ENERGY NEWS MARCH-2020

Petroleum Conservation Research Association Sanrakshan Bhawan 10, Bhikaji Cama Place

New Delhi 110066

INDEX

S. NO. SUBJECT PAGE

1

1.1

1.2

2

2.1

3

3.1

4

4.1

4.2

5

TRANSPORT

-E-Vehicles (EV)

-Oil & Gas run vehicles

ENVIRONMENT

- Air, Water & Sound pollution

ENERGY CONSERVATION

-Oil & Gas

RENEWABLE ENERGY

-Wind

-Solar

OTHERS

1-11 11-12 12-17 17-24

24-25

26-35

35-37

This Energy News contains excerpts of articles picked up from selected daily newspapers & magazines.

1

Efficiency Parameters Soon to Aid EV Battery Swapping

The government will soon frame efficiency parameters for batteries powering

electric vehicles (EVs) as it invites bids for setting up gigafactories or giant

battery plants in India. A high-level panel has been set up under the Bureau of

Energy Efficiency to frame performance criteria and efficiency parameters that

can help battery swapping in EVs. A senior government official told ET that

there was an agreement at a NITI Aayog CEO Amitabh Kant-led meeting last

month on battery swapping option to be adopted for quicker uptake of EVs and

hence the need for standardisation of advanced chemistry cells.

“A high-level panel has been set up to determine this,” said the official.

“Standardisation of form factor would allow interoperability, thus catalysing

the uptake of EVs.”

Battery swapping will allow consumers to replace depleted batteries with fully

charged ones in just a few minutes instead of recharging, which can take several

hours, but this can only happen once standards and parameters are in place

and adhered to by all battery manufacturers. According to the official, the

government wants Made in India batteries to be technologically agnostic

wherein the efficiency of the cell as well as life cycle is defined. While safety

2

and mechanical parameters for lithium-ion batteries are already in place, the

government now wants to define the performance parameters for batteries or

advanced chemistry cells. NITI Aayog, the government’s premier think tank, has

been driving the government’s mission on transformative mobility with quicker

transition to EVs with the objective of cleaning up Indian cities and ensuring

India reduces its dependence on imported fuel. The Aayog will soon invite bids

for setting up gigafactories in India with cumulative battery production of 50

GWH. Typically, a gigafactory with 10 GWH capacity requires an investment of

$1 billion. Companies will be awarded the contract based on their net worth,

production capacity, scale-up plan and extent of localisation. One gigawatt hour

of battery capacity can power a million homes for an hour and around 30,000

electric cars. The government has laid out a road map which envisages the

share of EVs in total vehicles sold in the country after 2030 to be 30%.

Conservative estimate shows that by 2030 India would need 60 GWH of battery

for 10 years starting this year.

It is estimated that once battery manufacturing picks up pace in India it will be

possible to bring down the cost of these batteries from $276 per kilowatt-hour

(kWh) to $76 per kilowatt-hour. This is expected to bring the cost of EVs almost

on a par with combustion (engine) cars in the next three-four years. Batteries

account for more than half the cost of an EV. The finance ministry has already

given its go-ahead to the Aayog's ₹700 crore per annum proposal to subsidise

battery manufacturing in India starting 2022.

*****

3

Tata Motors flexes EV muscle, unveils Harrier at ₹13.69-16.25

lakh

Tata Motors, the country's biggest vehicle maker by revenue, on Wednesday

showcased an extensive range of sustainable mobility solutions at the Auto

Expo 2020, here. Going beyond BS-VI by exhibiting new range of passenger

vehicles, the company even showcased commercial vehicles in electric form, to

be launched over the next few years. With its focus on CESS — Connected,

Electric, Shared and Safe — as the future of mobility, the company did four

Global Unveils, a pre-production and a commercial launch, and showcased 14

commercial and 12 passenger vehicles. The ‘HBX Show car’, based on the ALFA

ARC, and the ‘Sierra EV Concept’ — a new avatar of the 1990s SUV, introduced

the ‘Hexa Safari Edition’. Tata Motors also launched the ‘Harrier 2020’ based

on the OMEGA ARC, priced at ₹13.69 lakh for the manual version and ₹16.25

lakh for the automatic version. Tata Motors also unveiled the pre-production

version of its flagship SUV — the Gravitas, scheduled to be launched in the first

half of next financial year. The company also globally unveiled the all-new Tata

Winger and the Tata Prima facelift 5530.

