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Concentrated Solar Power in India: How Government Policies Can Help Ensure a Secure Energy Future

Anjali Jaiswal

Posted October 11, 2012 in Curbing Pollution, Green Enterprise, Moving Beyond Oil, Solving Global Warming

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After experiencing the world’s largest blackout this past summer, India is urgently searching for ways to improve the stability of its electric grid. Hundreds of millions of people need affordable electricity in India, and businesses and other institutions are looking to the government to ensure reliable electricity in rapidly growing cities throughout the country. Released just today, a new NRDC report shows that concentrated solar power, a specific-type of solar energy system involving mirrors and concentrated solar light, could be a key tool in achieving a secure and diversified energy future for India.

From energy efficiency to clean energy sources like solar power, the Indian government is taking significant steps to spur new clean energy industries and ensure reliable electricity into the future. Today’s report, released in partnership with the New Delhi-based Council on Energy, Environment and Water (CEEW), follows the progress of one of these industries, tracking concentrated solar power (CSP) projects over the last two years.

NRDC-1617 India Solar ThermalTHUMB(1).JPG

Under the country’s ambitious solar program, the National Solar Mission (NSM), India has jumpstarted its solar energy industry, fostering growth in both photovoltaic (PV) projects and CSP, also known as solar thermal. Before the Mission began, CSP projects only provided 8.5 megawatts (MW) of energy. Two years later, the large-scale CSP projects now underway in India will provide a projected 500 MW of clean, reliable energy under the NSM. Given the short time frame of the Mission, these numbers are impressive. In a matter of just a few short years, solar in India has gone from a small market to a significant provider of renewable electricity. And there is even more untapped potential just around the corner.

But India has a long way to go in fostering a sustainable solar energy market.

Unlike traditional solar panels, CSP projects involve systems of mirrors that concentrate a large area of sunlight onto a small area of contained liquid. The liquid heats up, emits steam, and a turbine and electrical power generator convert the steam to electricity.

 Pilling 1.jpgGrid-connected CSP project currently being constructed under the NSM. Photo used with permission. 

This means that in the future, CSP could facilitate electricity storage, rather than energy available only when the sun is shining.  As a result, large-scale CSP could provide several potential benefits for India’s energy mix. CSP would help India meet its base-load energy needs, and could be called upon for supplemental electricity during times of peak usage. All this contributes to greater grid stability, meaning that CSP could help avoid another colossal blackout like we saw this summer, when trains stalled, businesses ground to a halt, and more than 680 million people went without power around the country. It is important to note that steps are being taken internationally to integrate other forms of solar into the electrical grid to provide more constant sources of energy as well.

But as India enters the second phase of its National Solar Mission, the CSP sector has some serious hurdles to overcome, as Dr. Arunabha Ghosh and I discuss in today's Business Standard.  There’s a high initial capital cost associated with CSP, making it hard for projects to get off the ground. Because of a lack of information, investor confidence is shaky in the CSP industry. And, currently, the majority of CSP projects are facing delays and struggling to meet their commissioning deadlines.

In our new report, NRDC and CEEW provide important recommendations for the Indian government and stakeholders to address these challenges and ensure the long-term feasibility of CSP. Here are a few of the recommendations. You can find the complete list here

  • Develop a Clear Roadmap: To reach India’s Phase 2 targets for solar power production, the solar sector needs long-term signals about the direction of the market, policy priorities, and support measures. India’s Ministry of New and Renewable Energy (MNRE) can help ramp up India’s solar mission by laying out a clear roadmap for Phase 2, without locking in one technology. MNRE could continue to foster both CSP and PV technologies by evenly allocating contracts for power produced between the two technologies, or devise a new form of allocation – thus providing market confidence and ensuring diverse energy resources thrive in this critical stage.

  • Increase Transparency: MNRE should increase information made publicly available on the bid selection process, the status of project commissioning, and power being produced. Other government agencies can assist in increasing transparency by developing case studies on existing CSP projects, to highlight their financial viability and encourage new players to participate in the market. The market for renewable energy is changing quickly and more real-time information will help develop a track record and build confidence in the CSP market. 
  • Investigate Delays and Monitor Timeline Extensions: Phase 1 projects are struggling to meet deadlines, and the government should enforce commissioning timelines for Phase 1 to avoid setting a precedent of leniency. Looking ahead, the government should help develop more realistic timelines for projects, taking into account foreseeable causes of delay, and determining which unforeseeable delays merit deadline extensions. Perceptions matter for investors and meeting deadlines on time is a key factor that will shape investor perceptions of CSP viability in India. 
  • Facilitate Innovative Financing: In order to attract CSP investment, MNRE should help develop financiers’ comfort with nonrecourse project financing, such as government-backed loan guarantees. The government should also work with the Indian Banks’ Association (IBA) to share information on the sector’s track record, and reduce doubt among investors using CSP-knowledgeable engineers in an advisory role. 
  • Enforce Renewable Purchase Obligations (RPOs): The Indian government should continue to analyze effective approaches to enforce renewable purchase obligations (RPOs), the renewable energy mandates that energy distribution companies in India must meet. One option could include requiring states to deliver RPO enforcement policies as a condition for receiving funds from the central government. 
  • Offer Incentives for Innovation: The Indian government should offer incentives to project developers to adopt storage technologies and water-efficient CSP plants, in order to fully exploit the potential of CSP technologies. 

It’s critical that under Phase 2 of the Mission, the Indian government not force a false choice between CSP and PV technologies. Instead, the government should continue to implement policies that support a diverse energy profile, with both CSP and PV projects playing a part. This will help ensure reliable and affordable electricity for the Indian people, while creating exciting new business opportunities for domestic developers, manufacturers, and suppliers. 

