaugurated the first electric vehicle public charging station in south Delhi.

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he inauguration coincides with the National Energy Conservation Day being celebrated across the country, EESL said in a statement. The charging station has been installed in the SDMC parking area of Greater Kailash-1 N Block market. EESL has installed the charging station after the signing an agreement with SDMC. This is the first of the 75 charging stations to be installed across SDMC areas as per the agreement. The installation of public charging stations would help in increasing the adoption of electric vehicles (EVs) in the city. With increasing penetration of EVs, the local emission of pollutants is also expected to reduce, leading to cleaner air providing several health beneﬁts to the public. Source: PTI

JANUARY- 2020

ELECTRIC VEHICLES

BATTERY PACK PRICES FALL AS MARKET RAMPS UP WITH MARKET AVERAGE AT $156/KWH IN 2019 Battery prices, which were above $1,100 per kilowatt-hour in 2010, have fallen 87% in real terms to $156/kWh in 2019. By 2023, average prices will be close to $100/kWh, according to the latest forecast from research company BloombergNEF (BNEF).

ost reductions in 2019 are thanks to increasing order size, growth in battery electric vehicle sales and the continued penetration of high energy density cathodes. The introduction of new pack designs and falling manufacturing costs will drive prices down in the near term. BNEF’s 2019 Battery Price Survey, published at the BNEF Summit in Shanghai, predicts that as cumulative demand passes 2TWh in 2024, prices will fall below $100/kWh. This price is seen as the point around which EVs will start to reach price parity with internal combustion engine vehicles. However, this varies depending on the region of sale and vehicle segment. The report further examines in detail how manufacturers and automakers alike can continue to reduce prices.

James Frith, BNEF’s senior energy storage analyst and author of the report, said: “According to our forecasts, by 2030 the battery market will be worth $116 billion annually, and this doesn’t include investment in the supply chain. However, as cell and pack prices are falling, purchasers will get more value for their money than they do today.” Annual lithium-ion battery market size

Source: BloombergNEF

BNEF’s analysis finds that as batteries become cheaper, more sectors are electrifying. For example, the electrification of commercial vehicles, like delivery vans, is becoming increasingly attractive. This will lead to further differentiation in cell specifications, with commercial and high-end passenger vehicle applications likely to opt for metrics like cycle life over continued price declines. However, for mass market passenger EVs, low battery prices will remain the most critical goal. Continued cost declines for batteries in the 2020s will be achieved through reduced manufacturing capital expenditures, new pack designs and changing supply chains.

JANUARY- 2020

Logan Goldie-Scot, head of energy storage at BNEF, said: “Factory costs are falling thanks to improvements in manufacturing equipment and increased energy density at the cathode and cell level. The expansion of existing facilities also offers companies a lower-cost route to expand capacity.” As major automakers start to produce bespoke EV platforms, they are able to simplify pack design and standardize across different EV models. The simplified design is easier to manufacture and can be scaled for larger or smaller vehicles. The change in pack design will also allow for simpler thermal management systems and could reduce the amount of housing required for each module. As automakers start procuring cells from multiple suppliers for a single platform, there is also an increasing level of standardization in cell design. EV demand in Europe is growing, and supply chains are changing. Increasingly, battery manufacturers are building plants in the region. This helps to reduce some of the costs associated with importing cells from overseas, especially transportation costs and import duties. The path to achieving $100/kWh by 2024 looks promising, even if there will undoubtedly be hiccups along the way. There is much less certainty on how the industry will reduce prices even further, from $100/kWh down to $61/kWh by 2030. This is not because it is impossible but rather that there are a variety of options and paths that can be taken. As we get closer to the second half of the 2020s energy density at the cell and pack level will play a growing role, as it allows for more efficient use of materials and manufacturing capacity. New technologies like silicon or lithium anodes, solid state cells and new cathode materials will be key to helping cost reductions play out. Source: bloomberg.net

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ELECTRIC VEHICLES

Incentive and Infrastructure for Electric Vehicles As per information received from Society of Indian Automobile Manufactures (SIAM), there are about 30 crore vehicles plying on the road which are based on internal combustion engine.

epartment of Heavy Industry is implementing a scheme namely Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India [FAME India Scheme] with an objective to promote manufacturing and adoption of electrical vehicles (EVs). Under the Scheme, it is planned to support about 10 lakh e-2 Wheelers, 5 lakh e-3 Wheelers, 55000 e-4 Wheeler Passenger Cars and 7000 e-Buses through demand incentives with an outlay of Rs. 10,000 Crore for a period of 3 years commencing from 1st April 2019.In this Scheme, the emphasis is being given on electric vehicles, used for public transport or those registered for commercial purposes in e-3W, e-4W and e-bus segment. Privately owned registered e-2W are also covered. Under the Scheme, the demand incentive is linked to battery capacity i.e. Rs. 10,000/KWh for all category of vehicles except e-buses where it is Rs. 20,000/KWh. SIAM is supporting the Scheme. In addition, a budget provision of Rs. 1000 crore has been made for setting up of charging infrastructure under the Scheme and Department of Heavy Industry had issued an Expression of Interest (EoI) inviting proposals for establishment of 1000 charging stations under this phase of the Scheme.