Transformative ecosystem

“The theme of our pavilion is a thoughtful representation of what India needs,

how Tata Motors can contribute, and how we as the Tata Group are taking the

lead in providing a transformative ecosystem solution in India. Tata Group has

taken the lead in driving the government’s vision of electrifying India and

4

building a comprehensive and sustainable ecosystem, by leveraging the

Group’s rich experience and diversified competencies,” Chandrasekaran, Tata

Sons.

“Each product at the Tata Motors pavilion is a careful, practical and emotional

work of art, designed to provide more delight to its customers. The pavilion is

designed on CESS, our four technology pillars, which are revolutionising the

mobility agenda,” said Guenter Butschek, chief said N Chairman, Executive

Officer and Managing Director, Tata Motors. The recently launched Tata

uniEVerse is a holistic approach addressing all aspects of e-mobility solutions,

from infrastructure to charging networks and a phase-wise manufacturing plan,

to provide consumers a futureready sustainable and efficient e-mobility

environment, he said.

*****

Mahindra says it’s looking for a partner in electric unit

Mahindra and Mahindra Ltd (M&M), India’s largest electric vehicle maker by

sales volume, is exploring partnerships with global manufacturers to jointly

develop electric vehicles and their powertrains, managing director Pawan

Goenka said. This will include a potential stake sale in its wholly-owned

subsidiary, Mahindra Electric, Goenka said in an interview on Thursday. Unlike

rivals, M&M has made its electric vehicle (EV) business a separate unit and has

also set up a base for developing and manufacturing such vehicles and

components on the outskirts of Bengaluru. Goenka said the global sales volume

for EVs is still low, while the number of companies entering the segment is fairly

large, which includes traditional automakers as well as startups.

“Therefore, collaboration will be the key in powertrain, which means the

battery, the motor, power electronics and the charger. That’s the reason we

have set up Mahindra Electric as a separate company, but now we have started

to see how we can get strategic partners, so that we can pool in our volumes

and create an electric powertrain supply company,” he said, adding that the

company would function like a consortium of manufacturers.

5

“We are talking to various OEMs (original equipment manufacturers) who are

interested, take equity in Mahindra Electric and become partners,” Goenka

said.

He said the EV business was still at an early stage. “Right now everybody is in a

pilot phase and if am selling 100 vehicles (EVs) per month at a loss, then I can

afford it. It will get lost in my remaining 15,000 vehicles but then if I am selling

10,000 vehicles, then I cannot afford to sell at a loss.”

M&M has a track record of partnering competing carmakers to develop

products and platforms. In the 1990s, it tied up with Ford Motor Co. as well as

French automaker Renault SA, though both the partnerships were later

shelved.

“I think it’s important to have that partnership to make electric vehicles

commercially viable. Second partnership (after powertrain) will be at the

platform level and OEMs who have developed a very well-engineered platform

and they are opening that platform to others to license. Third will be sharing a

product under different company names,” Goenka said. M&M plans to supply

and export EV powertrains to other EV producers.

*****

ETO Motors to facilitate clean, efficient connectivity for Delhi

Metro passengers

ETO Motors, an Electric Mobility as a Service Provider, has announced its move

to commence e- rickshaw first mile and last-mile services at select metro

6

stations in Delhi. The Consortium led by ETO Motors along with its partner

Goenka Electric Motor Vehicles Private Limited has received the expression of

interest (EOI) from the Delhi Metro Rail Corporation Limited to kick-start the

operations of these services in the national capital. ETO Motors plans to launch

the services by March 20, 2020. It will provide clean, safe and shared first- and

