Energetica India Magazine -October 2020

40 energetica INDIA- October_2020 Governments, investors and utilities across the globe are rapidly moving away from coal as they realise the need to accelerate the transition to a low-cost, low-emission and sustainably profitable energy economy. To date, 142 major financial institutions including multi-lateral development banks, insurers, export credit agencies and private banks have announced coal-exclusion policies. The majority state-owned NTPC’s recent announcement that it will stop pursuing new greenfield coal-fired power projects is part of an ongoing strategic shift into renewable energy by India’s largest thermal power generation company. NTPC’s long-term target of about 32 gigawatts (GW) of re- newables by 2032 ¬– 24.6% of its total planned capacity of 130GW – makes it a key player driving the electricity sector transition, in line with the Government of India’s ambitious goal of 450GW of renewables and hydro power by 2030. In August 2019, NTPC announced it planned to set up a 5GW ultra-mega industrial solar park in Kutch, Gujarat, with an in- vestment of Rs 20,000 crore (US$2.7 billion). Then, amidst the gloom of the economic downturn exacerbat- ed by COVID-19, came the positive news that the Gujarat gov- ernment is starting the land allotment process for a massive 42GW ultra-mega renewable energy park in Kutch. When fully commissioned this will be world’s largest renewable energy facility, twenty times the size of the world’s current largest op- erational one, Rajasthan’s 2.2GW Bhadla solar park. Reportedly, NTPC will be allotted 10,000 hectares of land for its planned 5GW ultra-mega solar park in Kutch as part of the larger 42GW of planned capacity by the Gujarat government. It currently has 2.3GW of renewable energy capacity under construction. When commissioned, this will take NTPC’s re- newables portfolio to 3.3GW. In financial year (FY) 2019/20, NTPC acquired two of India’s largest hydro power utilities: North-Eastern Electric Power Corporation Limited (NEEPCO) and THDC India Ltd (THDCIL), adding 3.3GW (1.8GW from NEEPCO and 1.5GW from THD- CIL) to its existing capacity. This acquisition also included 527 megawatts (MW) of NEEPCO’s gas-fired capacity. NTPC, along with Solar Energy Corporation of India, has also been playing an important role in facilitating renewable energy tenders by acting as a guarantor between renewable power producers and distribution companies (discoms). The company also plans to gradually expand into electric ve- hicle charging infrastructure as the electrification of transport creates a convergence between the power and transportation industries. Falling Coal-Fired Utilisation Rates, Rising Thermal Tariffs However, while expanding into renewables NTPC will also continue to deliver thermal power for decades to come. As of August 2020, it has 52.9GW of coal-fired capacity operational – a quarter of India’s total coal-fired capacity. FY2019/20 saw NTPC commission 3.4GW coal-fired capacity Kashish Shah Research Analyst, Institute for Energy Economics and Financial Analysis (IEEFA) POWER SECTOR Transition of NTPC - The Flag-Bearer for India’s Electricity Sector