Under Phase-I of FAME-India Scheme, the Government has supported about 500 charging stations to establish electric vehicle charging stations in the country. Out of about 500 charging stations sanctioned under Phase-I of FAME-India Scheme about 230 charging stations have been installed. Further, Energy Efficiency Services Limited (EESL) under the Ministry of Power has deployed 65 public charging stations for EVs in the country. EESL is also deploying around 300 AC and 170 DC captive chargers across Government offices in the country. As per information received from EESL, the time required to charge an e-vehicle depends on the rated capacity and type of charger. DC-001 (15kW) charger takes around 70-80 minutes for complete charging (0100%) for e-car with battery capacity of 18kWh. The unit cost of charging per unit is Rs 9.5 plus GST for public charging stations operated at NDMC, Delhi. This information was given by the Minister of State Heavy Industries & Public Enterprises, Arjun Ram Meghwal, in a written reply in the Lok Sabha.

Source: PIB

Electric Vehicle Market Seen Growing 36% Annually Till 2026 The domestic electric vehicle market is projected to grow 36 percent annually between 2019 and 2026 as the market has gained traction following the implementation of the second phase of the EV incentives scheme in April.

Under the government’s ambitious FAME II (Faster adoption and manufacture of electric vehicles) scheme to popularise electric and hybrid vehicles, up to one million EV twowheelers powered by new advanced technology battery of 2 kilowatt hour are pegged to get subsidy of up to Rs 20,000 each.

“Total EV sales in 2018 hit 365,920 units and expected to grow 36 percent annually till 2026. The battery market is estimated to be $520 million in 2018 and projected to grow at 30 percent annually during this period,” India Energy Storage Alliance said in report.

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The base year of the study is 2018 while the forecast period is 2019-2026, it said. The IESA is an alliance of 96 stakeholders comprising energy storage manufacturers,research institutes/universities, renewable energy companies and power electronics companies. Noting that total charger sales in 2018 was under 1,000 units, the report forecasts this to touch 50,000 units by 2026 as public charging points are set to rise with an estimated investment of $520 billion. It is predicted that the EV market will grow rapidly with support from government as it pushes for largest penetration. Source: bloombergquint

JANUARY- 2020

Energy storage

The transition from Lead Acid battery to Lithium Ion battery: Why is the shift necessary? The gross development of any country is directly measured by its per capita energy consumption. Now with almost each nation trying to fall under the gamut of developing and further developed nation, the energy demand of the world is poised to increase. Estimates from the major research organization suggest that the world energy demand shall increase by more than 100% in the next 15~20 years.

Growing energy requirement of the world (Source: International Energy Agency)

his means that the energy generation need to be ramped up in a similar fashion. However with the world focussing on renewables as a potential generation source and with the every altering energy requirements, both generation and consumption patterns around the world are changing at an imprecise rate.This directly means that the local and/or federal grid(s) may not always be able to accommodate such changes and the utilities need to source/dump additional energy to bridgethe generation and demand gap. Additionally with various government(s) around the world focussing on secure and reliable supply of electricity 24x7x365, the stage is set for energy storage (batteries to be more appropriate). A battery in the simple terms could be defined as a device which stores and delivers electrical energy when required. It basically comprises a positive and a negative electrode separated by an electrolyte (a liquid/semi-solid medium).The electrodes are usually two dissimilar metal (or metal polymer) where chemical reaction takes place when the battery is in use. During discharging, the electrode with the high electron affinity will release electron (which is known as anode) and the electrode with the low electron affinity will gain electron (which is known as cathode). This electron would travel through the load and thus allowing the battery to supply energy. Since the discovery and initial development of battery in the 18th century, various chemicals have been utilized to create batteries, which indirectly led to various compositions. Out of all thosevariants, use of lead acid and lithium ion battery have been prominent. While lead acid have been dominant, the energy storage market is now observing a significant shift to lithium ion battery. For a novice, it is hence necessary to understand the basics of both the battery technology and their implied advantages. Further it is also necessary to have a complete understanding about the indicators which led such shift.

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JANUARY- 2020

Typical working of a battery (Source: Google)

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energy storage Invented in early 1859 and put to commercial use in the early 19th century, Lead acid battery utilizes lead as a basematerial with the anode and cathode made up of lead & lead oxide respectively andmixture of sulphuric acid& water as an electrolyte.The battery utilizes chemical reaction between electrolyte and the cathode & anode to generate electricity. The amount of charge stored in/delivered by the battery depends on the concentration of the electrolyte and the area of the plate. While this was the basic chemistry, there were lot of variantsof lead acid battery as mentioned below: Flooded battery: These are the traditional batteries which allowed the end user to access each and every battery cell. Such access allowed the end users to refill distilled water if the battery dried out. These batteries were used mostly in automobiles (due to its ability to provide surge currents) and for emergency power backups. Sealed battery: The sealed battery is similar to flooded battery with only difference that the entire battery is sealed and the user does not have access to battery. This battery was popular amongst engine starting and limited deep cycle applications (i.e. applications requiring enhanced use of battery thus discharging at a deeper level).

Limited communication capability: Applications like off-grid, grid energy storage and power plant storage in addition to deep discharging would also need the battery to communicate its typical characteristics like individual cell voltage, temperature, current, etc. during charging and/or discharging. The lead acid battery is not capable of providing such communication firstly and any efforts to develop the same would overshoot the cost of such instrument over the cost of the battery. Toxic in nature: Lead is highly toxic metal and once the battery becomes inoperative, it is necessary to ensure its proper collection and eco-friendly recycling. If disposed without suitable measures, both lead and acid could produce a range of adverse health effects affecting the entire ecosystem around such disposal area.