last-mile connectivity to passengers of Delhi Metro. DMRC has permitted the

consortium following successful demonstration of capabilities of functional and

operational requirements of e-rickshaws on January 13, 2020, and allowed it to

commence operations at Yamuna Bank, Sukhdev Vihar, Jamia Milia Islamia and

Jasola Vihar Shaheen Bagh metro stations in Delhi. According to the EOI, the

consortium will be allotted dedicated space for parking/stabling of e-rickshaws

and battery charging points for the purpose of pick-up and drop-off of

passengers at these respective metro stations. ETO Motors, a full-fledged

electric mobility solutions and services company, which deploys multi-brand

shared electric diverse fleets for cleaner cities. These fleets provide clean, safe,

noise-free public transportation for first mile, last mile, and intra-city

operations. Biju Mathews, Chief Executive Officer, ETO Motors, said, “Our

consortium has received the letter of acceptance from DMRC to launch our e-

rickshaw services across four metro stations in Delhi. We are committed to

providing clean, safe and shared mobility to the people of Delhi while ensuring

lower carbon footprint. Our affordable mobility service will help passengers

save on their travel expenses each day. With the launch of e-rickshaw services

in these four metro stations, we would be catering to around 25,000 passengers

daily.”

As per the EOI, the consortium will follow certain guidelines issued by DMRC

which include providing the list of all e-auto models to be run from metro

stations in advance to the Corporation. The e-rickshaw operator should also

ensure that the drivers must wear a prescribed uniform, and display valid ID

card and name badge while in service. All drivers will possess a valid driving

license. A Project Manager will also be appointed to oversee the day-to-day

operations of e-auto services. Besides providing e-rickshaw services for both

Delhi-NCR and Noida Metro Rail, ETO Motors is poised to launch both its e-auto

and e-rickshaw services in the top 10 cities in the coming financial year by

7

introducing about 5,000 electric mobility service units in the passenger

segment and around 2,000 cargo vehicles for large e-commerce players.

*****

Delhi’s all charged up for green drive

In tune with the Delhi Electric Vehicle Policy 2019, the discoms in the capital

are eyeing a network of more than 280 charging stations for e-vehicles (EVs) by

the end of this year. While Tata Power, which has 12 charging stations, is

planning 50 new ones, the two BSES discoms are trying to add 179 to their

existing infrastructure. BSES, which now has 45 stations, expects to get nine

more by March 31, taking the count to 54. BSES has gone into partnerships with

8

several organisations to set up smart EV charging stations across its licensed

areas, said an official. A Tata Power official pointed out that as Delhi

government had been focusing on scaling up the use of electric vehicles in the

next five years, the vehicles running on clean fuel would need these additional

charging stations for smooth operation. The e-vehicle policy aims at curbing

vehicular pollution by adding five lakh EVs in five years and focuses on its key

contributors — two-wheelers, shared transport vehicles and goods carriers or

freight vehicles. To improve Delhi’s air quality by bringing down emissions from

the transport sector, the policy wants to drive rapid adoption of battery electric

vehicles in such a way that they constitute 25% of the new vehicle registrations

by 2024. Delhi government itself has been targeting induction of 35,000 electric

two-, threeand four-wheelers, 1,000 electric vehicles for last-mile

connectivities and 250 public charging and battery-swapping stations.

The BSES official said the company had signed a memorandum of

understanding with Ola Electric for setting up batteryswapping and charging

stations at mutually identified spots. “While BSES Rajdhani Power Limited will

set up the stations in south and west Delhi, BSES Yamuna Power Limited (BYPL)

will do so in east and central Delhi to hasten the adoption of EVs in the city.

Two- and three-wheelers will be able to avail both services at these stations.

Electric cars can also be charged at some of these stations,” he added. Battery-

swapping stations will virtually eliminate the wait time for charging, thus

removing a major impediment in the adoption of EVs. Such measures will

provide the much-needed trigger to increase the penetration of EVs in Delhi

and go a long way in reducing pollution, the official claimed. Space constraints,

however, may prove to be a hurdle in setting up more charging stations. “It may

pose a slight challenge in certain pockets when the number of electric vehicles

increases significantly. The authorities and various landowning agencies will

then have to proving land for more stations,” the official said.

