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South Australia can be a model for India on renewable energy

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Karnataka, Tamil Nadu, Gujarat, Maharashtra, Rajasthan and Andhra Pradesh have built and contracted renewable energy generation capacity — at a combined total of 65.3 gigawatts (GW) of variable renewable energy — at less than ₹3/kWh (US$41.5/MWh) over the last three years.

According to the Institute for Energy Economics and Financial Analysis (IEEFA), India’s tariffs are lower then the average renewable tariff achieved by South Australia over the last three months in real terms as there is zero inflation indexation for 25 years incorporated into these transformational contracts.

The Australian State of South Australia (SA) has been a leader in transitioning its electricity sector to a low-cost, low-emission and a renewable energy-driven system and in a short space of time, has achieved the price of AU$56.84/MWh in November, 2019.

South Australia boasts of one of the highest renewable energy penetrations in the world, despite being located at the ‘end’ of a national grid which severely limits its ability to leverage interstate electricity flows, according to IEEFA.

The State produced 54.6% of its total power generation from variable renewable sources during 2019. Onshore wind and solar (both utility scale and rooftop) represented 49% of total installed electricity capacity, and battery storage another 2%.

“South Australia’s accelerated energy system transformation is a model for States and territories transitioning their power systems, such as India’s top six renewable energy states,” said Kashish Shah, energy finance analyst, IEEFA India in a report.

Unlike South Australia, which is a small, remote market at the end of a long-line grid with just one neighbouring State with which to trade electricity, India’s top six renewable States already have multiple trading partners via a well-functioning and growing interstate grid system, strongly led by the Central government’s Green Energy Corridor investment programme.

This provides an excellent opportunity for leading States to look at increased investment in renewables, not just to meet their own power demand, but also to drive electricity exports to States which do not have great renewable energy potential.

This could allow loss-making discoms of ‘renewable-rich’ energy States to earn new revenues and profits, and spare loss-making discoms of ‘renewable-poor’ States from investing in increasingly expensive new thermal generation capacity, providing a partial financial solution to the current dire state of discoms across India, according to the IEEFA report.

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Printable version | Jan 21, 2020 4:36:07 AM | https://www.thehindu.com/business/states-selling-renewable-power-at-less-than-3kwh/article30561306.ece

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