The solar sector continues to face hurdles while accelerating towards the ambitious growth targets as cash-strapped discoms are purchasing cheaper power from the power exchanges and also on the e-auction platform resulting in curtailment issues for solar power.<\/p>\n
Some discoms are resorting to power cuts as they cannot afford to purchase power at low rates on the exchanges. The increase in renewable energy (RE) addition has caused some solar power curtailment issues in Rajasthan and Tamil Nadu where discoms have flouted the \u2018must run\u2019 status of solar power thereby negatively affecting developers.<\/p>\n
Currently, power is traded at Rs 2.40 to Rs 2.50 per unit on exchanges and on e-auction platform compared to Rs 4 to 5 per unit for solar power under the power purchase agreement (PPA).<\/p>\n
Raj Prabhu, CEO of Mercom Capital Group, said that the curtailment is still not widespread, but the issue needs to be addressed immediately before it starts to hurt investor sentiments in the sector. ”The problem is more pronounced in Tamil Nadu, especially in high wind energy density areas when wind and solar generation peak simultaneously. In Tamil Nadu curtailment is mostly due to the utility opting to buy cheaper power from the exchanges rather than paying Rs 7 per unit for solar (the state has signed PPAs for that rate),” he noted.<\/p>\n
RV Shahi, former power secretary argued that the comparison between price of conventional power and solar power is not for total price of conventional power but only marginal cost of variable charge.<\/p>\n
”This means discoms have started considering whether they should buy under PPA thermal power at variable cost of Re 1 (domestic coal) and Rs 2 (imported coal), which is an option available, or buy solar at Rs 4 or 5 per unit under must run condition. This consideration is not irrelevant keeping in view the financial conditions of discoms. Simultaneously, average overall price of thermal power, which will operate at lower plant load factor (PLF), will also increase and further burden the discoms. Even now many generators are not getting sufficient dispatch of solar power,” he added.<\/p>\n
Rajesh K Mediratta, Director (Business Development), Indian Energy Exchange Limited, opined that there is serious conflict coming from economic signals coming from framework for solar. ”We pay to solar generators at feed in tariff (FiT) for each unit generated. So, if preferential tariff for a RE generation is Rs 5 per unit, the discom has to pay Rs 5 for each unit of marginal generation. Whereas, its marginal cost of generation is zero. Therefore, we need to apply same mechanism as Germany where RE generators sell through exchanges at zero marginal cost and get paid for green premium through government common funds. Such mechanism can only mitigate problem of discoms curtailing power from RE generators,” he said.<\/p>\n","protected":false},"excerpt":{"rendered":"
The solar sector continues to face hurdles while accelerating towards the ambitious growth targets as cash-strapped discoms are purchasing cheaper power from the power exchanges and also on the e-auction platform resulting in curtailment issues for solar power. Some discoms are resorting to power cuts as they cannot afford to purchase power at low rates on the exchanges. The increase in renewable energy (RE) addition has caused some solar power curtailment issues in Rajasthan and Tamil Nadu where discoms have flouted the \u2018must run\u2019 status of solar power thereby negatively affecting developers. Currently, power is traded at Rs 2.40 to […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[132],"tags":[],"class_list":["post-85094","post","type-post","status-publish","format-standard","hentry","category-power"],"acf":[],"_links":{"self":[{"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/posts\/85094","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/comments?post=85094"}],"version-history":[{"count":0,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/posts\/85094\/revisions"}],"wp:attachment":[{"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/media?parent=85094"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/categories?post=85094"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/tags?post=85094"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}