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India Reaches 19% Share of Renewables in Power Mix

Renewables accounted for 19% of India's installed power capacity (62.5 GW) at the end of September 2017 while the total installed power capacity in the country stood at 333.5 GW. According to the figures, coal remained the leading power source with a 58% share of the power capacity mix, while renewables ranked second. The third position is taken by hydropower with a 13% share and total installed capacity of 44.8 GW. The total renewables capacity included 32.7 GW of wind, which corresponds to almost 10% of the country's overall capacity. Next comes solar with more than 17 GW and a 5% share of the total mix

Government Sets up Panel to Address NPAs in the Power Sector

The government has set up a high-level committee headed by NITI Aayog Chief Executive Mr. Amitabh Kant to address the problem of stressed assets in India's power sector, said two people aware of the matter. Non-Performing Assets (NPAs) in power generation accounted for around 5.9% of the banking sector’s total outstanding advances of Rs. 4.73 trillion, according to the second volume of the Economic Survey 2016-17 released in August. Tackling the issues that afflict the so-called stranded power assets will provide much-needed relief for Indian banks weighed down by bad loans.

Experts say that PPAs hold the key to solving the problem of 60 gigawatts (GW) of stressed assets across fuel sources. “The weak financial health of the state-owned distribution utilities has led to slow progress in signing of long-term PPAs through competitive bidding, with only 1.4 GW capacity tied up through long-term PPAs over the past three years,” rating agency Icra Ltd said in a 23 November report.

Power Ministers' Meet: States Agree on 24X7 Power for All, Direct Benefit Transfer

Power Minister Shri R K Singh said on 7th December 2017 that most of the states have agreed on 24X7 power for all, 90 per cent pre-paid meters and direct benefit transfer (DBT) of subsidies for electricity consumers across the country. "Our vision is that we want 24X7 power for all by March 2019. Now it will be a legal obligation. After March 2019, if there is any load shedding without any reason, there will be penalties except in case of technical issues or act of God," Mr. Singh said.

It was also agreed that the (distribution) losses would be reduced to below 15 per cent by January 2019. Mr. Singh said the other issue that was discussed was cross-subsidisation, as some states have 19 slabs of tariff. The power tariff will be remodelled according to the report presented by an expert committee today. He explained that the cross-subsidy would not be more than 20 per cent (the difference between highest and lowest tariff). Tariff policy provides that cross-subsidy would be brought down to 20 per cent in the first phase. It will help in reduction of tariff for a section of consumers.

The minister also made it clear to states that any tariff decided after the bid has to be adopted and power purchase agreements have to obey because that is the law.

Source: PTI, December 07, 2017

Load Shedding will be a Crime, Discoms Can't Bill You for Losses From 2019

The ethical obligation of the Discom as the sole license holder to provide uninterrupted power would now be made into an enforceable service obligation.

In a bid to end the bane of power outages even at a time of surplus production, the government will bring in a law to penalise distribution companies in the event of their indulging in "gratuitous load-shedding", Power Minister Mr. R.K. Singh said on 7th December 2017. Mr. Singh said such penalties are part of a road map being prepared by the government to fulfil its vision of providing uninterrupted electricity for all. "In line with the government's vision of providing 24X7 power for all by March 2019, a road map has been laid out. "Besides, it will be mandated that discoms cannot pass on the billing losses to consumers.

Source: IANS | December 08, 2017

SECI Floats Tender for 2,000 Megawatt Capacity Wind Energy Projects

The State-run Solar Energy Corporation of India (SECI) has floated tender for setting up 2 GW inter- state transmission system (ISTS) connected wind power capacities across the country on 'Build Own Operate' basis. It will enter Power Purchase Agreements (PPA) with the successful bidders selected based on this RfS (Request for Selection) and Power Sale Agreement with the interested Buying Entities.Under this auction, the eligible bid capacity will be a minimum of 50 MW and maximum, 400 MW. The discoms of non-windy states which require wind power to fulfil their non-solar RPO (Renewable Purchase Obligation) under respective RPO regulations will be eligible to buy wind power under this scheme. The duration of the PPAs and PSAs will be 25 years from the date of commercial operation of the projects. The last date for bid submission is January 16, 2018.The government has already auctioned 2 GW wind capacities so far in the first and second rounds this year. Wind power tariff had dropped sharply to an all-time low of Rs 2.64 per unit during the second auction by the SECI for 1 GW projects in October this year. After this third round, government has planned another round of auction of almost same capacities by this fiscal end.

