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Story of launching Renewable Energy Certificates in India and allied facts

Tuesday, May 25, 2010 0 comments

You know it feels really good when you envisage something and it really turns up sooner than later. Few days back, I wrote a story on Renewable Energy Certificates (RECs) and understanding its mechanism. RECs are imperative for reducing the payback period and it has been adopted successfully in US for the solar energy growth. Yesterday, an official from Central Electricity Regulatory Commission released a statement that RECs will be launched in August 2010 with an agreement with 2-3 seller and equal number of buyer states. The RECs will subsequently be traded on Indian power exchanges.
Initial Participants
REC Selling States
REC Buying States
·         Gujarat
·         Maharashtra
·         Rajasthan
·         Madhya Pradesh

·         Himachal Pradesh
Indian Exchanges where it will be traded
·         Power Exchange of India
·         Indian Energy Exchange
The most important aspect is still pending: Pricing of the RECs! The tentative rates for each category of RECs are:
Price Segment
Solar REC
Non-Solar REC
Floor price
INR 12,280 (USD 258) per MWh
INR 1,450 (USD 30) per MWh
Forbearance price
INR 17,230 (USD 362) per MWh
INR 3,780 (USD 79) per MWh
The biggest concern that remains: Liquidity of tradable RECs. This needs to be addressed only by the market players and speculators. I think market making should be allowed in the initial stages by the power exchanges. This can apply the same model as it is followed in US. Market makers should be hired by the power exchanges and they should trade for increasing the volume of the RECs.
This development can be a win-win situation for all the concerned entities: solar power producers, government, customers and utilities.
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Story of incentives offered for Solar Energy Projects in India

Monday, May 24, 2010 5 comments

For the past few weeks there has been many questions being raised about the incentives offered for solar energy in India. This figure above attempts to explains some of these in the leading solar states in India.
I hope this is useful.
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Story of developing public private partnerships in solar energy projects in Gujarat, India

Tuesday, May 18, 2010 0 comments

One of the most critical factors impacting the growth of solar power is availability of land. Land acquisition is one of the major issues for most of the infrastructure projects including energy. The process of acquiring land at time leads to time delays and cost overruns in most of the power projects undertaken. Now what is the solution to fast track this whole process?

1.      Government can come up with a proposal for the independent solar power producers to allocate the land based on their requirement. Obviously this has to go under bidding process along with the stringent deadlines for competition of the project within the stipulated timelines. Non-adherence can lead to penalties and exclusion from bidding in future solar power projects.

2.      Towards this, the government has to acquire the land before the proposal is been sent out. A separate cell can be made which would look into only land acquisition. The land has to be non-arable or semi-arable. The grid-connectivity should be feasible. Also in favor of the owner of the land, the land should be acquired at the current market price and not at the subsidized rate. This would give the motivation to the land owner to sell off his land too.

Now the question arises, what would government get in return?

1.      The process of the solar energy development is fast-tracked. The government owns the land and the private player is provided with a Power Purchase Agreement (PPA) for 25 years (i.e. the expected life of the solar panels). The rate same as in feed-in-tariff can also be provided which would also increase profitability of the solar power producer.  

2.      The private player has to bring in operational efficiencies as it has only 25 years to earn profits. However, the solar producer has to calculate it's return based on the panels and the initial installation costs.

3.      The government also gets hold on the Renewable Energy Certificates (RECs) which can be traded in future.

4.      Already many states such as Gujarat in India have started adopting the PPA model. But the land acquisition still remains a headache for the solar power producers. This model can resolve this issue.

This would help in bringing economic and environmental plans to a reality. Without such arrangements, the solar plan of achieving 20 GW of solar power by 2022 would be in jeopardy.  

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The story of India being front runner in development of solar energy by 2050

Wednesday, May 12, 2010 1 comments

Today it was a "warm" morning with the report by IEA (International Energy Agency) for all the solar project owners and enthusiasts in India. The finding concurred with the views expressed on solarishi.com.

1.      India after USA will be the front-runner in development and adoption of solar energy. Thanks to high solar insolation and proactive government policies.

2.      CSP and PV are expected to contribute around 11 percent each towards the solar energy's share of meeting the quarter of global energy demands by 2050. The rest (around 3 percent) will be solar heating applications. Thus, instead on looking them as competing technologies, they should be viewed as complementing ones.

The PV Story

India and China both are increasing investments in Solar PV space but China is currently leading by building large PV panel manufacturing capacity of approximately 2 GWs. On the other hand, India has around 10 fully integrated players manufacturing solar cells, solar panels and complete PV systems around 50 assemblers of various kinds. These players are able to supply only 200 MW for rural, remote area and industrial requirements. This makes China more cost competitive than India. The need of the hour is heavy support towards building up dedicated SEZs for integrated PV solar manufacturing and investments in R&D.

The CSP Story

India and China has to again face competition for investments in CSP where one company recently showcased plans to develop solar towers of capacity of 1 GW and 2 GW respectively. Gujarat and Rajasthan, the two north western states where due to high solar insolation, utility-scale CSP power plants can be established. Electricity from CSP plants as shares of total electricity consumption can increase from 5 percent in 2020 to 40 percent in these two states. There are not many India-based players which have capability to provide CSP technology and solutions.

What needs to be done to reach these targets will be discussed in subsequent stories.

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Google Invests In Wind Power Technology - Guest Post by Jack Lundee

Thursday, May 6, 2010 0 comments

Green solutions and technologies are needed now more than ever. Yet, many continue to be hard to find and implement on a broad scale. Renewable energy sources are running almost on empty, mining and drilling for fossil fuels can be dangerous and costly, and the planet is constantly reminding us that it's the one paying the price. However, there are plenty of opportunities for clean and renewable energies to be a big part of the green landscape. With the right funding and investment renewable energy technology like wind power could help turn the tide when it comes to environmental concerns.


Wind power is a clean energy system that converts the planet's own wind into energy by using mills, turbines, and even airborne kites. The earth's wind moves the mills that turn the turbines, which creates kinetic energy into electricity that then can be circulated to power thousands of homes. Up to this point, wind power has been a well-known clean energy source but has mostly been underutilized and under funded. However, with the web search company Google now investing in the technology, wind power's search to become a widespread energy source may be over.


Last Friday, Google made a sizable investment of $38 million to North Dakota based wind farms. These wind farms harness the wind energy of the North Dakota plains to create electricity that can power more than 55,000 homes and does so in a clean and safe manner. Google understands that an investment of this size, in a technology as beneficial as wind energy, can help create more wind farms around the country, create more jobs within this clean energy, and help stimulate the economy. For Google, it's as much about helping the environment, as it's about making smart business decisions about the future of this planet. Other corporations like Globetrotters Corporation (a Chicago based engineering corporation founded by C.E.O. Niranjan Shah and Hewlett-Packard are following in the same footsteps as Google. These companies are coming to the conclusion that investing in green technology and green energy is really an investment in the future of the technology, the planet, and even their own businesses.


I guess, it looks like Google realizes which direction the wind is blowing.
Note: This is the first post by our guest author Jack Lundee. A "warm" thank you to Jack for providing insights on Wind Power Technology.
Image Source: Fast Company
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