*****

9

Future’s electric: Green rush at Expo, but prices will pinch

If anybody had any doubts about the ability of automakers to bring out electric

vehicles, the Auto Expo should dispel those. Even as companies complain of

affordability issues and severe lack of charging infrastructure, electric cars were in

the limelight at the expo with carmakers literally falling over one another to

showcase their green rides. In fact, the show opened with the glimpse of a futuristic

electric concept as Maruti Suzuki unveiled the FUTURO-e — a highly (internet)

connected car that runs on electric but can have hybrid drivetrain capabilities — as

its showstopper. But the bigger electric push, especially in the mainstream end of

the market, seemed to be coming from the homegrown boys — Tata Motors and

Mahindra & Mahindra. Mahindra launched its smallest electric SUV in the green

version of KUV1OO, which has been priced at Rs 8.25 lakh (ex-showroom). It also

showcased an electric version of its XUV3OO SUV and also unveiled Atom, a mini

multi-passenger urban mobility electric vehicle. The vehicles will be launched over

the coming few months. The showstopper for Tata Motors was surely the

reimagined Sierra SUV, which has now gone green and was displayed as a concept.

The company, which recently launched an electric version of the Nexon SUV, also

displayed a green version of the Altroz hatch. Tata Sons Chairman N

Chandrasekaran was present at the pavilion as Tata Motors MD Guenter Butschek

and senior officials like Girish Wagh (the creator of Nano) unveiled the new cars.

Foreign makers were not behind with Renault bringing a retinue of electrics in mini

cars like Zoe and Twizy while the flamboyant Symbioz was also displayed. The

company plans to drive in the electric version of the Kwid next year, but has

highlighted the need to have better charging infrastructure and subsidies for mass

adoption. Kia, which has had a strong opening in the Indian market with the Seltos

SUV, showcased the Niro and the Soul electrics and said that green mobility is a

focus as it works on the “right products and price points” for India. But some of the

biggest electric displays and unveilings came from the Chinese brigade. While

makers like SAIC (owner of MG Motors), Great Wall and FAW (Haima brand)

displayed some of the petrol-diesel cars that they plan to drive in soon, they did

not show any lack of enthusiasm when it came to green cars. MG Motors, which

recently launched the electric ZS electric car in India, showcased green cars such as

Marvel X (SUV), and E200 mini city car concept.

10

Tata Safari Sierra: Brings back the memories of the old Sierra SUV, which was a

brainchild of none other than Ratan Tata. The Sierra concept electric carries a

modern and progressive look and is a head-turner

VW ID Crozz: The concept SUV is young and flashy, and promises a driving

range of up to 500km. It has a top speed of 180kmph and can be charged up to

80% in 30 minutes. It may also make its way to India

Renault ZOE: It is Europe’s best-selling electric hatchback, and was first revealed

at the 2012 Geneva Motor Show. Can charge around 80% in one hour and 10

minutes. It offers a peak range of around 400km and boasts of features like a 10-inch

digital instrument cluster, a 9.3-inch touchscreen info system, leather upholstery,

wireless smartphone charger and an electric parking brake

Kia Niro: Energy and power for the Niro EV come from a cutting-edge, liquid-

cooled 64kWh lithium-ion polymer battery and powerful electric motor. The long-

range battery, packaged under the floor of the vehicle to maximize cabin space for

passengers, gives the Niro EV a range of 450km from a single charge

Haima EV 1: The electric hatchback from the Chinese company will be available

in the range of Rs 10 lakh. It may be manufactured in India and is likely to be

introduced in two variants with driving ranges of 200km and 300km per charge

*****

EVs a $300 m Opportunity for Tata AutoComp

Tata AutoComp plans to invest more than ₹500 crores to set up new plants and

localise electric vehicle parts, as momentum in favour of cleaner vehicles

gathers speed. The Tata Group company is forming a division within the

company for electric vehicles and it will be headed by AK Jindal, who was earlier

heading R&D at Tata Motors. Tata AutoComp sees this division to account for a

quarter of its overall business in the coming five years, accounting for a

minimum of about $300 million. The company has stitched together multiple

joint ventures and partnerships over the last 12-18 months to provide endto-

end solutions for electrification in segments from trucks to two-wheelers.

