Kanjurmarg waste-to-energy plan ready to roll

Mumbai's degraded waste at Kanjurmarg will produce electricity from April. The Rs 4.5 crore Guascor engine from Spain, to convert methane gas into electricity, will arrive at the landfill site on March 25 and the project will be commissioned next month.

If it succeeds, it will be the city's first waste-to-energy project. The earlier one at the Gorai dumping ground for which the BMC even won an award, did not take off. "The engine is already in use in sugar factories, distilleries and even at the Solapur dumping ground where it generates 5MW electricity and is connected to the state electricity board's grid. It will surely work," said Shiju Antony, director, Antony Lara Enviro Solutions. The company has been awarded a 25-year contract for the landfill site.

Of the 141 hectares of salt pan land allotted to the BMC for a landfill site, it has been allowed to use only 66 hectares. Last month, Maharashtra Coastal Zone Management Authority (MCZMA) permitted use of an additional 52.5 hectares of Coastal Regulation Zone-III land for waste processing.

The current technology being used at the landfill site is a bioreactor. Around 3,000 metric tonne of mixed waste is dumped in a 12-hectare cell that has been further sub-divided for proper dumping of waste. When a section is filled with 10,000 metric tonne of it, which takes three days, waste on the fourth day is dumped into a new section. For every four-metre height of waste, two parallel pipes are laid—one to collect the leachate and the other, a perforated one, to collect gas.

The gas is brought to a flaring point where, at present, it is flared so that it does not escape into the atmosphere and catch fire. Once the engine is installed, the pipe will be connected to it and the methane will be converted into electricity.

"Initially we will use it as a captive power plant. The electricity generated will be used by us for street lights at the dumping ground. At present, 3,000 metric tonne of mixed waste daily generates round 380 cubic metre of gas. In the long term, it is estimated to generate 12MW of electricity. Our requirement is 2MW, the rest can be sold by the BMC to generate revenue," said Antony.

It was estimated that methane's release would begin only after 18 months; though, in fact, it started being released within six months. "The quality of waste reaching the dumping ground is largely wet waste and hence the quick generation of methane. There are a lot of plastic bags less than 50 microns and huge quantities of chindi(small pieces of cloth). Plastic bottles and metal are all picked up by rag-pickers, dumper drivers and cleaners as they have monetary value. Very little of it reaches the dumping ground," said Antony. The liquid that drains out from the garbage called leachate has been prevented from seeping into the ground by laying six layers of different materials on the bed of the cell on which the garbage is dumped. Beside the bottom, at every four metres, pipes have been laid to capture the gas and the leachate.

That the leachate does not percolate into the ground is regularly monitored by National Environmental Research Engineering Institute and Maharashtra Pollution Control Board. The leachate is collected in a leachate pond. A leachate treatment plant with a capacity to treat 250 cubic metre of the liquid has also been set up. Some of the raw leachate is recirculated into the garbage depending on the moisture required. The remainder is treated and the water is used for gardening and dust suppression. "This keeps down suspended particulate matter," said Srinivasan Chari, business development manager. The company was awarded the contract in 2009 and is paid Rs 600 per tonne of garbage as tipping fee. Work on waste processing could start only last year as the matter was caught in litigation. Activists had raised issues of mangrove destruction.

At the time, it had said a composting plant would be set up at the site. While the equipment was brought in 2011, work could not start due to court cases. The technology called windrow is being now installed on 12 hectares of landfill site. It will treat another 1,000 metric tonne of waste. "It allows segregation of waste. The plant consists of a material-recovery facility where all recyclable and inert material is separated from biodegradable waste. The latter is put into various cells where the temperature is maintained at 70 degrees centigrade. After 28 days, it will be converted into pure compost."

The dumping mound is maintained at 35 metres on account of aviation restrictions. It's covered with soil so there is no visible garbage except in the area where dumping is on. While stench continues to be a problem though enzymes are sprayed to neutralize it, contractors have set up a citizens helpline (8080032282) to call if affected by it. "We immediately spray the enzymes," said Chari.

Expert's Comment

The waste to energy can be the future of Indian energy source. The potential is huge in the country and with the Govt.initiatives it can become huge business.