Absorbed Glass Mat (AGM): In this type, the separator in the lead acid battery was replaced by a glass fibre mat. This mat while allowed for electrical inter-connection also enabled the battery to easily transport gases during over-charging, instead of losing it to atmosphere. Gel type battery: Here, the liquid electrolyte was completely replaced by a semi solid gel type electrolyte. This allowed the battery to be applicable in extreme conditions as the gel had lower freezing and higher boiling point. The gel type battery however were not capable of providing surge currents and were used most commonly in energy storage applications like off-grid systems. Valve Regulated Lead Acid battery (VRLA): Any of the above mentioned battery when they utilized valve for letting the excess gas out during charging were known as VRLA batteries.VRLA were utilized in power applications like off grid supplies, portable electrical devicesandapplications that require affordable large-scale power storage (like in conventional and nuclear submarines).

While the applications of the lead acid battery were ubiquitous, the ever increasing need of energy in the late 19th century required the amount of storage to increase exponentially. The batteries while cheap had various shortfalls which led the world to explore alternative technologies: Heavy in weight: Probably one of the first limitations of the lead acid battery is its weight, which could be directly related to its specific energy density (refer to Figure 2). The lower specific energy density directly means that the battery would require more material if it needs to deliver same amount of energy. Inefficient charging/ discharging: Charging/ Discharging a lead acid battery needs more amount of energy and this is simply because itâ&#x20AC;&#x2122;s charging/ discharging efficiency is only around 85%. The (commercially used) newer battery technologies have charging efficiencies around 95%. Longer charging time: Another issue with charging a lead acid battery is its charging time. Typically charging a lead acid battery may follow a 20-80 rule, meaning charging the last 20% of the battery capacity may take 80% of the time. Limited life time: Cycle life or more commonly the life of the Lead acid battery technology is relatively shorter. A typical battery discharged to 50% of its capacity (from fully charged state) lasts for around 400 cycles. However, if these batteries were not fully charged (a case as mentioned above) and the cycle life reduces to below 350. Further increasing the DOD of lead acid battery would lower its life exponentially. This means that the applications like off â&#x20AC;&#x201C; grid, UPS may need a battery replacement between every 2/3 years, thus increasing the OPEX of the project.

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Typical limitations of lead acid battery

While this article deal with Lead acid batteries, its types, applications and their advantages, the next article would focus on lithium ion battery explaining its variants & advantages over lead acid battery which has enabled a steep shift towards the technology. Further it would also give readers an overview of the market scenario for lithium ion battery and its applicability in Indian scenario. Keep looking at this space for our next article. Let us all pledge to make solar energy the primary source of energy in the near future.

JANUARY- 2020

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opinion

Can India achieve 175 GW RE: Piling dues

Power generators in India are standing on a wobbly pitch. Distribution companies (discoms), their largest and often only consumers, suffer from chronic inefficiencies and financial distress which translates to frequent delays in payment owed for the supplied power. This often stretches to over several months threatening financial position of generators.

ata from the Union Ministry of Power’s (MoP) Payment Ratification and Analysis in Power (PRAAPTI) portal shows that outstanding dues from 65 discoms amounted to a massive Rs 81,000 crore owed to 67 generation companies as of August 2019. Despite the central government’s recent efforts to improve discom performance through Ujjwal Discom Assurance Yojana (UDAY), utilities continue to remain the weakest link in the power supply chain. As a result, they have delayed paying the generators with outstanding dues, registering a massive jump of 33 per cent since March 2019 (see ‘Outstanding payments from discoms to generation companies’).

The challenge of payment delays and mounting dues is equally massive for Renewable Energy (RE) generators, with far reaching implications, posting one of the biggest threats to achievement of the 175 GW renewable energy by 2022 target. The Indian Renewable Energy Development Agency Ltd (IREDA), the governmentowned RE financing institution, had estimated in April 2018 that 20 per cent of the overall discom dues or about Rs 13,820 crore was owed to RE companies. Following this, the Central Electricity Authority (CEA) started dedicated monitoring of dues to RE companies. According to CEA, the outstanding payment dues towards 513 RE projects amounted to Rs 9,735 crore by the end of July 2019, affecting 26.7 GW RE capacity.

JANUARY- 2020

Dues have increased by over 33 per cent since March 2019 Outstanding payments from discoms to generation companies (Source: PRAAPTI, MoP)

Developers are struggling with cash flows due to which most have stopped bidding for new projects. Available cash is being preserved to service bank loans for existing projects. There is a looming threat that if the situation persists, projects may be declared non-performing assets. Unfortunately, there is no certainty of when this problem will end, Manoj Upadhyay, founder and managing director, Acme Solar, said. While payment delay is a segment-wide phenomenon, the plight of RE generators is worse as discoms tend to prioritise payments to coal-based power plants fearing discontinuance of supply. “The thinking is that coal-based power plants need money to buy coal and cannot afford to run beyond a point, while wind and solar plants will continue generating even if payments are not made,” a sector expert said, requesting anonymity.