Managing director Arvind Goel said Tata AutoComp would invest over ₹1,000

11

crores in the coming two to three years and more than 50% of this would be in

the electric vehicle business.

“We are going full hog in participating in the group’s electrification journey.

Right now, we are at a starting point, but as the segment evolves, we will be

able to supply almost 60% content of an electric vehicle,” said Goel.

Last month, Tata AutoComp entered into a 50:50 joint venture with Prestolite

Electric, China’s second largest electric vehicle motor manufacturer, for local

production of starter, motor and alternators. For the charging station, the

company has signed an MoU with Australia’s Tritium. Exactly a year back, it had

signed a 60:40 JV with Gotion, which is into the battery pack and battery

management systems.

***** China virus outbreak could hit transition to BS-VI

The coronavirus outbreak in China threatens to upset the Bharat Stage-VI

transition plans of the Indian automobile sector—particularly makers of diesel

vehicles and two-wheelers—several industry executives said. Automobile

parts, such as catalytic converters, particulate filters and fuel injection systems,

which are integral to a BS-VI engine, are directly or indirectly imported from

China and the virus outbreak could disrupt the supply chain. Companies,

including Tata Motors, Mahindra and Mahindra, Hyundai Motor India, Kia

Motors India, Hero MotoCorp, TVS Motor and others in the segment, are likely

to witness a production cut, as manufacturing activity in China and in some

parts of South Korea has been affected, said four people aware of the

development. Most of the above-mentioned vehicle manufacturers are now

searching for alternative sources to source the components, which is likely to

take some time. Tata Motors has already informed its stakeholders about a

possible production hit while it looks for alternatives. South Korean vehicle

manufacturer Hyundai is also expected to reduce production as its plants in

Korea have shut down. On the other hand, manufacturers of components, such

as Continental AG and Bosch, mostly import the parts from China and other

countries. Hence, HeroMotoCorp and Chennai-based TVS Motor have guided

for a 10% cut in production during the current month. Most manufacturers in

12

the Indian market will be directly or indirectly impacted by the shutdown in

China, but the lack of engine parts is likely to slowdown the production of BS-

VI compliant products.

“Hyundai Motor India Ltd has smooth product operations as per business plans,

and has not seen any impact as of now. As a matter of prudence, the situation

is being monitored closely, and any necessary action may be taken as per the

market situation,” said a Hyundai spokesperson. A Tata Motors spokeswoman

said the company will not be able to respond on the developments.

*****

₹4,400 CR FOR CLEANING AIR

The Union government has allocated ₹4,400 crores to deal with air pollution in

cities with a million-plus population, up from ₹460 crores last year. Apart from

the financial boost to large cities implementing the National Clean Air

Programme (NCAP), Union finance minister Nirmala Sitharaman said state

utilities will be advised to close down old thermal power plants that do not

meet the emission standards.

“There are yet thermal power plants that are old and their carbon emission

levels are high. For such power plants, we propose that utilities running them

13

would be advised to close them if their emission is above the preset norms. The

land so vacated can be put to alternative use,” she said in her budget speech.

Experts say closing old thermal power plants will be a big step forward in

curbing air pollution and meeting India’s nationally determined contribution

under the 2015 Paris Agreement, which aims to limit a rise in average world

temperatures to below 2 degrees Celsius above pre-industrial levels. Eleven of

29 thermal power plants identified for closure have been shut down.

“More than 30 GW coal-based electricity generation capacity operational in

India is older than 25 years. These older power plants are a big threat not just

to the environment and public health but also to the economy. Shutting down

the older coal-based plants and replacing those with renewable energy is the

only way forward for India. Good to see this emphasis by the finance minister

in the budget speech today, even though it was mentioned as an advisory, but

it shows the government direction and is a positive move,” said Centre for

Research on Energy and Clean Air analyst Sunil Dahiya.

