India’s Power Excess Might Exhaust in 2-3 Years while Meeting Peak Demand with Limited RE

It further that some form of additional peak supply would be needed at most by 2022, after exhausting the recoverable outages of about 25 GW -- a mix of no fuel and no demand today. There is a modest “surplus” in the grid today, which varies based on demand and availability of RE

September 16, 2019. By News Bureau

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The present surplus in India’s power generation capacity may exhaust in 2-3 years if used to meet the evening peak in a situation where renewable energy generation if often inadequate, as per study by Brookings India.

“With a growth of nearly 10 Gigawatt (GW) in peak demand anticipated every year, perhaps more, the current capacity surplus as well as the planned installation of non-coal firm capacity might not be enough to meet the peak demand as early as 2021 or 2022,” the study authored by R Tongia and M T Parray stated.

It further that some form of additional peak supply would be needed at most by 2022, after exhausting the recoverable outages of about 25 GW -- a mix of no fuel and no demand today. There is a modest “surplus” in the grid today, which varies based on demand and availability of RE.

This would also change in the future based on any shifts in load shapes, the study said. It projected how long the “recoverable” capacity can suffice based on projections for future growth of the load, measured at the peak.

India’s gross installed capacity is around 349 GW but peak load met over 2018-19 at a grid level was around 175 GW. A significant part of this gap between demand and supply is explained by grid-level losses, infirm capacity including renewable energy, and plants under “outages".

The factors contributing to outages of capacity include technical issues, low demand and low fuel availability. "At the national level, India’s peak electricity demand usually occurs in the evening. Meeting this demand requires relatively firm supply which variable renewable energy cannot supply in the absence of storage," said the report.

It said although renewable energy is growing at a fast pace in India, in the long run without storage, it plays a very small -- around 3 per cent observed during December 2018 -- role in meeting the peak demand, which mostly occurs in the evenings.

The authors argue that the conventional wisdom of India being a vastly power surplus nation needs to be tempered when we consider not energy but instantaneous capacity requirements. The former is talked about in terms of under-utilized and even stranded capacity assets, which also suffer from low PLFs.

“This is distinct from the problem of meeting the peak demand, often in the evening. As this analysis shows, to meet the evening peak, when renewable energy is often limited, the present capacity surplus may exhaust in two-three years,” the report stated.

It endorses use of peaking power, storage, and load-shifting as tools to balance demand and supply, combined with more flexible and time-of-day reflective pricing for electricity supply.

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