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opinion

Status analysis

State-wise payment owed to renewable energy sector (Source: CEA)

The risk of payment delay varies widely across RE-rich states. Andhra Pradesh and Tamil Nadu each account for 25 per cent of the total outstanding dues, while Telangana and Karnataka collectively account for another 25 per cent (see ‘State-wise payment owed to renewable energy sector’). The payment situation in Andhra Pradesh is linked to the state government’s desire to renegotiate old “expensive” power purchase agreements. Nearly half the capacity installed in the state is affected with outstanding dues, with an average estimated delay of over 12 months. In case of Tamil Nadu, the affected capacity is twice that of Andhra Pradesh, but the average duration of delays is lower at about six months. Telangana reports the third highest dues despite only 1.8 GW being affected due to payments pending since over a year. Meanwhile, Karnataka has as much capacity as Andhra affected by delays but over an estimated 4-5 months. Gujarat is the only state standing as an exception, where the aggregate dues are less than Rs 20 crore and over only a month or two.

Four sates account for three-fourth of the Rs 9,736 crore due as of July 2019

There are fair amounts of payment defaults but these are very specific to certain states. There are three states with huge payment backlog — Tamil Nadu, Andhra Pradesh and Telangana. At the same time, there are states like Gujarat that have always been good in clearing payment, Arul Shanmugasundram, chief operating officer, Tata Power Solar Systems Ltd, said.

Nearly all major renewable energy developers are under distress due to the mounting dues. As of July 2019, 11 developers have accumulated dues of over Rs 300 crore (see ‘RE developers with accumulated dues of over Rs 300 crore’). ReNew Power, Adani Group and Tata Power Renewable Energy, three of India’s leading RE developers, are owed nearly Rs 3,860 crore for 6.4 GW of operational RE capacity. SECI, the Central government-owned intermediary off-taker, also has a large capacity of 1.8 GW affected with over Rs 600 crore due.

RE developers with accumulated dues of over Rs 300 crore (Source: CSE Analysis) DEVELOPER

AMOUNT (RS CRORE)

AFFECTED PROJECTS NUMBER

INSTALLED CAPACITY (MW)

RENEW POWER

1,832

3,335

ADANI

1,297

2,010

TATA POWER RENEWABLE ENERGY

732

1,092

SECI

609

1,875

CLP WIND FARMS

570

1,023

CONTINUUM WIND ENERGY

414

909

NLC INDIA

407

1,420

VECTOR GREEN ENERGY

359

484

VENA ENERGY

340

412

HERO ENERGY FUTURES

316

720

SEMBCORP

307

920

Three largest developers account for a quarter of the total dues There are 17 wind and solar projects that have accumulated outstanding dues exceeding Rs 100 crore each (see ‘Projects with accumulated dues of over 100 crore’). Most of these are located in Tamil Nadu and Andhra Pradesh.

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JANUARY- 2020

opinion

Projects with accumulated dues of over 100 crore (Source: CEA) NAME OF COMPANY

INSTALLED CAPACITY (MW)

AMOUNT (RS CRORE)

PPA WITH DISCOM

ESTIMATED MONTHS OF DELAY

KAMUTHI SOLAR POWER

216

442

TANGEDCO

<18 MONTHS

ADANI GREEN ENERGY (TN)

216

267

TANGEDCO

<18 MONTHS

SECI

400

244

APPDCL

<12 MONTHS

WALWHAN RENEWABLE ENERGY

149

223

TANGEDCO

<18 MONTHS

SECI

865

197

RUVNL

>6 MONTHS

VENA ENERGY POWER RESOURCES

148

170

APSPDCL

<18 MONTHS

RAMNAD RENEWABLE ENERGY

149

TANGEDCO

<18 MONTHS

WALWHAN SOLAR TN

100

148

TANGEDCO

<18 MONTHS

RENEW SOLAR ENERGY (TELENGANA)

143

141

TSPCC

<12 MONTHS

WALWHAN RENEWABLE ENERGY

100

125

APSPDCL

<18 MONTHS

SE SOLAR

100

125

TSSPDCL

VAYU URJA BHARAT

120

123

APSPDCL

<12 MONTHS

KAMUTHI RENEWABLE

119

TANGEDCO

<18 MONTHS

RENEW AKSHAY URJA

100

111

TSPCC

<12 MONTHS

CLP WIND FARMS (INDIA)

104

MPPMCL

<18 MONTHS

AXIS WIND FARMS

210

100

APSPDCL

<6 MONTHS

<18 MONTHS

17 wind and solar projects account for 30 per cent of total payment delays

Payment security measures Investments in the RE sector had flourished over the past decade after the government provided credible assurance about payments. SECI was set up in 2011 with the objective of aggregating demand and reducing off-taker risk associated with discoms. Since then, multiple mechanisms have been introduced to provide payment security in RE power purchase agreements (PPAs). Payment security mechanism (PSM) and guarantees: The government initially set up a PSM fund with an initial corpus of Rs 500 crore with SECI to cover delays in payments under three Viability Gap Funding (VGF) schemes for solar projects. In February 2017, a tripartite agreement was signed between the Reserve Bank of India (RBI), Central and state governments, for the projects bid out by SECI and NTPC under which the Central government can withhold financial assistance payments to the state governments in case of payment defaults. Some state governments have been directly guaranteeing payments to developers in case of PPAs signed directly with discoms. ERC regulations: Some state regulators have also stepped up. For instance, Tamil Nadu Electricity Regulatory Commission (TNERC) in the solar tariff order issued in March 2019 mandated the state discom to clear all payments within 60 days of receipt of the bill. The commission imposed a penalty of one per cent per month for delays beyond that, and an incentive of in the form of rebate of one per cent in case the payment is made within a month. Letter of Credit (LC): With the challenge of payment delays mounting for both conventional and RE generators, the MoP in August 2019 made it mandatory for discoms to offer generators LC through banks for future power purchases spanning from a week to a month. These LCs can be invoked in case of payment defaults beyond the 45-60 days, depending on the grace period allowed in respective PPAs. However, according to industry players, the LC mechanism is expected to bring limited relief. Indeed, the MoP guidelines for PPAs already included provision requring LCs to cover payment risk but the state govt/discoms frequently insisted that they didn’t wish to provide LC support. Even for a few projects where LCs were opened, banks/discoms often asked developers not to present the LC as they didn’t want to put the discom under pressure. Furthermore, state governments and discoms are asking the MoP to drop this requirement since the discoms are financially weak and may not be able to obtain additional LCs from banks. The MNRE is trying to introduce stricter mechanisms to ensure payment security for upcoming projects.

