New Delhi: India is preparing a major push to unclog its increasingly stretched green power grid, with the ministry of new and renewable energy (MNRE) set to shortly seek Union cabinet's approval for the over ₹50,000-crore third phase of India's green energy corridor, according to two government officials.
The much-awaited new phase will strengthen intra-state transmission networks in renewable energy (RE)-rich states, including Gujarat, Rajasthan, Karnataka, Maharashtra and Andhra Pradesh, they said. Most of the projects under this phase are expected to be in Gujarat, followed by Rajasthan.
The push comes as India’s rapid addition of solar and wind capacities outpace the grid’s ability to evacuate the power, forcing generation curtailment and emerging as a key hurdle to the country's 2030 clean energy goals.
The proposal has already got the go-ahead from the finance ministry's expenditure finance committee (EFC) and has also cleared other requirements ahead of cabinet consideration, the officials said.
The scheme is expected to include intra-state systems to support renewable energy-rich states and states with emerging RE markets, with the parent ministry for support to offset high costs, reduce tariffs, and eventually attract private investment, the officials said.
The development assumes significance amid rising share of renewable capacity and instances of generation curtailment due to transmission capacity constraints. The scheme will aim to develop transmission and power transformation capacity–substations across the renewable energy-rich states.
India has recorded an electricity curtailment equivalent to 18% of the average monthly solar generation of 13 terawatt hours (TWh), which is resulting in compensation payouts.
“We are doing two things under the green energy corridor: developing new lines and also augmenting existing substations and transmission lines. The scheme will next be taken to the cabinet,” said one of the two government officials cited above, with both requesting anonymity.
“The scheme size will be over ₹50,000 crore. All other approvals required prior to cabinet approval have been received,” said the second official.
Curtailment of solar and wind power generation takes place due to inadequate transmission capacity despite the growing renewable energy capacity in the country. India’s ambitious solar power goals amid inadequate transmission and electricity storage capacity has spooked the country’s power grid with stability concerns.
Industry participants say transmission, not generation, is the binding constraint on India's energy transition.
Sanjeev Aggarwal, founder and executive chairman, of I Squared Capital-backed Hexa Climate, said, “We are already curtailing clean power as the grid simply cannot evacuate, and one in four inter-state schemes is running a year or more behind."
"Against that, a ₹50,000 crore phase-III is the right order of magnitude, and structuring it as a competitively-bid PPP (public-private partnership) , with private developers carrying right-of-way risk and performance penalties, is exactly the accountability the earlier phases lacked," Aggarwal said.
He, however, sees the real test in sequencing, as the corridors have to be commissioned ahead of the plants they are meant to evacuate, not two years after.
Aditya Malpani, senior director and regional head, business development (West) at AMPIN Energy Transition, said the plan is absolutely crucial to maintain the must run status of renewable energy projects. “With the expansion of dedicated transmission corridor for RE projects, it will resolve the curtailment issues being faced by developers, ultimately helping the grid/discoms," he added.