Source: PTI, December 07, 2017

India Reduces Expenditure on Energy Subsidies By $15.4 Billion: Study

India reduced its energy subsidies by over $15 billion (over Rs 82,000 crore) between 2014 and 2016, a new report by the International Institute of Sustainable Development (IISD), the Overseas Development Institute and ICF India said. The total value of energy subsidies from the central government has declined substantially during this period from Rs 216,408 crore ($35.8 billion) to Rs 133,841 crore ($20.4 billion). While the decline is significant, subsidies still favour fossil fuels much more than renewables.

The total subsidies to coal mining and coal-fired electricity have remained stable to a slight decline over the reviewed years and amounted to Rs 14,979 crore ($2.3 billion) in 2016. Subsidies to renewables have significantly increased from Rs 2,607 crore ($431 million) in financial year 2014 to Rs 9,310 crore ($1.4 billion) in financial year 2016. As a member of the G20, India committed in 2009 to "phase out inefficient fossil fuel subsidies that encourage wasteful consumption while providing targeted support for the poorest."

Source: IANS, December 01, 2017

REC Trading at Indian Energy Exchange Hits All-Time High in November

The trading of Renewable Energy Certificates (REC) at the Indian Energy Exchange (IEX) touched an all-time high in the November session, with 18.9 lakh RECs being traded under the non-solar category. The number represents a 452% rise month-on-month and more than 12 times the volume traded in November, 2016. One REC, priced at Rs. 1,500, is treated as equivalent to 1,000 units of green electricity.Power distribution companies (discoms) were the major buyers to purchase REC in the November trade session. According to sources, Bihar, Uttarakhand, Maharashtra and Delhi discoms purchased the largest number of RECs. Trading of solar RECs are suspended since April due to an ongoing case at the Supreme Court.

India Presents $3.1 tn Climate Investment Opportunities till 2030: IFC

India's ambitious plans to meet its climate targets under the Paris Agreement represent about $3.1 trillion worth of investment opportunities by 2030, a report by the International Finance Corporation (IFC) said. According to IFC, a member of the World Bank Group, the sectors offering those investment opportunities are renewable energy, green buildings, transport infrastructure, electric vehicles and climate-smart agriculture. As per the IFC estimation, India's renewable energy sector that aims to install 175GW of capacity by 2022, has opportunities worth $448 billion. India aims for a 40 per cent of its installed capacity to be renewables (solar, wind, etc) by 2030.

Source: IANS, November 30, 2017

Power Finance Corp Lists Green Bond on London Stock Exchange

India's Power Finance Corporation's (PFC) has listed its first international bond in almost two decades on the London Stock Exchange to finance renewable energy projects in the UK. The 10-year dated green bond raised USD 400 million, paying a 3.75 per cent semi-annual coupon. "The funds raised will help promote renewable energy projects across the country and aid in achieving the government's target of 175GW of installed renewable energy capacity by 2022," said PFC chairman Rajeev Sharma. "The bond issuance allows PFC to access a new offshore investor base and also diversify its funding sources," he said.

The PFC said that projects eligible for the funds will be identified within its Green Bond Framework, which was drafted in accordance with the Green Bond Principles, a global set of guidelines framing the issuance of green bonds. He added that there has been an "undeniable shift" in momentum in green and sustainable financing across the world which has triggered a "green funding revolution".

Source: PTI, November 30, 2017,

Compiled By: Mr. Abhijit Kulkarni

Business Unit Head - Energy Segment

SKF India Ltd, Pune and


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