India’s Largest REC Trading Company
Indian RE Market and Open Access
LAUNCHING SOON Online marketplace
for power
transactions
Bangalore | New Delhi | Mumbai | Chennai | Hyderabad | Indore| Jaipur
Executive Summary
 Open Access in RE makes sense:
 Open Access is very much possible for RE projects
 Cost savings are achievable over grid-tariff (often when combined with
RECs)
 It fits sustainability agenda for many organization
 In some states intra-state transactions do take place
 However, there are several impediments:
 Lack of inter-state transactions as RE power is not scheduled
 Changing policies – no certainty and new regulatory roadblocks emerge
all the time
In general RE Open Access transactions are difficult due to regulatory
hurdles
2
Energy Mix in India
Energy Mix in India - Installed Cap. as on 31.01.2014
4780
1.7%
39875
14.5%
Thermal
Nuclear
39395
14.3%
Hydro
20298
Wind
30176
11.0%
160484
58.4%
Captive
Small Hydro
3774
1285
2512
99
2208
Biomass/Biogass
Bagasse Co-Generation
Waste to Power
Solar PV/Thermal
Ref: MNRE, CEA (as on Feb 26, 2014)
3
Electricity Eco-system in India
Generation
•
•
•
•
•
Central
• NTPC, NHPC,
NPCIL
State
• KPCL in KAR
• MAHAGENCO
in MH
Private
• IPPs (Jaypee)
• MPPs (Jindal)
• UMPPs (Tata)
Renewable
• IPPs
Captive
• Thermal &
Renewable
Transmission
•
•
Central
• PGCIL
State
• State
Transmission
Companies
• E.g.,
TANTRANSCO in
TN
Distribution
•
•
•
•
Private
• In progress
Central
• None
State
• State
Distribution
Companies
• E.g., GUVNL in
Gujarat
Private
• BEST, Tata,
Reliance in MH
• NDPL, BYPL,
BRPL in Delhi
• CESC in WB
4
Eco-system…continued.
Grid Operations
•
Central
• NLDC
•
Regional
• RLDCs
(North,
East,
West,
NorthEast,
South)
State
• State Load
Dispatch
Centers
ABSOLUTE
Monopoly
•
•
Energy Accounting
•
•
•
Central
• CEA
• NLDC
Regional
• RPC
• REA
• RLDCs
State
• State
Load
Dispatch
Centers
Regulatory
•
Central
• CERC
•
State
• SERCs
APTel
• Apex
body
•
Electricity – a
concurrent
subject
Executive
•
Central
• MoP
• MNRE
•
State
• Dept. of
Energy
The Electricity
Act – 2003
binding to
all.
5
Open Access
 Non-discriminatory access to use transmission and distribution
[Section 2(47) - the Electricity Act 2003]
 Significant Importance:
 ‘Open access' in the power sector is an essential long-term reform
– Montek Singh Ahluwalia (Dy. Chairman, Planning
Commission, GoI) READ MORE
 Ministry of Power and Ministry of Law & Justice on openaccess
 All 1 MW and above consumers are deemed open-access
consumers
 Regulator has no jurisdiction for fixing up energy charges for such
consumers READ MORE
6
Options under Open Access
Uses only STATE transmission and/or distribution network
Wheeling & Banking for RE Generation
Relaxed scheduling and energy settlement requirements*
Metering as per state specified norms – mostly TOD (time of
day)*
Bilateral
Intra-State
•
•
•
•
Power
Exchange
Inter-State
•
•
•
•
Uses State/Regional trans. & distribution N/W
Scheduling as per Indian Electricity Grid Code
Energy settlement as per state norms
Metering – ABT, 0.2s Class
•
Collective (Day Ahead Market-DAM) & Bilateral
(Term Ahead Market-TAM) transactions
Metering – ABT, 0.2s Class
Pre-specified delivery point
Market determined price
•
•
•
* - varies from state to state
7
RE Market – Can it Compete?
Consumer affordability matrix.
Cost Saving
Potential
4% - 12%
Approx.