JANUARY- 2020

Under the latest amendment to the competitive bidding guidelines for solar projects introduced in October 2019, a payment security fund is proposed to be set up with Rs 5 lakh per MW contribution from generators. It also allows for introduction of additional risk premium of Rs 0.10 per kWh for adding to the payment security fund. However, insurance through such mechanisms can only provide comfort to investors against a risk of delayed payments over a limited time period. In a scenario where delays linger over long durations or where non-payments becomes a credible threat, made probable by the chronic inefficiencies of discoms, such funds will not help change the investor sentiment. Meanwhile, in absence of improvement in the payment scenario for existing projects, developers remain underwhelmed by the changes. “The challenge right now is of restoring investment appetite of the industry. The new guidelines will solve the problem in the future. But we must find solutions for the 30-32 GW capacity on-ground and suffering. Investors cannot be approached to fund new projects when money for existing ones is held up,” Upadhyay said.

Sunil Jain, chief executive officer and executive director, Hero Future Energies, agreed. “If I am not getting paid for an old project, how do I get the guarantee that I will get paid for power generated by new ones?” he said. Piling up of payment dues are thus among the key roadblocks in India achieving the 175 GW RE target by 2022. The increased quantum and perception of risk due to payment delays has made banks wary of lending for new projects. India Ratings and Research Private Ltd has already downgraded the rating outlook for the solar sector from positive to stable. Developers are holding on to available capital to support loan payment of existing projects, unsure of when the situation is resolved. Tenders are thus being serially under-subscribed. “Streamlining payment process for the existing projects is extremely crucial. Otherwise, there would not be enough capital to invest in new projects,” Jain pointed out. The developers participating in recent tenders are usually the ones with deep pockets. The government may have concrete plans for timely launch tenders, but actual auctions will remain doubtful until the payment delay challenge persists. While risk mitigation through stricter enforcement of provisions such as LCs or through creation of payment security funds may help, these need to be backed by serious penalties for violation. Also, the government must address its root cause — discom inefficiency — through bold structural reforms targeted at improving financial viability of the distribution segment. This is critical not only for the immediate 175 GW goal, but also for the longerterm vision of 450 GW of RE. This is the first in a series of articles on India’s renewable energy quest

Source: downtoearth.org.in

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ROOFTOP & OFFGRID

Solar Rooftop: Tapping the vast potential to meet 100 GW target

India has almost reached 10% installed capacity with renewables in November 2019. Solar power has reached grid parity and is the cheapest source of distributed power across the world. While evacuation, policy and installation quality are some of the common problems plaguing the Indian solar push, the 100 GW target is not far. The centre has been upward revising renewable targets every few years. Major research agencies have also deeply underestimated the renewable capacity addition over the last 10 years. India has still not realised its potential for renewable energy addition fully.

he major stakeholders in the solar sector – Consumers, system integrators, suppliers and financing institutions – have all risen up to the opportunity. The consumer is becoming increasingly aware and can easily connect the dots in a previously ambiguous topic. Utility scale solar plants have been the low hanging juicy fruits for investors and policy makers but distributed generation is the clear way forward. Solar as a technology is ideally adapted to the distributed concept. Add storage to this topic and we have a robust solution which will be unchallenged for a few decades. The transport sector is being revolutionised in parallel with electric vehicles (EV’s) being deployed at a fast pace. EV’s are a natural partner of distributed solar. Solar industry experts constantly encounter a disconnect between policy and technology. If that was not enough, the DISCOM’s are not receptive to change (barring a few states). Some changes, like the recent notification on making the AC capacity of a solar power plant as the primary capacity metric, is a welcome one. The renewable voice is growing louder among all stakeholders. DISCOMS have the additional advantage of using their distribution transformer capacities more efficiently by enabling small scale distributed power producers. DISCOMS have to become an active player in helping to deploy distributed solar. India has one of the highest power transmission and distribution loss metrics in the world. Distributed generation solves this issues with the common point of generation and consumption. Many state governments have taken a short sighted view and are facing a ‘buyer’s remorse’ in a falling capex market. This has led to investors being harassed for renegotiation. The control over historical contracts needs s desperate improvement for this growth to sustain. India also needs to move from a power producer to a raw material producer. The manufacturing capacity of all solar system components has not grown and India is a laggard in this matter. Though improvements have been going on over the last 2-3 years, China’s prowess has been unmatchable in this regard.

