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Barriers to Adoption of Clean and Efficient Technologies in the Indian Power Sector: An Analysis Using AHP Anoop Singh, S. C. Srivastava Indian Institute.

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Presentation on theme: "Barriers to Adoption of Clean and Efficient Technologies in the Indian Power Sector: An Analysis Using AHP Anoop Singh, S. C. Srivastava Indian Institute."— Presentation transcript:

1 Barriers to Adoption of Clean and Efficient Technologies in the Indian Power Sector: An Analysis Using AHP Anoop Singh, S. C. Srivastava Indian Institute of Technology Kanpur Ram M. Shrestha Asian Institute of Technology, Thailand BAQ Dec 2006, Yogyakarta, Indonesia

2 Indian Power Sector – Generation Capacity Note: Additional Captive Generating Capacity = MW Source: CEA (2006) Generation capacity based on fossil fuels accounts for nearly 66.31% of the total generation capacity in the country. Generation capacity based on fossil fuels accounts for nearly 66.31% of the total generation capacity in the country. The 16th electric power survey projects a peak demand of 157,107 MW and an energy requirement of 975,222 MU by the year 2012 The 16th electric power survey projects a peak demand of 157,107 MW and an energy requirement of 975,222 MU by the year 2012 It is estimated that capacity addition of over 1, 00,000 MW would be required by the end of It is estimated that capacity addition of over 1, 00,000 MW would be required by the end of 2012.

3 Reforms and Clean Technology Liberalisation of Private and Foreign Investment in 1990s Liberalisation of Private and Foreign Investment in 1990s Regulatory Reforms – setting up of Centrl Electricity Regulatory Commission (CERC) and State Electricity Regulatory Commission (SERCs) Regulatory Reforms – setting up of Centrl Electricity Regulatory Commission (CERC) and State Electricity Regulatory Commission (SERCs) Electricity Act 2003 Electricity Act 2003 National Electricity Policy and National Tariff Policy National Electricity Policy and National Tariff Policy

4 National Electricity Policy (NEP) Lays down guidelines for accelerated development of the power sector Lays down guidelines for accelerated development of the power sector Supply of electricity to all areas Supply of electricity to all areas Protecting interests of consumers keeping in view availability of energy resources, technology available to exploit these resources Protecting interests of consumers keeping in view availability of energy resources, technology available to exploit these resources Economics of generation using different resources and energy security issues. Economics of generation using different resources and energy security issues.

5 Promotion of Renewable Energy As per Electricity Act 2003, SERCs to promote electricity generation from co- generation and renewable sources of energy. As per Electricity Act 2003, SERCs to promote electricity generation from co- generation and renewable sources of energy. Suitable measures for connectivity to grid and sale of electricity to any person. Suitable measures for connectivity to grid and sale of electricity to any person. specifying a percentage of power to be purchased from such sources. specifying a percentage of power to be purchased from such sources.

6 Objectives AARPEEC Project Phase II, three most promising clean and energy efficient technologies were identified AARPEEC Project Phase II, three most promising clean and energy efficient technologies were identified Integrated Gasification Combined Cycle Coal technology (IGCC), Integrated Gasification Combined Cycle Coal technology (IGCC), Pulverised Fluidised Bed Combustion (PFBC) Pulverised Fluidised Bed Combustion (PFBC) Biomass Integrated Gasification Combined Cycle technology (BIGCC). Biomass Integrated Gasification Combined Cycle technology (BIGCC). ARRPEEC Phase III - conduct a survey to identify and rank barriers to adoption of these technologies in the Indian power sector. ARRPEEC Phase III - conduct a survey to identify and rank barriers to adoption of these technologies in the Indian power sector. The responses are further analysed using Analytic Hierarchy Process (AHP) methodology to rank the barriers to adoption of identified technologies. The responses are further analysed using Analytic Hierarchy Process (AHP) methodology to rank the barriers to adoption of identified technologies. Further we also identify policy measures required to overcome these barriers and undertake a comparative evaluation. Further we also identify policy measures required to overcome these barriers and undertake a comparative evaluation.

7 Clean and Energy Efficient Technology for Power Generation National Thermal Power Corporation (NTPC) is introducing super critical technology. National Thermal Power Corporation (NTPC) is introducing super critical technology. A pioneering work on coal based IGCC has been undertaken by BHEL on a 6.2MW pilot plant at Trichy. A pioneering work on coal based IGCC has been undertaken by BHEL on a 6.2MW pilot plant at Trichy. NTPC and BHEL, with assistance from the USAID, have taken up a detailed feasibility study for setting up of a 100 MW IGCC demonstration plant at NTPC’s station no.1 located at Dadri. NTPC and BHEL, with assistance from the USAID, have taken up a detailed feasibility study for setting up of a 100 MW IGCC demonstration plant at NTPC’s station no.1 located at Dadri. Only six commercial PFBC demonstration plants (each less than 100MW capacity) are in service around the world. In India, BHEL has undertaken R&D work on a pilot scale and has tested combustion characteristics of certain coal varieties. Only six commercial PFBC demonstration plants (each less than 100MW capacity) are in service around the world. In India, BHEL has undertaken R&D work on a pilot scale and has tested combustion characteristics of certain coal varieties.

