Balancing Power Between Coal Fired And Renewables – Economics

Table of Contents

CURRENT AFFAIR

The Ministry of New and Renewable Energy recently proposed ‘reverse bundling’ scheme for balancing between coal-fired power and renewable

In 2015, the government had come up with a plan to ‘bundle’ solar energy with the then cheaper coal generation
The idea was to push sales of renewable power through a market-driven approach

A new proposal now seeks to flip the ‘bundling’ scheme by using cheap renewable energy to subsidise costlier coalfired power
Under ‘reverse bundling’, “high cost thermal power’’ is bundled with cheaper renewable energy to overcome the ‘intermittent-ness’ of green power
The draft policy stipulates supply of 51% renewable energy with or without energy storage bundled with 49% thermal power component

The tariff for this bundled electricity could work out to be much higher instead of a simple average of cheap renewables and costlier coal supply
This is because renewable energy can only be supplied for 6-8 hours

Coal power generators in the country are evading deadlines year after year to retrofit their plants with emission controlling systems
If thermal power is bundled with renewable energy without storage, the coal-fired capacity will have to be ramped up and down throughout the day
Otherwise, it has to be shut for a part of the day depending on renewable generation
The inability of power distribution companies (discoms) to buy enough electricity due to their poor financial health is at the centre of the tussle between renewables and coal-fired power

Electricity from renewable sources constitutes only about 10% of the country’s total generation mix
There is thus a long way to go in achieving higher green power generation
India’s coal demand is expected to grow by more than that of any other country, in absolute terms, by 2024