It also supports the mission of swachh bharat of the Govt.of India. 

Coal cess hike to pinch merchant power players

While there were low expectations from the Union Budget for the power sector, the doubling of the clean environment cess on coal and lignite to Rs 400 a tonne will lead to producers’ electricity cost rising by Rs 0.9-1.3 per kilowatt hour, estimate analysts. The increase will depend on the grade of coal and distance between mine and power plant. Companies having cost-plus power purchase agreements (PPAs) as NTPCor Reliance Power will not get impacted, as fuel costs are a pass-through. However, these such as JSW Energy, which sells 20 per cent of coal-fired capacity in the open market and therefore exposed to short-term and merchant rates, might feel the pinch since costs will not be pass-through. Among others, Adani Power having nine per cent of total capacity (especially from its Mundra project) exposed to short-term or merchant power will also feel the heat. Similarly, CESC, which can sell about 75 Mw from its Kolkata business as merchant power, might feel the heat.

Overall, analysts at Nomura expect about three per cent impact on JSW Energy’s consolidated FY17/18 earnings, while Adani’s FY17/18 bottom line are expected to be impacted by 12-14 per cent due to low base. Coal India might not be directly impacted, but increase in cess might limit its ability to take price hikes given the weak demand scenario. The government’s high disinvestment target means the stake sale overhang on Coal India and NTPC will continue their stock prices in check.

Nevertheless, there are some positives including the increased outlay for renewable energy. Analysts at Elara Capital believe this would accelerate solar power projects and is positive for NTPC and Reliance Power, as they plan to set up 3.3-Gw solar projects each by FY19.

Another positive is permitting PPA renegotiations in disputed projects, which can help revive capex cycle in power and will be positive for some power players. While this is likely to take a few quarters, renegotiations can benefit players as Adani Power, Tata Power, GMR Energy and RattanIndia Power, say analysts at Elara.

The transmission and distribution sector as well as transformer companies will benefit from the targeted completion of rural electrification by 2018. Hemal Zobalia, partner, Deloitte Haskins & Sells, says long-standing issue on availability of incentive to power transmission companies is answered with additional depreciation of 20 per cent on new machinery being extended for power transmission as well.

Of all, Power Grid, which remains unaffected by the increase in coal cess and is a potential beneficiary of the increase in FPI limit to 49 per cent, is best placed. Analysts at Nomura say Power Grid is best placed with historically high level of foreign portfolio investment in the stock (25.7 per cent as of December 2015).


Expert Comment:

With the increase in coal cess,the tariff rate will rise for those power plants who sell power in short term market.This might change the scenaro of exchange and bilateral market in future. There is good news for transco companies as they have the A.D.scheme available.

IEX: Average Market Clearing Price (MCP) on Feb’16 was all-time low at Rs. 2.30 per unit

 

New Delhi: The spot power market continued to be the most competitive option for distribution utilities and open access consumers to procure power with average Market Clearing Price (MCP) on Feb'16 at all-time low of Rs. 2.30 per unit in fiscal 2015-16.

Average MCP at Rs. 2.30 per unit is about 9% lower than Rs. 2.52 per unit in January, even average Area Clearing Prices (ACP) across all bid areas reduced by 6-12% in February, Indian Energy Exchange (IEX) said in a statement. 
IEX which is India's premier power trading platform currently operates Day-Ahead Market (DAM) and Term-Ahead Market (TAM) in electricity as well as Renewable Energy Certificate (REC) Market.

Interestingly, ACP at Rs. 2.51 per unit in the Southern region was even lower than ACP in the Northern region at Rs. 2.64 per unit.

This has particularly been due to increase in generation capacity within the southern region and reduced reliance on import of power from the rest of India.

However, transmission congestion in WR->SR and ER->SR corridors continued, added the statement.

At 2,818 MUs, volume traded in February was marginally lower than volume traded in January (2,929 MUs).

However, the average daily volume in Feb'16 was much higher at 97 MUs in comparison to 94 MUs last month.

Aggregated purchase bids for the month were 3,285 MUs (about 4,720 MW on average daily RTC basis) and sell bids were 5,338 MUs (about 7,670 MW on average daily RTC basis).

About 112 MUs were curtailed in Feb'16, about 26% lower than volume curtailed in January (152 MUs).

