ISSUES AND EXPECTATIONS OF CSP

INTERSOLAR INDIA 2012

November 5, 2012
AGENDA
1. Issues from Phase I
2. Expectations for Phase II
3. Initiatives for deployment, cost
reduction and global leadership
ISSUES FROM PHASE I
1. Site selection
a. Low DNI
b. Dust
c. Deep foundations
2. Non recourse financial closure
3. Low price bids (due to selection criteria?)
4. Land availability and consolidation
5. Grid Infrastructure
6. Auxiliary Power
7. Completion time
8. Water availability
EXPECTATIONS FOR PHASE II
1. Split between CSP & PV
2. Accurate SRRA data (ground truth) for better
estimation from satellite (with known deviation)
3. Mechanism for non recourse financial closure
4. Project feasibility
5. Selection criteria (to avoid low bids)
6. Special incentives for
a. Thermal storage
b. Air cooled system (low water requirements)
c. Small systems with storage for remote rural
SPLIT
1. Preference to CSP in split
a. PV projects viable under REC mechanism
b. CSP technology provides better opportunities
i. Thermal storage for 24 x 7 operation, meet peak
power
ii. Integrate-able with conventional power plants
iii. Suitable for remote rural
2. Co generation
a. Water purification & desalination
b. Cold storage
SELECTING PROJECT SITES
1. 51 CWET solar meteorological stations one year DNI data
published in paper presented* at Solar Paces 2012
a. 1,702 KWh/m2/year (highest in Rajasthan Phalodi)
b. 1,397 KWh/m2/year (highest in Tamil Nadu Chennai)
c. 1,600 KWh/m2/year (average from 13 stations in Rajasthan)
d. 1,300 KWh/m2/year (average from 9 stations in Tamil Nadu)
e. Cannot be considered Ground Truth
2. Unable to use ground data (ground truth) for satellite
estimations, the most popular methodology for
1. Site selection (solar GIS maps)
2. On-site estimation of solar resource for life of project (30 years)
3. Solar resource estimates required project design, feasibility leading
to financial closure
Solar Resource Assessment and Mapping of India
by Dr. A. Kumar, MNRE; Dr. G. Giridhar, CWET; I. Mitra, GIZ etc
NON RECOURSE FINANCIAL CLOSURE
1. Empanel internationally recognized third parties, initially for
a. Yield estimation, project cost and feasibility calculations Solar
resource estimation
b. Technical DUE DILIGENCE
c. Develop and establish methodology for assessing bankability
d. Develop local competence, encourage JVs
2. Develop mechanism for 3
rd
party guarantees to mitigate risk
to Lenders
a. Spain: EPC guarantees (hikes up project costs)
b. USA: Loan guarantees, tax benefits
3. Viability Gap Funding will ease situation
SELECTION CRITERIA
1. Unreasonably low bids (in reverse bidding
scheme), many feel
a. Not a true representation of costs
b. Projects may not be successful (either financially or
technology)
2. Has kept experienced foreign technology players
and investors out
a. Good for indigenous development
b. May be bad for future growth: especially technology
penetration, project finance
3. Need strong pre-selection criteria for bidding
a. Bankability
b. Technology
PROJECT FEASIBILITY
1. CSP projects require at least one year of pre-
project work at significant cost
a. Developers reluctant to invest due to
uncertainty in winning projects, leading to
i. Unrealistic bids
ii. Lack of non recourse financial closure
2. Current REC scheme (5-year tariff) not viable
for CSP
a. 2 3 years for project commissioning
SPECIAL CONCESSIONS
1. Notification of special Tariff by CERC for
a. Air cooled systems
i. Lower efficiency, higher cost
b. Small capacity 24x7 systems for remote rural
i. With storage or hybridized for 24x7 operation
ii. Lower efficiency for smaller size
c. Hybrid systems (existing or new plants)
i. To encourage existing (and new) conventional plants to
reduce fossil fuel usage and increase deployment
2. Encourage thermal storage through special
mechanism (higher percentage of VGF)
INITIATIVES FOR CSP
1. Solar resource assessment (based on satellite
estimation, in absence of ground data)
2. Benchmarking performance of CSP
projects/components
3. Test facility (CIEMAT, SNL)
4. Demo facility (PSA)
5. R&D investment support
SOLAR RESOURCE ASSESSMENT
1. Development of
a. Quality monitoring and Data Correction
system/software for all available ground data
b. Satellite based modeling (with deviations from
ground truth) from
i. Meteosat
ii. INSAT (Indian satellite System)
c. Solar resource GIS maps from 11-year satellite data
(in the absence of accurate & reliable ground data)
d. Technology for nowcasting
BENCHMARKING & TECHNOLOGY
1. Benchmarking
a. Test facility for testing & monitoring performance
b. Field data for on-site performance
2. Technology
a. PSA type facility for evaluation and development of
new technologies
3. Committee to identify requirements
4. Awards to be on open tender system (IIT-J
example)
R & D INITIATIVE
1. Committee to identify R & D technologies for
indigenous development
2. Ministry to provide partial funding for
development
3. Open tender system for award of projects,
based on existing infrastructure/experience
for manufacturing
SUMMARY
CSP needs nurturing
SRRA project
R&D, indigenization
Thermal storage technologies
Better split in Phase II
REC mechanism, tariff, continuity
Reappraisal of CSP-specific issues from Phase I
Current initiatives in right direction, need better
quality of the results
Better monitoring, more transparent processes
CONTACT
LAVLEEN SINGAL
lavleen@acirasolar.com
+91 99100 61150
+91 11 4156 2950