New Delhi: In press, we hear a lot about coal plant retirement in India. The central electricity authority (CEA) has identified approximately 50 GW for environmental reasons, and academic research has identified approximately 100 GW based on economic reasons. There is similar work from the council of energy environment and water (CEEW). But we see little action on ground.
The reality is that it is not going to be easy, given the key role of coal power in India. Coal power still produces more than 70 per cent of India’s power, and this has risen to close to 80 per cent in recent times. Furthermore, quitting coal power requires addressing issues around lowest costs reliable power supply, energy security, and just transition.
So, what is a reasonable strategy going forward given various guardrails? First, we need to keep in mind what India has proposed at COP26, because a global commitment may be easier to track. Second, we also need to keep in mind what the ground realities are. Finally, we need to think about a reasonable transition strategy.
At COP26, India has committed 500 GW of renewable energy (RE) capacity by 2030, plus a commitment of 50 per cent generation from RE. Let us look at what it means for India’s implicit assumptions around coal power. 500 GW of RE at 25 per cent PLF – a ballpark number for RE – is equivalent to 125 GW RE generating at full capacity (i.e., at 100 per cent PLF). Assuming the rest mostly comes from coal – a reasonable assumption for India given limited generation from gas, hydro and nuclear – this means approximately 200 GW coal power capacity at 60 per cent PLF, which is equivalent to approximately 120 GW coal power capacity generating at 100 per cent PLF. That is, given 200 GW coal power capacity, 500 GW RE is equivalent to 50 per cent generation by RE. This is, in fact, supported by system simulation studies.
This implies that, given current coal power capacity at approximately 200 GW, coal power capacity is assumed to be invariant until 2030. This further means that the 50 GW capacity to be retired, as proposed by CEA, is replaced by 50 GW new capacity that, incidentally, is already in the pipeline. After 2030, we don’t know what happens, but that’s where battery storage (BESS) and hydrogen can become a bigger part, the remaining 200 GW coal power capacity is phased out, without any additional new coal power capacity ever.
In the meantime (i.e., in 2020s), we can show that just transition is possible on the 50 GW slated for retirement by CEA. Given that an official agency (i.e., CEA) is engaged, this process is likely to encounter the least friction. This can then create a blueprint for larger scale phase down, as India calls it, in the 2030. In this context, multilaterals, such as the World Bank (WB) and the Asian Development Bank (ADB), in coordination with the Climate Investment Funds (CIF) can play a significant role by providing technical assistance and concessional finance. This is already under works in the Accelerating Coal Transition (ACT) program of CIF.
Source: dailyenergynews.com
