Coming from the same bloodline of renewables, it becomes much more important for wind and solar to be in each other's company. But more than this, it is important for both forms of renewable energy to depend on each other to balance out energy supplies. This fact was highlighted by JP Chalasani, strategic advisor and former group CEO, Suzlon Group, during a webinar organised by NMIMS-The Free Press Journal in association with Tata Power. This session was moderated by Free Press Journal’s RN Bhaskar and Sharad Mhaiskar, Pro Vice Chancellor, NMIMS.
Below given are edited excerpts of the webinar:
Overview of wind energy
The Indian government has shown a huge interest in the renewable sector. Today, the installed capacity of renewables in the country stands at 87 GWs. However, these figures about 10 years ago would have been unimaginable.
In the past, renewable energy was a fringe player, but today it is one of the main players. Today, the total capacity of renewable energy is at 20-25 per cent and it contributes around 10 per cent to the energy basket. The renewable sector has managed to reach that level. However, the target set by the government is 175 GWs by the year 2022. But I have a personal reservation about that.
About 87 GWs has been achieved, 40-41 GWs worth of projects are under implementation phase and bidding for another 31 GWs is in the pipeline, the government is assuming that the country will be able to achieve around 160 GWs of renewable energy.
In the case of wind energy, it is 37 GWs which is 10 per cent of the total capacity. India is the world's fourth largest country in terms of total wind installations. It is the second-largest in wind capacity in Asia.
While wind energy has been a leader all along, solar energy has been growing at a faster rate in the last few years. It is not wind versus solar but it is wind plus solar. I strongly believe that neither can solar energy survive without wind nor can wind survive without solar.
Of the 175 GWs target set for renewable energy, it is estimated that 60 GWs is the target set for wind energy — only 37 GWs has been achieved, 9 GWs is under implementation and 3 GWs is under a bidding process. The government is optimistic about reaching around 48 GWs (and not the 60 GWs as per the target set).
Challenges and opportunities in the air
There has been a significant change, mostly in the case of technology (in the renewable energy space) in the last few years. Today, the size of wind turbines is around 3.3 MWs, (until recently it was 1.5 MWs but it has evolved).
Not just sizes but hub heights play an important role too. Now, we are talking about 140-160 metres of hub heights. Such heights improve the efficiency of the sites — so low potential sites will actually become high-wind potential sites. These technological changes have improved efficiency in the wind energy sector. This has led to a reduction in the cost of the tariff.
There is one element in the turbine which is hardly understood and that is operational maintenance services. Today, in the case of operational maintenance services, 97 plus per cent machines are available. This was not the case a few years ago.
Yet another area that was explored in the wind sector was the digitalisation of the service business. So, there is constant innovation in the service business as well.
On the commercial side, we moved to the bidding process. Adding to it, was the significant change in the profile of customers. It was usually retail and captive consumers. Today, there are large utilities, foreign and domestic among others, who are our customers. There is a whole new change in the gamut of the wind sector.
The significant challenge is that which revolves around capacity addition. It has substantially slowed down in the last few years in the wind sector. In FY 2017, which was the last year of the feed-in tariff, we as a country added 5.5 GWs in one single year. However, three years put together — FY 2018, FY 2019 and FY 2020 — we have done less than that. The capacity addition has slowed down and that is one of the problems.
Moving away from feed-in tariff to the bidding system, was a challenge. We also faced challenges in terms of land acquisition or connectivity among other things. This is because the bidding process moved from the state level to the central level, where the only parameter for bidding is the tariff. So, every player wants to set up a project where there is a highway. There was a huge demand seen in Gujarat. So, there was a rise in the price of land in certain areas, following which the government intervened and changed the rules which impacted the (viability of) projects. This move led to many projects getting stalled. I do not see a significant ramp up happening in the near future in this sector.
Most of us are facing challenges in making this transition from feed-in tariff to competitive bidding. Unlike any other sector, we are into bidding wars. The industry bids at low tariffs without evaluating (it carefully to determine) if it is really sustainable or not. So, the country is plagued by the issue of low tariff in addition to other issues that are hurting the sector.
This led to additional woes wherein states with a significantly high number of power purchase agreements (PPA) started looking at ways to wriggle out of the PPAs. This led to contractual issues in addition to attempts to reduce power consumption. As soon as the tariffs changed, the sector got into multiple issues.
Another challenge the sector faced was integrating with the grid. As renewable energy contributes about 10-11 per cent in the energy basket and is 23-24 per cent of the capacity, then you need to be part of the grid discipline. Unlike conventional energy, renewable energy faces the challenge of maintaining that discipline. So, scheduling and forecasting is easy in the case of conventional energy, but not possible in the case of wind energy largely. To achieve this, there is a need for planning with many other organisations like Power Grid, Central Electricity Authority (CEA) among others. It has to be noted that all these authorities come under the Ministry of Power and not under the Ministry of New and Renewable Energy (MNRE). That complicates the demand for coordination.
Power is an intricate sector. And MNRE lacks understanding of this sector. Thus, the integration of the power sector with renewable energy still needs to be done.
Solar or wind alone cannot sustain on a long-term basis. Both have to marry. It cannot be either wind or solar but must be solar plus wind.
Wind energy, like solar energy, prefers decentralised distribution for rural India. Yet another area that can be looked at is repowering.
Consolidation ahead
Consolidation will happen across the sector. In the next eight years, globally there will be only three OEMs (in the wind sector) who will enjoy 90 per cent of the market share, according to a report. This will be driven by the pressure to become efficient and adopt cost-cutting measures. Therefore, too many players cannot survive. This will come as a huge opportunity for companies who come with deep pockets for consolidation.
Atma Nirbhar wind energy of India
The wind sector meets all the criteria of Make in India. Wind power accounts for nearly 10 per cent of India's total installed power generation capacity. India can actually become a hub for exports not just for wind turbines but also for component manufacturing. There is a huge amount of capacity there.
As far as the wind sector is concerned, it was always made in India. We should encourage more exports. However, in the case of solar, there is a set of challenges (it still depends on imports). However, if the country is mulling on becoming self-reliant, then the industry will work towards achieving it.