With financiers searching for clear market signals before they further invest in CSP, the Indian government has a historic opportunity to implement smart policies that develop India as a global leader in CSP technologies. 

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Comments

xed1Oct 11 2012 03:52 PM

Concentrated solar can be part of a complete industrial scale system. See http://solarphotonpower.com for an example of how this can work if there is political will to succeed.

Paul Felix SchottOct 11 2012 04:59 PM

ELECTRIC HYBRID VEHICLES & ELECTRIC VEHICLES SOON TO OUT SELL ALL OTHERS

Energy has driven the world for over a thousand years Wind, Hydro and Solar are the oldest forms of energy giving power to all smart enough to use it.

In the last 200 years Coal, Oil and Nuclear has given energy to many worldwide and great power and wealth to only a few. At the cost of many lives in coal Mines, Oil Spills, Radiation, Cancer and Polluting the Air and Water on all of the Earth.

Unfortunately for the wicked there is not an unlimited amount of oil on earth. Just the same as the Forest Trees that clean the air and make Oxygen we breath and all living on earth need to Live. As some in denial are not able to recognize or ever see or live with blinders on.

Doctors and Drug ceo's have been making millions prescribing drugs to many that live near or by High polluted areas that hurt breathing our lungs and harm our children and all. That we all pay for. When all they need is Clean Air and Water, and Clean Cities.

Now common sense would be for all to look for a clean fuel Wind, Hydro, Geothermal and Solar. Renewable Energy is eliminating the need for Dirty Energy Worldwide at a record pace. With Solar Energy Clearly the front runner.

To the fear of some of the richest people on Earth. They to surprisingly are doing
something extraordinary investing in Solar Energy. After years of many of them trying to under mine it.

Fuel that makes energy to ship goods, or make electric for homes and manufacturing. Can transform whole nations into prosperity and wealth or poverty and economic hardships for most all. Just as taxes on taxpayers has done. For over two thousand years. Making slaves of many to the wicked and unjust few. History Lesson Roman Empire, Persian Empire now OIL Empire oh sorry OPEC.

The Freedom to get your own Power from the Wind and Sun, Solar Energy has been there for years. Are Libraries and Schools should have been the first to have gone Solar and Renewable Energy. And why are they not? Churches are all over the Planet. They are going to Solar Energy.

Thank GOD for the Pioneers like John Schaeffer that Started Real Goods The first and Best catalog for Renewable Energy and Scientist Bill Young at the FSEC Florida Solar Energy Center and Monica D. Key Lindbergh for many years wrote to legislators promoting Solar and Renewable Energy and many others.

These Pioneers helped put Wind, Solar And Renewable Energy in the Spotlight for all the World to see. One of The Greatest Scientists ever Albert Einstein Stared it with a Dream that the day would come that all the World would use Solar Energy. His many years of work with the law of the "Photoelectric Effect", and showing this to the World won him the Nobel Prize in Physics. For the "Photoelectric Effect"
Free Energy From the SUN in the heavens above.
We still do not teach this to our young.

Very soon Hybrid Vehicles and (EV's) Electric Vehicles will out number the ones that need oil and gas to go. With the ability to recharge them at home and work from the sun.

Tesla Motors with its new Model S electric sedan, will be one of many the World will see soon. Honda, Nissan, Audi,VW, BMW and Volvo are just some of the Car Companies putting into production Electric Vehicles a EV, and many more are and many are building Electric / Hybrid Vehicles. The DeLorean Motor Company will be putting into production by 2013 a DMC-EV Electric DeLorean, that will have a body and power plant that will last you a life time. Just think you can recharge them at home and work free from the sun Solar Energy.

The Lord's Little Helper
Paul Felix Schott

Now to own a car that will never rust way and runs on the power from the sun that's the one for me. Very soon most all on earth will be able to get energy by recharging from the sun and wind.

ArvindOct 11 2012 10:57 PM

Very nice article - thanks Anjali.

Though thinking through large scale centralized projects have their own problems. A good solution would be to have solar on top of your own roof in India.

Also, concentrated solar power needs to constantly track the sun (with constant maintenance required) - not an install and forget solution as with systems with no moving parts.

Solar water heaters are of course a no brainer in India - and many houses already have them.

Nowadays, we are getting solar panels for under $1 per watt - which if just laid on roofs of homes will pay for themselves within 5 years in India. Power cost in Bangalore for example is Rs 4 per unit (average slab residential) and Rs 10 for commercial (lowest slab). Calculating this through you will find the economics of just laying down panels financially sound. Its just a matter of the latest solar panels which are low cost per watt not being marketed yet there.

For those interested in concentrators, should check out some cool technology from http://www.coolearthsolar.com/technology

they have cheap mylar baloons (same as birthday baloons) used as the reflectors - not heavy expensive mirrors.


Nikolay KulinichOct 12 2012 06:53 PM

Would help, but not solve the problem.

Kirit NaikOct 16 2012 08:33 AM

Why use parabolic mirrors to concentrate sunlight to generate steam that will be used to generate power which needs to be transmitted to a user who then runs his air conditioning system using the transmitted power?? Rather put the parabolic dish near him, set up an adsorption chiller to run his air conditioning system. It will:
• Save on investment in CSP power generation unit
• Save on investment in T&D infrastructure
• Save on T&D losses
• Save on inefficiencies in power production, transmission, power based air conditioning systems
• Make the air conditioning system independent of the grid
• Whatever little power that will be required to run the adsorption chiller could be produced by installing solar photovoltaic panels

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Switchboard is the staff blog of the Natural Resources Defense Council, the nation’s most effective environmental group. For more about our work, including in-depth policy documents, action alerts and ways you can contribute, visit NRDC.org.

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