Solar Rooftop: Perspective of Discoms Findings from consultations with Discoms 2/22/2019 1
Content • Objectives • Approach and Methodology • Findings of Interactions • Key Findings • Challenges • Challenges and Opportunities – Technical, Financial, Operational & Administrative • Regulatory Barriers and Recommendations • Utility’s Perspective • Summary and Conclusions • Way Forward • Suggested Utility-Based Business Models • Schemes for Discoms – Solar Rooftop (Phase-II) & KUSUM 2/22/2019 2
Objectives Broad objective To present an overview of Discoms’ perspective with regard to the technical, financial, operational & administrative, and regulatory aspects of Rooftop Solar. Specific objectives • To highlight the key implementation and post-implementation challenges faced by Discoms with respect to rooftop solar. • To present some of the operational and institutional practices that has enabled Discoms to implement rooftop solar in their license area. 2/22/2019 3
Approach and Methodology Understand the structure and contours of Central and State policies and regulations Literature review of key studies that came out in past four years on rooftop solar Development of consultation framework and checklist of questions for discussion with Discoms Individual and group interactions with senior Discom officials Collation of findings and development of discussion paper 2/22/2019 4
States and Discoms Covered 30 Discom Officials Managing Directors/ 9 Directors, Chief Engineers/ Discoms General Managers and Superintendent Engineers – in charge of commercial, technical, revenue, and project The selection was done with a view to include Discoms from states which have larger potential for rooftop solar, different consumer mix and ownership structure of utilities, such as either public or private. 2/22/2019 5
Findings of Interactions 2/22/2019 6
Key Findings • Discoms generally feel that solar rooftop is a viable business proposition, if Discoms take anchor role in its implementation. • In order to uptake the solar rooftop segment in the country, few barriers are required to be overcome through regulatory interventions and customized * business models. * Based on consumer mix, location, other parameters 2/22/2019 7
Grid connectivity and Safety aspects, Power Quality Issues, Technical Anticipated generation forecasting Implementation Revenue loss, additional Financial administrative expenses Challenges * Metering & Billing, Role of Operational & Anticipated Post Discom , Lack of manpower, Administrative Real-time monitoring Implementation Gross Metering vs. Net Metering, Standardization of Regulatory bidding documents and tenders * Type and degree of challenges varies from State to State 2/22/2019 8
Technical Challenges and Opportunities Challenges • Hosting capacity of DTR for solar rooftop • Network augmentation required to accommodate anticipated growth in solar rooftop • Issues due to penetration of solar rooftop – power quality, grid connectivity and safety Opportunities • Reduced T&D losses • Infrastructure deferral to meet the peak demand • Reduced network loading – reliability of supply 2/22/2019 9
Financial Challenges and Opportunities Challenges • Loss in revenue due to reduced energy sales • Increased burden of infrastructure augmentation/ upgradation to incorporate solar rooftop • Increased burden of cross subsidy on low paying consumers Opportunities • Compensation for REC at lower cost • Deferring capital expenditure on network augmentation & reduction in O&M expenditure • Reduction in power purchase cost 2/22/2019 10
Operational & Administrative Challenges and Opportunities Challenges • Metering and Billing • Solar rooftop generation – monitoring and forecasting • Lack of skilled manpower Opportunities • Better reliability of power supply • Meeting RPO targets • Reducing the overall demand 2/22/2019 11
Regulatory Limitations and Recommendations Limitations Recommendation • Amendments – More Discom- • Consumer-oriented policy oriented and regulations • Clarity and standardization of • Lack of incentives for Discoms documents • Lack of coordination between • Incentives and measures for implementing agencies Discoms 2/22/2019 12
Utility’s Perspective Calcutta Electric Supply BSES Rajdhani Power Ltd. (BRPL) Dakshin Gujarat Vij Company Corporation Ltd. (CESC) – West – Delhi Ltd. (DGVCL) – Gujarat Bengal Madhya Pradesh Madhya West Bengal State Electricity Kshetra Vidyut Vitaran Company Distribution Company Ltd. Ltd. (MPMKVVCL) - Madhya (WBSEDCL) – West Bengal Pradesh 2/22/2019 13