The ER->NR and WR->NR interconnections were congested 44% and 40% of the time respectively and the ER->SR and WR->SR interconnections were congested about 44% of the time during the month.

Prices (ACP):

In February, average Area Clearing Price (ACP) dipped across all the regions.
In North-East, East and West, ACP was Rs 2.11 per unit, about 6% lower than last month.
In South, ACP was Rs 2.51 per unit, 12% lower than the previous month.
In North, ACP was to Rs. 2.64 per unit, 8% lower over the previous month.


Volumes:

A few key power market highlights are as given below:

Total Sell bids - 5,338 MUs
Total buy bids - 3,285 MUs
Total Cleared Volume - 2,818 MUs

The Northern and Southern States were Net Buyers while the Eastern, Western and North-Eastern States were Net Sellers


Participation:
1,171 participants traded in the spot market on an average daily basis. The highest participation was on 25 February, 2016 when 1,237 participants traded on the Exchange.

Term-Ahead Market:
About 25 MUs were scheduled during the month, mainly in the Intra-day and Day Ahead Contingency segments, IEX statement added.
 

EXPERT COMMENT:

From this we can see the future of short term power market in India. The prices are way below than the long term PPA signed by the Discoms. This will help the Discom to purchase power at very low rate which can reduce their burden to buy expensive power.However the states commissions should make lucrative regulation so that the short term power market can grow at faster pace.

India and Bangladesh Power Tie Up

Today I will be discussing on the topic on India and Bangladesh Power Tie up.

I was reading news on ET where it was written that NTPC is in talks with Bangladesh govt. for selling of electricity. Presently Bangladesh import electricity from India. NTPC is playing a major role in electricity generation market in India.

In news it is discussed that NTPC is going to commission its 750 MW power plant in 2016. The 85% of total capacity will be supplied to seven north eastern states. Bangladesh is also interested to take power from this NTPC power plant. Bangladesh as a country is a "Deficit in Electricity". So for development of Bangladeh,the govt.needs electricity. Thus it will be easy to import from India,as India have much more resources as compared with Bangladesh.

On Lighter note, we can say that Power will bring friendship between two countries.
From the business perspective,this will also facilitates lots of opportunities.

Renewable Energy Certificate -Decoding

Renewable Power is the energy source which is one of the mostly researched by many countries. In India the Installed capacity of renewable energy is still small in number. The main cause is cost,efficiency and reliability. If demand is not there than obviouslly supply will be less. Suppose if you are getting same chocklate at different rates,then consumer will take the less price chocklate. Similarly in power if you are getting electricity from thermal power at cheaper rate than renewable,the consumer will choose themal.

Thus the concept of REC ( Renewable Energy Certificate) evolved. To protect the environment from dangerous pollutants evolving from themal sources there is a need of renewable power.The government decided to promote renewable sources through various routes. REC was one of them.
REC means a certicate which proves that 1 MW of electricity is generated via renewable source. This certificate is traded via power exchanges (i.e. PXIL and IEX).

The buyers for REC can be Discoms,Open access consumer,captive power plants. Every states have targeted the purchase of renewable energy cerificate.The target is set up by respective SERC's. With REC there can be added advantage to states where there are less resources of renewable energy sources.

But if you will see the present scenario of REC,the situation is in bleak state. There are lakhs of suppliers of REC but the buyers are in thousands. The main problem exists in policies of the respective states. Discoms situation is not in a good situation where they are not able to pay for cheap power. Thus this creates a mismatch supply demand in REC market.

REC is of two types: Non Solar and Solar REC. Non solar include small hydro,biomass,W2E,etc.Solar REC include power generated by solar power. Non solar REC price is low as compare with solar REC.Thus the non solar REC is getting better demand than Solar REC.

Now its time to think that what we can do for REC which can promote renewable source. 

I got an idea to promote REC as consider as a CSR activity. There are many companies in India where there is inclusion of CSR activity.Thus we can propose to companies to buy REC as their CSR activity. It will be Win-Win situation for all. The sellers will get their buyers and companies can easily perform CSR activity without any hurdles.

There can be many ideas to promote REC in India.Please share your ideas in comment section below.