Economy

New hybrid RE policy to give project cost, infrastructure advantage

Our Bureau New Delhi | Updated on May 15, 2018 Published on May 15, 2018

But norms for sale of hybridised power generated from existing projects awaited

Clean energy projects in the country are set to gain in terms of cost savings on land acquisition and evacuation infrastructure under the National Wind-Solar Hybrid Policy.

The policy also allows the existing wind farms to expand their portfolio and add solar PV capacity and vice versa provided they have 25 per cent installed generation capacity of the other source. This is something that has particularly enthused the sector players as they can lower costs and raise generation at their existing project sites.

Senior Vice-President at ICRA, Sabyasachi Majumdar, said, “Hybrid projects are likely to be competitive in tariffs compared to individual wind or solar energy projects, given the benefits associated with hybrid projects — mainly in respect of lower capital cost, optimisation of transmission infrastructure and higher generation expected.”

Majumdar estimates that land and evacuation network for wind or solar project account for about 10-12 per cent of the overall project cost.

The generation profile will also be relatively higher than standalone wind or solar project, with lower variability in generation profile to some extent, given that generation from both the sources is at different intervals and in complementary seasons. This, in turn, would partially address the concerns of distribution utilities over the grid stability arising due to the intermittent nature of wind or solar, he added.

But, the policy alone cannot give them this benefit. Vivek Sharma, Senior Director, Crisil Infrastructure Advisory, said: “The Central Electricity Authority and the Central Electricity Regulatory Commission will have to come out with norms that can allow the sale of hybridised power generated from existing projects.”

“There needs to be clarity on how Power Purchase Agreements will be reworked in case a project decides to add another generation source. The project developer will definitely want to gain better margins by lowering generation costs and increasing volumes. It is also to be seen if the renewable purchase obligation will be extended for these projects,” he added.

Published on May 15, 2018
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