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Solar and subsidy have been going hand in hand since the very beginning due to the high initial costs. Today, unsubsidised solar has reached grid parity or dare I say, become a no brainer for industries to adopt as a long term low risk investment with a cushion against rising electricity costs. Capital subsidies are no longer needed in the industry and the subsidies, if any, should be higher in the value chain like manufacturing. Uneven and constantly changing state policies have created confusion in a market which is already technologically unclear in a consumers mind leading to a rampant decision paralysis. System integrators have to bear the brunt of this since their sales lead cycled and business development costs skyrocket. A single centrally controlled policy will immensely help the industry. Insufficient land or roof area are another issue which every consumer faces. Improvement in plant efficiencies over the last 10 years have been significant in ensuring that the kWh generated per square feet keep improving. When we started with installing Thin Film Modules of 100 Wp each, they were state of the art. We have come a long way today with 400 Wp becoming the new normal now. This is direct 4x jump on the land use efficiency in 10 years. With commercially viable bi-facial technologies around the corner, this number will jump to 500 Wp within 12-18 months. A higher Wp per Square foot has an added advantage of reduced Balance of System costs. Emerging technologies like storage have to be adopted early in India and manufacturing for the same has to be started early. Battery storage needs another few books to be given justice. The next revolution in renewables will be in the storage segment and by 2022 storage is slated to be the enabler for the next 100 GW of renewables in India. Distributed generation and storage will change the way people depend on the grid for their everyday power needs. Energy independence will become a new norm. The next stage is research and Development on the system components so that India always stays ahead of the curve and is not merely a reactionary market. Potential in any industry is directly correlated with the population of the region. India’s young and energetic population will adapt to and digest this new technology in no time. Recent studies by international research agencies have declared India to be the cheapest solar market of the world. We hope this does not lead to India being perceived as the lowest quality market in the world. The transition from a cool to prudent technology has been great till now. Its time to make this from prudent to dependable over the next 5 years.

Author

Punit Goyal

Co-Founder SunAlpha Energy Pvt. Ltd.

JANUARY- 2020

opinion

‘India needs tariff reforms to boost consumption of renewables’ India needs to reform its tariff regime to reduce dependence on discoms and bring new electricity procurement models to boost consumption of renewables by commercial and industrial (C&I) consumers, according to an industry expert. As per a report by WWF-India, C&I consumers account for 51 per cent of the total electricity consumption in India, which is equivalent to 1,130 TWh per annum.

Concerted government action is required to grow penetration of renewable power for these consumers. There are two broad areas of action required. First, we need tariff reform to reduce financial dependence of discoms on C&I consumers. Second, new procurement models need to be enabled, said Bridge to India MD Vinay Rustagi at a CII event here.

WF-India report ‘Global Corporate Renewable Power Procurement Models: Lessons for India’ was also released at the event. According to the report, C&I consumers’ power demand is met principally by grid power (63 per cent) and onsite captive generation (27 per cent, mostly coal fired). Only 4 per cent is met by long-term open access (OA) sources. C&I consumers’ share of direct RE (renewable energy) procurement including rooftop solar is estimated at only 3.2 per cent for fiscal 2018. However, this 3.2 per cent procurement of clean energy excludes combined supply of renewable and conventional power by discoms.

Many corporates have been proactive and announced voluntary carbon mitigation targets, along with increasing their renewable power consumption, Ravi Singh, Secretary General and CEO, WWF-India said. “Consumption of renewable power cannot only make C&I consumers cost competitive and spur macroeconomic growth, but also play a significant role in reducing India’s carbon emissions,” Singh said.

As part of a stronger Climate Action Plan, India has committed to increase renewable power capacity target from 175 GW in 2022 to 450 GW by 2030. Greater adoption of clean energy by C&I consumers is critical for meeting these national renewable energy and climate change commitments. The report also said captive coal-fired capacity in the country is estimated at 52,933 MW and combined share of renewable power in their consumption mix is likely to be only 10.5 per cent. With renewable power costs falling rapidly, C&I consumers have a very strong financial incentive to switch to clean energy. They can not only make attractive savings of around 30-60 per cent on grid power, but also reduce carbon emissions and comply with renewable purchase obligations, the report suggests. Currently, the avenues available to C&I consumers to procure renewable power are limited to rooftop solar installations, open access solar and wind power, and RECs (renewable energy certificates). However, even these options are not freely available because of various policy and market constraints. With the growing C&I renewable power market worldwide, many new alternative procurement options have opened up. Virtual power purchase agreements, green tariffs, internationally tradable RECs (I-RECs) have already been successfully tried and tested in many countries. There are also proposals to set up dedicated renewable power exchanges and facilitate peer-to-peer (P2P) trading, the report added. Source: PTI

JANUARY- 2020

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POLICY & REGULATION

New Solar Policy giving thrust to Electric Vehicles & Component Manufacturing: Rajasthan Solar Association

19 December 2019, Jaipur – Hon’ble Chief Minister Shri Ashok Gehlot launched the new “Rajasthan Solar Energy Policy, 2019” and “Rajasthan Wind and Hybrid Energy Policy, 2019”. Target of 30,000 MW Solar Power Projects up to 2024-25 as under: Utility/Grid Scale Solar Parks-24,000 MW Distributed Generation 4,000 MW Solar Rooftop 1,000 MW Solar Pumps 1,000 MW.