Summary and Conclusions • Issues with increasing penetration – • Amendments - more Discom-oriented power quality, grid connectivity and • Clarity and standardization safety • Incentives and Measures • Hosting capacity of DTR • Coordination between implementing • Energy storage agencies • Anti-islanding issue Regulatory Technical Operational & Financial Administrative • Metering and Billing • Reduced energy sales & increased cross subsidy burden • Data Management - Monitoring and Forecasting • New and innovative business model • Lack of consumer awareness, skilled • Gross-metering net-metering manpower 2/22/2019 14
Way Forward Discom- oriented Targeted policies and Consumer schemes Awareness Empanelling of developers for the ease consumers Utility Based Business Models 2/22/2019 15
Suggestive Utility-Based Business Models For Gross Metering Connection Arrangement For Net Metering Connection Arrangement 2/22/2019 16
Schemes for Discoms Cabinet approves Phase-II of Grid Connected Rooftop Solar Programme for achieving cumulative capacity of 40,000 MW from Rooftop Solar Projects by the year 2022 Posted On: 19 FEB 2019 8:47PM by PIB Delhi Cabinet approves launch Kisan Urja Suraksha evam Utthaan Mahabhiyan (KUSUM) Posted On: 19 FEB 2019 8:40PM by PIB Delhi 2/22/2019 17
Phase-II of Grid Connected Solar Rooftop Scheme – Key Points Parameters Incentives Total Central Finance Assistance (CFA) • INR 11,814 crores For installed capacity achieved up to 10% CFA Support for different categories over and above of No Incentives installed base capacity • Residential Sector – for 4,000 MW capacity within a financial year. • 40% - up to 3 kW capacity • 20% - capacity beyond 3 kW and up to 10 kW For installed capacity achieved above 10% • GHS/RWAs - 20% for RTS plants for supply of power to common facilities 5% of the applicable cost for capacity and up to 15% over and • No CFA for all other categories - institutional, educational, social, achieved above 10% of the installed above of installed government, commercial, industrial, etc. base capacity based capacity within a Focused on increased involvement of Discoms financial year • Performance based incentives will be provided to DISCOMs based on RTS For installed capacity 5% of the applicable cost for capacity capacity achieved in a financial year over and above the base capacity i.e. achieved beyond 15% achieved above 10% and up to 15% of cumulative capacity achieved at the end of previous financial year over and above of the installed base capacity PLUS 10% • To compensate additional expenditure for implementation of scheme in installed based capacity of the applicable cost for capacity terms of additional man power, creating infrastructure, capacity building, within one financial achieved beyond 15% of the installed awareness, etc . year. base capacity. • Limit on incentives - for the initial capacity addition of 18,000 MW 2/22/2019 18
KUSUM Scheme – Key Points • 10,000 MW of Decentralized Ground Mounted Grid Connected Renewable Power Plants. • Capacity 500 KW to 2 MW; setup by individual farmers/ cooperatives/ panchayats/ farmer producer organizations Component • The power generated will be purchased by the DISCOMs at Feed-in tariffs determined by respective SERC. Performance A Based Incentives @ INR 0.40 per unit for five years to be provided to DISCOMs. • Implemented on pilot mode for 1000 MW capacity, at first. • Installation of 17.50 lakh standalone Solar Powered Agriculture Pump s. • Capacity up to 7.5 HP; Solar PV capacity in kW equal to the pump capacity in HP is allowed under the scheme. Component • CFA support – 30% (Central) + 30% (State) + 40% (Farmer – out of which 30% can be from banks) of benchmark cost; for B special category states, CFA of 50%. • Implemented in full-fledged manner • Solarization of 10 Lakh Grid-connected Solar Powered Agriculture Pumps . • Capacity up to 7.5 HP; Solar PV capacity up to two times of pump capacity in kW is allowed under the scheme; Excess Component available energy will be sold to DISCOM – help in meeting RPOs C • CFA support – 30% (Central) + 30% (State) + 40% (Farmer – out of which 30% can be from banks) of benchmark cost; for special category states, CFA of 50%. • Implemented on pilot mode for one lakh grid connected agriculture pumps, at first. KUSUM scheme aims to add a solar capacity of 25,750 MW by 2022, with total CFA provided under the scheme would be INR 34,422 crore. 2/22/2019 20
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