8 Barriers to Adoption of IGCC Technology Higher capital cost of the option (0.291) Higher capital cost of the option (0.291) Reliability of the technology suggested is not proven (0.187) Reliability of the technology suggested is not proven (0.187) Inefficient electricity pricing (0.087) Inefficient electricity pricing (0.087) Lack of financing (0.066) Lack of financing (0.066) Low level of awareness about the technology (0.064) Low level of awareness about the technology (0.064)

9 Barriers to Adoption of PFBC Technology Reliability of the technology suggested is not proven (0.178) Reliability of the technology suggested is not proven (0.178) Lack of infrastructure and technical support in the country (0.172) Lack of infrastructure and technical support in the country (0.172) Higher capital cost of the option (0.115) Higher capital cost of the option (0.115) Unavailability of efficient technology locally (0.112) Unavailability of efficient technology locally (0.112) Lack of technical and financial information (0.105) Lack of technical and financial information (0.105)

10 Barriers to Adoption of BIGCC Technology Low level of awareness about the technology (0.258) Low level of awareness about the technology (0.258) Reliability of the technology suggested is not proven (0.178) Reliability of the technology suggested is not proven (0.178) Lack of infrastructure and technical support in the country (0.101) Lack of infrastructure and technical support in the country (0.101) Higher capital cost of the option (0.089) Higher capital cost of the option (0.089) Lack of financing (0.069) Lack of financing (0.069)

11 Comparative Evaluation of Policy Measures for IGCC Technology RankPolicyCost criteria Financiability criteria Effectiveness to remove Administrative criteria Political Acceptability criteria Barrier 1: Higher capital cost of the option 1Indigenous development of the technology Very highLowHighVery high 2Cheaper financing for such projectsHighMediumVery highHighLow 3Capital cost subsidyHighMediumVery highHighLow 4Tax incentivesHighMediumVery highLowHigh Barrier 2: Reliability of the technology suggested is not proven 1Demonstrating use of technology through pilot projects HighDifficult to generate funds Very high 2Provision for local R&D and technical support Very highModerateHighVery highHigh 3Visits to study projects already under operation LowDifficult to generate funds HighLowHigh Barrier 3: Inefficient electricity pricing 1Utilization of funds under CDMLowVery highHigh Very high 2Minimum percentage of power purchase from clean coal generation can be made mandatory LowHigh 3Clean coal / Green certificate trading Very highHigh Very highLow 4Export of powerLow

12 Comparative Evaluation of Policy Measures for PFBC Technology RankPolicyCost criteria Financiability criteria Effectiveness to remove Administrative criteria Political Acceptability criteria Barrier 1: Reliability of the technology suggested is not proven 1Demonstrating use of technology through pilot projects HighDifficult to generate funds Very high 2Provision for local R&D and technical support Very highModerateHighVery highHigh 3Visits to study projects already under operation LowDifficult to generate funds HighLowHigh Barrier 2: lack of infrastructure and technical support in the country 1Technical institutions should impart training for use of technologies MediumVery difficult to generate funds Very highLowVery high 2Power producers should collaborate for the development of technologies Very highModerateLowMediumLow 3Establishing research centersHighModerateLowVery high Barrier 3: higher capital cost of the option 1Indigenous development of the technology Very highLowHighVery high 2Cheaper financing for such projects HighMediumVery highHighLow 3Capital cost subsidyHighMediumVery highHighLow 4Tax incentivesHighMediumVery highLowHigh

13 Comparative Evaluation of Policy Measures for BIGCC Technology RankPolicyCost criteria Financiability criteria Effectiveness to remove Administrative criteria Political Acceptability criteria Barrier 1: Low level of awareness about the technology 1Demonstrating the use of technology through pilot projects Very highVery difficult to generate funds Very high 2Holding technical dissertations so that awareness about the technology is increased. HighEasy to generate funds MediumLowMedium 3Popularizing the technology through trade fairs, conventions etc. HighEasy to generate funds MediumLowMedium Barrier 2: Reliability of the technology suggested is not proven 1Demonstrating use of technology through pilot projects HighDifficult to generate funds Very high 2Provision for local R&D and technical support Very highModerateHighVery highHigh 3Visits to study projects already under operation LowDifficult to generate funds HighLowHigh Barrier 3: lack of infrastructure and technical support in the country 1Technical institutions should impart training for use of technologies MediumVery difficult to generate funds Very highLowVery high 2Power producers should collaborate for the development of technologies Very highModerateLowMediumLow 3Establishing research centersHighModerateLowVery high

14 Conclusions The identified policy measures to overcome the barriers include financial as well as technical measures. The identified policy measures to overcome the barriers include financial as well as technical measures. Financial measures include tax incentives, financial support and utilization of CDM credits. Financial measures include tax incentives, financial support and utilization of CDM credits. Technical measures emphasize demonstration of these technologies in the Indian context and improving awareness towards the same. Technical measures emphasize demonstration of these technologies in the Indian context and improving awareness towards the same. Availability of technical know how is not expected to translate to adoption of such technologies. Effective policy support, together with awareness and technical support would provide an impetus to adoption of clean and energy efficient technologies. Availability of technical know how is not expected to translate to adoption of such technologies. Effective policy support, together with awareness and technical support would provide an impetus to adoption of clean and energy efficient technologies. The National Electricity Policy and the National Tariff Policy can mandate technology choice as a part of generation or procurement portfolio and providing additional tariff support through appropriate regulatory measures. The National Electricity Policy and the National Tariff Policy can mandate technology choice as a part of generation or procurement portfolio and providing additional tariff support through appropriate regulatory measures.

15 Thank you


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