Mumbai: Repurposing some of Maharashtra’s oldest and most expensive coal plants by using the land and some of the old coal infrastructure for clean energy and grid stability services can deliver Rs 5,700 crore in benefits, new analysis commissioned by research organisation Climate Risk Horizons shows.
The research, by Dr Gireesh Shrimali, Head of Transition Finance Research, Oxford Sustainable Finance Group at the University of Oxford, has quantified the costs and benefits associated with retiring and repurposing 4,020 MW of old coal units at Bhusawal, Chandrapur, Koradi, Khaparkheda and Nashik.
Maximising financial gains
The report illustrates how the state can maximise financial gains from repurposing older units, gradually reducing its dependence on coal over the coming decade, in line with India’s Nationally Determined Contributions (NDCs) under the Paris Climate Accord.
“Maharashtra is already one of the leading states in India’s energy transition story. This study shows that shutting down and repurposing the state’s older, more expensive coal plants could provide a financially attractive opportunity to accelerate this transition in a way that benefits state finances,” said Ashish Fernandes, CEO of Climate Risk Horizons, which commissioned the analysis.
He added that these old coal units are near or past their end of life and have high running costs, up to Rs 6 per unit. They also need to be retrofitted with air pollution control equipment to comply with emission standards, at considerable expense.
The financial benefits of repurposing some or all of these coal plants would be between 2-4 times the costs of decommissioning, and would cover a substantial proportion of the new capital expenditure required for solar, batteries and synchronous condensers,”said Dr Shrimali. Total decommissioning costs for the units assessed was approximately Rs 1,756 crore while the one-time benefits from repurposing for solar PV with battery storage would be Rs 4,356 Cr, the study showed.
The analysis also found that while repurposing coal plants for solar PV and battery storage, if the old power plant turbo generator is also repurposed to serve as a synchronous condenser, the benefits are even higher at Rs 5,700 crore.
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