MNRE may now hold auctions only for RTC and hybrid projects

The government may now hold renewable energy auctions only for round-the-clock and hybrid projects, a move seen reducing the problem of intermittent supply and making clean power more competitive against traditional thermal plants.

“We may not do plain solar and plain wind tenders in the future. It is our plan to do only RTC and hybrid tenders. Like we have proved with the RTC tender, in the future it will be a business case for everyone (industry),” an official of the ministry of new and renewable energy (MNRE) told ET.

Power supply from solar and wind projects is inherently intermittent because both sources are not available all the time—while sunlight is available only for a few hours with varying intensity, wind velocity keeps changing.

Green energy developers in India have been supplying whatever power they generate right away to the grid, and since most have not invested in storage facility, the supply is intermittent. Continuous supply requires setting up of storage batteries, which may also increase the tariff.

Last week, MNRE auctioned a first-of-its-kind 400 MW RTC tender, where the levelised winning tariff emerged at Rs 3.60 per unit. Thermal power sector executives said this could be a serious threat to the dominance of coal-based power generation in the country.

The ministry also conducted an auction in January for a 1200 MW solar-wind (hybrid) storage project with assured peak power. Developers were asked to provide six hours of stored power. For six hours a day, they would have to provide power even when their plants were not generating it. “The levelised tariff came to 4.4. We were excited, it was a good beginning,” the person said, requesting not to be named.

“Since we are coming out with such bids again and again, we are expecting that a good market will be created for storage. This will reduce the tariff further,” the person cited earlier said.

Developers feel that although storage is needed in order to balance generation, asking all developers to generate power round the clock might not be feasible because of fluctuating load patterns.

“It’s simplistic to say we need power round the clock, so let’s make all projects do that. You have a dynamic load pattern and various generators who have various constraints and a grid operator balancing all of that. If you suddenly convert renewable energy from variable generation to round the clock, that would not solve the problem, because the load pattern is not flat,” said a solar developer, on the condition of anonymity.

The developer also said that incorporating storage is likely to drive up cost. He said “3.6 is a lot higher than it would be if it were pure wind or solar”.

In his view, a holistic approach is needed. “The government should look more holistically at the grid and say, look, here’s a challenge as we have more and more renewables, there is going to be a mismatch between generation and consumption, and what are the various tools we have at our disposal to balance that.”

The Solar Energy Corporation of India, the nodal agency through which the ministry conducts auctions, has requested developers to submit bids in June for another 1200 MW wind-solar hybrid auction which will take place later in the year.

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