Electric Vehicles Promotion: Government land at 50% concessional rate of DLC for first 500 renewable energy based EV charging stations. 100% exemption in normal transmission and wheeling charges for a period of 10 years 100% electricity duty consumption for 7 years

Government announced to develop 33 district headquarters as ‘Green Energy Cities’ -district headquarters in next 5 years by installing 300 MW of Solar Rooftop Systems. It is a very positive move. CATEGORY

WHEELING CHARGES & TRANSMISSION CHARGES

Captive use-Solar Power Projects outside the premises of consumer of Rajasthan

@ 50% of normal transmission and wheeling charges for a period of 7 years

Solar Power Projects @ 50% of normal transmission and set up for sale of power wheeling charges for a period of 7 years within State through open access Projects with Storage Systems for captive use/ third party sale

25% of normal transmission and wheeling charges for a period of 7 years from date of commissioning of the project.

The charging station captive use & open access within the State

@ 100% exemption in normal transmission and wheeling charges for a period of 10 years

Manufacturing of Solar Energy Equipment: Concessions Benefits of Micro, Small & Medium Enterprises (MSME) Policy to eligible manufacturers. Land allotment at 50% concessional rate in industrial area/any other area.

Exemption of 100% Stamp duty Full exemption in Electricity Duty for 10 years. Investment subsidy on SGST to solar energy equipment manufacturers: 90% of SGST due and deposited for 7 years. Employment Subsidy as per RIPS: Reimbursement of 90% of contribution paid for employees for 7 years. Interest subsidy as per RIPS, treating solar energy equipment manufacturing as thrust sector. Benefits such as banking facility and payment of surplus energy under Net-metering Scheme for domestic consumers will also be applicable to Government buildings. Rooftop PV Solar Power Systems with Gross Metering are allowed up to 1 MW capacity. Appropriate provisions would be made in Urban Building Bylaws to promote and facilitate use and installation of Solar Rooftop Systems. State willpromote setting up of decentralized solar power projects with a minimum capacity of 0.5 MW and maximum capacity of 3 MW in for 33 kV Grid Sub-Stations for sale of power to DISCOMs. Banking:Banking of energy at the drawl end within the state shall be permitted for captive Consumption and third party sale on yearly basis. Banking charges shall be adjusted in kind @ 10% of the energy delivered at the point of drawl. The banking year shall be from April to March. Exemption/Relaxation from Electricity Duty:The electricity consumed by the Power Producer for captive use within the State will be exempted from payment of Electricity Duty for 7 years. Solarisation of Stand Alone Mini Drinking Water Supply Systems in Rural Areasusing solar pumps

“New Solar Policy has clear message that MSME has important role in development of solar in Rajasthan. 4000 MW of small solar projects will be setup in Rajasthan in next 5 years which will be a great boost to entrepreneurship skills of Rajasthan. Rajasthan should fulfil their RPO only by small solar projects. “ Sunil Bansal, General Secretary, Rajasthan Solar Association

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JANUARY- 2020

RESEARCH & ANALYSIS

India needs to de-risk private sector investments, develop suitable carbon pricing instrument: PwC India can consider developing a robust domestic emission trading system where the private sector participates and sells retroactive, current and future credits, according to global consulting firm PricewaterhouseCoopers (PwC). Besides, there is a need for continued efforts to de-risk and encourage private sector investment in low-carbon technologies, it said in a report titled ‘Shades of Green: Reflections on COP25.’

he 25th Conference of the Parties (COP) — the annual meeting of the signatories to UN Framework Convention on Climate Change (UNFCCC) — concluded recently at in Madrid in Spain. While signatories deferred the decision on the emissions trading system, they re-emphasised the need for enhanced emission reduction targets from all countries. For India, said PwC, risks may arise owing to cancellation of tenders, import duties, land acquisition-related uncertainties. Policy interventions (for example standardisation of bid criteria) and financial instruments (for example loan guarantees) are required to ensure increased private sector participation. For the retroactive credits, a suitable cut-off may be decided upon review of the vintage of the available credits in the market vis-a-vis the Nationally Determined Contribution (NDC) commitment period. However, going by past experience, market regulations need to be stringent enough to ensure good quality credits and prevent market saturation. Quality of credits may be ensured based on the principles of additionality and sustainable development. India has so far experimented with different mechanisms such as carbon tax, perform achieve and trade scheme besides the renewable energy certificates. None of these yielded the desired results.

“The existing mechanisms and inherent challenges may be critically reviewed and a cross-sectoral trading mechanism may be developed in which private sector companies that are interested in investing in clean energy, climate-smart agriculture and waste to energy may participate effectively,” said the report. Indian companies (barring a few service sector companies) have not yet started identifying climate change risks and acting upon them. A policy instrument is required that will prompt private sector companies to start disclosing as per the Task Force on Climate-related Financial Disclosures (TCFD). One such instrument can be the inclusion of TCFD recommendations in the Securities and Exchange Board of India (SEBI) guidelines for business responsibility reports, said PwC. In all likelihood, said PwC, Article 6 will not allow Clean Development Mechanism (CDM) credits to be transferred under the Paris Agreement regime. In such a scenario, India will stand to lose around 400 million accrued credits under CDM till 2020. This will have significant financial implications on the country’s private sector, which invested heavily in the implementation of CDM projects in India. In the post-2012 era, prices of Indian credits have gone down significantly, but private sector players have been able to recover their costs by transacting in the compliance and the voluntary markets even if that may not have generated revenues.