Sitharaman said the million-plus cities attempting to improve air quality may

receive monetary incentives from the Centre. “The parameters for the

incentives would be notified...”

HT reported on January 12 that a year since its launch on January 10 last year,

only about ₹172 crores have been disbursed under the NCAP to 102 cities that

did not meet the annual PM10 (coarse, pollution particles) national standard

from 2011 to 2015. Of the 102 cities, 28 had recorded PM10 concentration of

more than 90 micrograms per cubic metres from 2011 to 2015. Air pollution

experts said a budget of under ₹500 crores to deal with a public health crisis

like air pollution is grossly inadequate. In this year’s budget, the ₹4,400 crore is

a commitment made by the finance minister but does not reflect allocations

made for programmes under the environment ministry.

“This jump in financial commitment for clean air action in million-plus cities is

welcome. But it is not clear how this will be disbursed for multi-sector action

for verifiable mitigation and to meet NCAP target. The environment ministry is

expected to design schemes and incentives to leverage this fund. But this

proposed budget of ₹400,000 core for clean air action in cities is not showing

14

up in the allocated budget for the environment ministry, which is about ₹3,100

core. We need more details on this. But this spending must ensure a verifiable

reduction in pollution in targeted regions,” said Centre for Science and

Environment (CSE) executive director Anumita Roychowdhury. The NCAP aims

to reduce the concentration of PM2.5 (fine, respirable pollution particles) and

PM10 in 102 cities by 20% to 30% by 2024 over the 2017 annual average levels.

It has been criticised for not having a legal mandate for implementation. The

NCAP depends on a collaborative and participatory approach, which means it is

not mandatory that cities meet the NCAP targets. It also does not have a

regional focus and is largely a city-oriented plan. In a piece in peer-reviewed

journal Proceedings of the National Academy of Sciences of the United States

of America in May 2019, air pollution scientists Joshua Apte and Pallavi Pant

wrote the NCAP would be far more effective if it focused on a regional approach

as against city-level plans.

*****

Forest fires causing Gangotri Glacier to melt faster: Study

The black carbon concentration that contributes to faster melting of glaciers

has almost doubled on the Gangotri Glacier, where the Ganga drains out of in

Uttarakhand, over the past few years primarily because of the forest fires, a

study by Dehradun-based Wadia Institute of Himalayan Geology (WIHG) has

found. PS Negi, a WIHG scientist, said black carbon is a kind of an aerosol (fine

solid particles or liquid droplets). “Among aerosols, black carbon has been

recognised as the second most important anthropogenic agent for climate

change and the primary marker to understand the adverse effects caused by air

15

pollution,” he said. Negi said they have been monitoring black carbon through

two weather stations on the route to Gangotri glaciers at Chirbasa (3,600 m),

and Bhojbasa (3,800 m) for the last few years.

“Analysis of the data from these weather stations in real-time has helped us to

know about black carbon concentrations and seasonal variations in the higher

Himalayas. We have found that the concentration of black carbon increases in

summer months due to varied factors. We have found that a range of black

carbon up to 4.62 micrograms per cubic metre,” said Negi.

In summer, the concentration comes down to about 2 micrograms per cubic

metre of air indicating that forest fires and tourism activities in the state

contribute to higher concentration of black carbon on glaciers, he added.

“Period from April to June showed a remarkable increase in black carbon

concentration primarily due to direct and indirect activities related to tourism.

Also, forest fires contribute to increasing black carbon concentration,’’ said

Negi. He added they found high black carbon concentration during September

and October. “The lowest black carbon concentration has been recorded during

August followed by December, likely due to the absence of tourist activities and

forest fire incidences.”

