SOLAR POWER PLANTS IN INDIA

Up close on India's CSP market; CSP Today speaks to Santosh Kamath, director, KPMG, about how India’s CSP market is shaping up
Rikki Stancich, 14 January 2011 (CSP Today)

[Santosh Kamath, director, KPMG:] "…[India’s] mean temperature is different [than other CSP-rich places] – the peak in the desert areas it is up to 48 degrees Celsius…[A]verage temperatures, year-round, tend to be higher than elsewhere…In several pockets we have a haze problem…[W]ater scarcity is in issue…[like in other] CSP markets…[D]ust is a major factor…deposition on the mirrors impacts plant efficiency…[C]leaning…[requires] increased water use…[G]rid connectivity, voltage, frequency, and grid parameters in India are different from the rest of the world. So developers will be required to tune power plants to these conditions."

[Santosh Kamath, director, KPMG:] "…India has unique environmental conditions, in terms of temperature, haze, DNI fluctuations…Technology designs can be tuned…to meet [them] …[D]evelopers are looking at CSP parabolic trough and power tower – the technologies that are the most commercialized. As for CLFR and Stirling dish, it is still early days, globally…Companies like Areva are already…promoting CLFR technology, but it is a little premature to say which technologies will head the race in India."


(from Shirish Garud, TERI - click to enlarge)

[Santosh Kamath, director, KPMG:] "…The DNI is very good in the western states of Gujurat and Rajasthan – about 6kWh per, square metre, per day. So that is where the bulk of CSP…large-scale projects [will be developed]…[U]nder the National Solar programme, the power can be bought by any other state in the country…through the direct market development…[or via] a programme named ‘Open Access’, which governs the physical transfer of power from one location in the country to another…[Open Access] favours solar as there are concessions in transmission tariffs, compared to conventional tariffs. It is more cost effective to transport solar power than it is to transport conventional power across longer distances."

[Santosh Kamath, director, KPMG:] "…[M]ost power regulators in India have mandated the transmission utility to provide access to solar projects…[A] fair amount of regulation…requires transmission access to be given to solar…[T]ransmission [cost and access are] state regulated, inter-regional transfer of solar power from one part of the country to another involves several regulators…[I]mbalance charges…[and penalties for] unstable power sources [are waived for solar]…"

(from Shirish Garud, TERI - click to enlarge)

[Santosh Kamath, director, KPMG:] "…A federal programme governs the solar feed-in tariff. For every megawatt of solar power, you have 1 megawatt of conventional coal power and the two are blended in a contract…1 MW of solar costs around cost 30 cents per kwh, compared to about 0.06 cents/kWh for coal, at this ratio you get around 11 cents per kWh. The utility would pay the ‘blended’ rate, and in this way, it softens the high cost impact of solar…The approach is unique to India, and the reason it will work is because India faces a huge power deficit. If a utility is told that if it buys 1MW of solar power it will be given a megawatt of conventional power, there is a clear incentive for the utility to buy…India opted for an auction as the price discovery mechanism for its feed-in tariff…[because] there were six times the number of applications that the government could support…[T]he government has yet to officially announce how and when companies will be able to apply for these subsidies…The objective is to prove new technologies suited to the Indian market and India’s environmental conditions…"

[Santosh Kamath, director, KPMG:] "…CSP components are in many ways already being used or developed in other industries…[T]he power block is the same as your conventional power block…[T]here is a vendor base in India…[The] entire civil structure and supporting frames are similar to structures you make for transmission towers…[T]he vendor base is already there…50-70% of cost can be localized for the very first round of projects…[Some components] will be imported…Mirrors will be localized very soon, but in the first round it is likely that these will be imported."