JANUARY- 2020

Now if the credits suddenly lose their values that may cause a setback. More importantly, in such a scenario, the private sector will lose faith in market mechanisms, said PwC. India, China and Brazil have maintained their stand that the developed nations need to take up responsibility for shortfall in their targets in the pre-2020 era and bridge the gap by setting more ambitious targets. As per the Carbon Budget Report 2019, emissions in China, India and the United States increased the most in 2018. In 2019, China’s emissions continue to increase, India’s is less, while emissions in the United States are down. The Paris Agreement aims to limit global warming to less than two degrees celsius (maximum limit) and aspires to curb the rise in temperature to 1.5 degrees celsius. Under the pact, each country voluntarily determines its own contribution to reducing emissions in order to mitigate global warming by disclosing its plans and regularly reporting progress on execution of the plans. Source: ANI

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POLICY & REGULATION

Delhi Electric Vehicle Policy 2019 BACKGROUND The draft Delhi EV Policy was put in public domain for inviting comments and suggestions on 27.11.2018 in response to which wide-ranging suggestions were made by various stakeholders including international and national think-tanks, non-profits, experts from academia, EV manufacturers, battery manufacturers, multilateral bodies, and concerned individuals. A day long Stakeholder Consultation event was also held on 18.12.2018 by the Dialogue & Development Commission of Delhi (DDCD). The consultation was inaugurated by Hon’ble Chief Minister and Hon’ble Minister Transport, and saw in-depth discussions from over 200 participants from across the country on thematic areas such as charging infrastructure, two-wheelers, three-wheelers, industry perspectives and citizen perspective on the draft Delhi EV policy. On 26.06.2019 and 27.06.2019, Delhi government organized the Urban Mobility Lab in Delhi with a special focus on identifying obstacles and collaboratively designing solutions to enable innovative start-ups in e-mobility space take off in Delhi. Based on the various comments and suggestions received through the above multi-staged process, and keeping in mind the developments in FAME India Phase II scheme at the national level, the final draft of Delhi EV policy 2019 was prepared.

GOAL and IMPACT The primary goal is to improve Delhi’s air quality by bringing down emissions from the transport sector. To do so, this policy will seek to drive rapid adoption of Battery Electric Vehicles (BEVs) such that they contribute to 25% of all new vehicle registrations by 2024. The policy particularly focuses on electric two-wheelers, shared transport vehicles (e.g. three-wheelers/buses) and goods carriers/ freight vehicles, since they contribute to majority of the vehicular pollution. Currently, electric two-wheelers constitute to only 0.2% of annual two-wheeler sales, electric cars contribute to 0.1% of car sales and the sales of electric three-wheelers (autos/goods carriers) are almost NIL. Within a year, Delhi government is targeting the induction of 35,000 electric vehicles (2/3/4 Wheelers and buses), 1000 EVs for last mile deliveries and 250 public charging/swapping stations to come up in Delhi. In the next 5 years, Delhi government is targeting to put 5 lakh new EVs register in Delhi due to this policy. Over their lifetime, these EVs are estimated to avoid approximately Rs 6,000 crores in oil and liquid natural gas imports and 4.8 million tonnes of CO2 (carbon dioxide) emissions, which is equivalent to avoiding CO2 emissions from nearly 1 lakh petrol cars over their lifetime. They will also help avoid about 159 tonnes of PM 2.5 (fine particulate matter) tailpipe emissions. Delhi government’s vision is to make Delhi the EV capital of India.

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Following are the key provisions under Delhi Electric Vehicle Policy 2019:

TWO WHEELERS Purchase incentive of ₹5,000 per kWh of battery capacity. For an average e-two wheeler with 2kWh battery, applicable incentive would be approx. Rs 10,000 as compared to Rs 5,500 presently being offered by DPCC as subsidy for battery electric vehicles. Scrapping incentive of up to Rs 5000 to be offered subject to evidence of matching contribution from the dealer or OEM. For the first time in Delhi, ride hailing service providers will be allowed to operate electric two wheeler taxis, which will be a big boost to clean last-mile connectivity. All two-wheelers engaged in last-mile deliveries (e.g., food delivery, e-commerce logistics etc.) will be expected to transition 50% of their fleet to electric by March 2023, and 100% of their fleet by March 2025.

ELECTRIC AUTOS (E-AUTOS)/E-RICKSHAWS/E-CARRIERS Purchase Incentive of ₹30,000 per vehicle (NIL at present). Interest subvention of 5% on loans and/or hire purchase scheme for the purchase of an e-auto. So a loan of typically 12% interest from DFC will now be made available at 7% - the lowest anywhere in India for EVs. For E-autos, open permit system will apply for individuals who will be given permits on a first-come-first basis, subject to the cap of maximum number of autos permissible in Delhi as per SC orders. E-Carriers will be completely exempt from the prohibition on plying and idle parking of lights goods vehicles on identified roads of NCT of Delhi during specified timings.

FOUR WHEELERS (E-CARS) Purchase incentive of ₹10,000 per kWh of battery capacity for first 1000 cars subject to a cap of Rs 1,50,000 per vehicle All leased/hired cars used for commute of GNCTD officers will be transitioned to electric within a period of 12 months from the date of notification of this policy

BUSES Subsidy as decided by GNCTD from time to time with a commitment that pure electric buses shall constitute at least 50% of all new buses (including smaller buses for last mile connectivity) to be added to the city bus fleet.

ACROSS ALL VEHICLES All financial incentives will be applicable for both fixed battery models and swappable battery models. Delhi EV policy is technology agnostic and encourages innovation in all technologies. Road tax and registration fees to be waived for all Battery Electric Vehicles during the period of this policy.

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