CEA Asks States to Use 5-10% Biomass Pellets for Power Generation in Thermal Plants

The Central Electricity Regulatory Commission (CERC) has set generic tariffs for the purchase of electricity from a host of renewable energy generation sources during the financial year (FY) 2019-20. The levelized generic tariff will apply to small hydro projects, biomass with Rankine cycle projects, non-fossil fuel-based co-generation projects, biomass gasifiers, and biogas-based projects.

These are the finalized tariffs after the CERC proposed it for FY 2019-20 back in January 2019.

For solar photovoltaic (PV), solar thermal, wind (onshore and offshore), municipal solid waste (MSW)/refuse derived fuel (RDF) and other emerging renewable energy technologies, the determined tariff will be project specific, and not generic.

In its order, the CERC has considered the useful life of small hydro projects to be 35 years, while the useful life for biomass with Rankine cycle, non-fossil fuel-based co-generation, biomass gasifiers, and biogas-based projects will be 20 years.

For renewable energy technologies having fuel cost component, such as biomass power projects and non-fossil fuel-based cogeneration, a single part tariff with two components (fixed cost component and fuel cost component) has been determined.

For small hydro projects of capacity below 5 MW, the capital cost will be ₹100 million (~$1.45 million)/MW in Himachal Pradesh, Uttarakhand, West Bengal, and North Eastern states while it will be ₹77.9 million (~$1.13 million)/MW in other states. For small hydro projects of capacity in the range of 5 MW to 25 MW, the capital cost will be ₹90 million (~$1.30 million)/MW in Himachal Pradesh, Uttarakhand, West Bengal, and North Eastern states and in other states, it would be ₹70.7 million (~$1.02 million)/MW.

For biomass with Rankine cycle project (other than rice straw and Juliflora (plantation)-based project) with a water-cooled condenser, the capital cost will be ₹55.9 million (~$0.81 million)/MW.  For project other than rice straw and Juliflora (plantation) with an air-cooled condenser, the capital cost will be ₹60.044 million (~$0.87 million)/MW. For rice straw and Juliflora (plantation)-based project with a water-cooled condenser, the capital cost will be ₹61.080 million (~$0.89 million)/MW. For rice straw and Juliflora (plantation)-based project with an air-cooled condenser, the capital cost will be ₹65.220 (~$0.95 million)/MW.

For non-fossil fuel-based cogeneration projects, the capital cost will be ₹49.25 million (~$0.71 million)/MW, and for biomass gasifier projects, the capital cost will be ₹44.3 million (~$0.64 million)/MW. For biogas power projects, the capital cost will be ₹88.6 million (~$1.28 million)/MW.

The CERC has considered a debt and equity ratio of 70:30. The interest rate considered for the debt component of capital cost is 10.41 percent.

This is the third year of the control period in which the CERC has issued generic tariffs for select renewable energy sources. In March 2018, it had issued generic tariff for select renewables for FY 2018-19. Mercom previously reported on the generic tariff proposed by CERC for select renewables for FY 2017-18.

The generic tariff set by the CERC for select renewables is way more than the existing project-specific tariffs discovered in auctions for solar and wind projects in India. Successive central government and state government auctions have pushed the tariff for wind in India to below ₹3 (~$0.04)/kWh mark, the same holds true for solar projects.

Saumy Prateek Saumy is a senior staff reporter with MercomIndia.com covering business and energy news since 2016. Prior to Mercom, Saumy was a copy editor at Thomson Reuters. Saumy earned his Bachelors Degree in Journalism & Mass Communication from the Manipal Institute of Communication at Manipal University. More articles from Saumy Prateek.