Electricity Tariff
Rs / kWh
10
MH
8
MH
6
TN, KA, PNJ, AP
RJ, HR, DEL
4
KER, MP, GJ
KER,TN,AP,KA
PNJ, RJ, HR
RE
Tariff
MP, GJ
UTK
UTK, CH
2
Industrial
Consumer
Commercial
Consumer
Intra-State
Open-access
/ PX
9
Cross susbsidy surcharge in Haryana
2.5
2
1.5
1
+94 %
+281%
+83 %
0.5
0
HT Industry
NDS HT
FY 14
Bulk Supply
FY 15
10
Charges applicable under open-access
Intra-State
Power Exchange
Wheeling Charge / Distribution
Charge & Losses
Yes
Yes – subject to
injection & drawal
voltage
State Transmission Charge & Losses
Yes – subject to injection
and drawal voltage
Yes
Banking Charges
Yes – if permitted by state
NA
Regional Transmission Charges &
Losses
NA
Yes
Scheduling & Operations Charges
SLDC only
SLDC & RLDC
Cross Subsidy Surcharge
Yes
Yes
Power Exchange Charges
NA
Yes
11
Wheeling – The Concept
Power Transformer
11/22/33 kV to
66/110/220 kV
Transmission Line
Higher Voltage Level and
hence lower transmission
losses
Power Transformer
66/110/220 kV to
11/22/33 kV
Distribution Feeder
(11/22/33 kV)
Distribution System
(11/22/33 kV)
Wheeling Charges* ( T&D
Losses + T&D Charges )
Industrial Consumer –
End User
Wind Mills at lower
voltage level in the
Grid
* Wheeling charges collected to cover T&D Charges and Losses
12
Banking – The Concept
State Grid
Many Generators & Many Consumers
Massive size of state grid adjusts surplus / deficit energy
by changing its own generation / load
Month
kWh
Injected
Month-I
5000
Month-II
18000
Month-III
12000
kWh
Consume
d
Energy
Adjusted*
Energy
Banked
Energy
Billed by
DISCOM
12000
5000
0
7000
9000
9000
9000
0
21000
21000
0
0
* Assumed: Zero Banking Charge
13
Choosing the best option
Pros
Intra-State
•
•
•
•
Cons
•
•
•
•
Power Exchange
Assured volume & price
Long term contracts
Flexible energy settlement
No special energy meter
required
Assured entitlement
•
•
Counter-party default
No price discovery – mutual
negotiations. Hence, inefficient
High search cost/time
•
•
•
•
•
•
•
Market discovered price
Significant price advantage in
many cases
No counter-party default
Assured entitlement
Transparent mechanism
No long term contracts
Price & volume risk
Energy settlement may become
tedious in some cases
Cost of market access
An optimal combination can eliminate market risk and assure long
term price-volume certainty.
14
ABOUT RECONNECT
Services Offered (Electricity Consumer)
• Open Access Formalities
• Statutory Charges
• Regulations
ELECTRICITY USER
Needs
Electricity
RPO Liabilities
Owns Business
/ Land or Roof
• Cost Benefit Analysis
• PX
• Bilateral
• Captive
• REC
• Green Power
• Tax
• Investment
• Existing Land
/ Roof
• Access to Market (PX and
Intra-State/Bilateral)
• Compliance Planning
• Access to Market
• Compliance formalities
• Regulations
• Tax Incentives Planning
• Resource Assessment
• Investment Model
• Financial Closure
• Regulations
• Vendor/Tech Selection
• Concept to Commissioning
16
Core Team
Advisory
Board
Management & Team
Education
Key Positions / Experience
Current Engagement
Prof. S A Khaparde
PhD – IIT
Kharagpur
• Member (Advisory Committee):
MERC, IEX
• Member – Indian Smart Grid
Forum
Professor, Dept. of EE,
IIT Bombay
Bruce M Usher
MBA – Harvard
Business School
• CEO – EcoSecurities (World’s
largest Carbon trading firm)
• CEO – Treasury Connect LLC
• Chairman – Persistent Energy
Partners
Executive in Residence –
Social Enterprise Program
Columbia B-School
Vibhav Nuwal
(New Delhi)
MBA – Columbia
Business School
• Carbon Finance – Managing
Emissions
• Worked with J P Morgan, Arthur
Andersen, LEK Energy (UK)
Director (Head – RPO
Market)
Vishal Pandya
(Bangalore)
M.Tech – IIT
Bombay
• Power Trading & REC - IEX
• Sub-station Designing – L&T
Director (Head – Electricity
and Market Analytics)
Ramkumar
(Mumbai)
MBA - Symbiosis
• Carbon Advisory – GENSOL
• Marketing – Chequered Flag
Director (Head – REC
Market)
Madhusudan C
(Bangalore)
MBA – RSM, The
Netherlands
• Tech Director – Erasmus Medical
Center, Netherlands
Chief Technology Officer
17
Nation-wide presence
REConnect Office
CPP/Open Access
Client [~800 MW]
RE Generation
[~2000 MW]
Wind/Solar
Forecasting &
Scheduling [600MW]
REC Market
•India’s largest REC Trading Company
•
46% Market share in Non-Solar RECs
•
85% Market Share in Solar RECs
•2.5GW of RE under management
18
Our other presentations
• Renewable Energy Certificates
• Renewable Purchase Obligation
• Electricity Portfolio Management
THANK YOU!!
VIBHAV NUWAL
Vibhav.nuwal@reconnectenergy.com
CONTACT US
Bangalore
New Delhi
Mumbai
Chennai
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