Well timed implementation of market reforms key to enhance monetary viability of PSP: ICRA

NEW DELHI : The well timed implementation of market reforms is vital to enhance the monetary viability of pumped storage hydro challenge (PSP) within the nation, in accordance a report by rankings company Icra Ltd.

In response to the report, the levelised tariff for pumped storage hydro tasks within the base case (capital price of 6.5 crore per MW and 16.5% return on fairness) is estimated at 4.98 per unit whereas the landed tariff together with price of vitality required for pumping is estimated at Rs. 8.92 per unit. 

“Well timed implementation of market reform proposals as highlighted within the draft pointers additionally stays vital to enhance the monetary viability of PSPs,” it stated.

ICRA stated that the pumped storage hydro tasks have an extended financial lifetime of 40 years, are based mostly on very mature and indigenous expertise and are environment friendly. They’re additionally price aggressive. 

The levelised price (capital price of 250 USD/kwh) utilizing BESS is estimated at Rs. 11.1 per unit which is twice the bottom case price estimate (conversion) of Rs. 4.98 per unit for pumped storage hydro tasks.

‘’Nonetheless, the well timed implementation of market reform measures as highlighted within the pointers stays vital to enhance the monetary viability of PSPs,‘’ said Girishkumar Kadam, Senior Vice President & Co-Group Head – Company Scores, ICRA.

It added that with enhance in put in renewable vitality capability, the share of renewable vitality (RE) energy in electrical energy era is anticipated to extend from 11.5% in FY2022 to twenty-eight% by FY2030. Rising sources of intermittent energy (wind and photo voltaic) would necessitate increased storage capability for sustaining grid stability.

The rules comprise numerous measures reminiscent of for the monetization of ancillary companies, exemption from free energy obligation / native space improvement fund, state GST reimbursement, and rationalization of atmosphere clearance. 

The pumped storage hydro tasks (PSPs) provide important advantages within the type of frequency regulation, storage/ time shifting, ramping functionality, black begin functionality, peak shaving, reactive energy and voltage management, and spinning reserves. They’re, subsequently, greatest suited to supporting grid operations.

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Up to date: 25 Apr 2023, 08:35 PM IST