Negi said the main local sources of black carbon observed during field study

include forest fires, domestic and commercial fuel wood-burning and seasonal

burning of crop residue. According to Forest Survey of India, forest fires are

generally reported in Uttarakhand from February to June. Besides man-made

reasons, other causes of fires include lightning. Over 44,554 hectares of the

forest area was damaged in forest fires in Uttarakhand since 2000, according to

the state data. Negi said black materials absorb more light and emit infrared

radiation, which increases the temperature. “So effectively, when there is an

increase in black carbon in the higher Himalayas, it will contribute to faster

melting of the Himalayan glaciers.” Developmental activities, pollution from

local, regional and global sources accumulate over the Himalayan region and

increase the concentration of black carbon.

*****

16

Global warming: Tata Steel brings a ‘green’ touch to

production

Tata Steel has piloted a new process for production of steel, one it says “results

in enormous efficiency gains” and reduces energy use and carbon dioxide

emissions by a fifth of that in the conventional blast furnace route. The

company has tested this “completely new technology for producing steel” in

five pilot plants in Europe; the next step is to bring a commercial scale plant to

India. The process, called HIsarna, is a combination of Isarna and Hismelt, the

Celtic words for iron and melting vessel, respectively. The company has spent

$75 million in developing the technology at its steel plant in Ijmuiden, The

Netherlands. In a conventional blast furnace, the ‘flux’ – a mixture of iron ore,

coke and limestone – is put into the furnace and a blast of oxygen is sent in

through a lance. The mixture melts and collects at the bottom. In HIsarna, the

ore is liquefied in a high-temperature cyclone at the top and the molten ore

drips to the bottom of the reactor, where powder coal is injected.

“The technology removes a number of pre-processing steps and requires less

stringent conditions on the quality of the raw materials used,” says a Tata Steel

note on the technology. Since it is highly concentrated carbon dioxide that

leaves the reactor, the system is “ideally suited for carbon capture and either

storage (CCS) or use (CCU), without the need for a costly gas separation stage.”

The combination of HIsarna with storage could slash slash carbon dioxide

emissions by 80 per cent, compared with that in the conventional steel

production process, the company says.

Also read: Tata Steel sales volume up in December quarter A spokesperson of

Tata Steel, told BusinessLine that the company is “currently in the process of

upscaling the design towards commercial scale”. He said the company intends

to have the first scaled-up plant in India, and subsequently build a commercial

plant in Ijmuiden.

“The commercialisation of the process will require significant engineering

efforts and investment,” the spokesperson said. Asked about the investments

that a commercial plant would require, he said that would depend upon the

17

“location, existing infrastructure and the desired configuration”. Engineering

teams in India and Europe were working together “to ensure earliest realisation

at both locations,” the spokesperson said. The steel industry is among the

largest emitters of carbon dioxide, the prime culprit in global warming. A recent

report by The Energy and Resources Institute (TERI), one of India’s leading

research bodies, noted that the Indian steel sector would likely triple its carbon

footprint by 2020, given the need to produce more steel. TERI estimates that

CO2 emissions from the steel industry would jump to 837 million tonnes over

the next three decades from 242 million tonnes now, as India’s steel

consumption quadruples to about 500 million tonnes. India has 977 steel plants

currently, which are likely to be very busy as the country upgrades its

infrastructure, spending $ 1.5 trillion over the next five years. Tata Steel expects

HIsarna would “play a pivotal role in meeting the future recycling ambitions of

the circular economy.” The company puts it thus: “Not only do we expect to be

able to combine primary steelmaking with recycling of up to 50 per cent steel

scrap, which is twice the present theoretical maximum of the Blast Furnace –

Basic Oxygen Steel plant route. HIsarna also allows the recovery of zinc from

coated steel scrap.”

*****

18

Oil edges lower as US stockpiles grow more than expected

OilNSE 0.54 % futures edged lower on Wednesday, extending losses from the

previous day, after US crude stockpiles grew more than expected, adding to

worries about oversupply, although a fall in gasoline stocks kept the decline in

check. Brent crude was down 2 cents at $42.61 a barrel by 0045 GMT, while US

West Texas Intermediate (WTI) crude futures fell 4 cents, or 0.1 per cent, to

$40.33 a barrel. US crude inventories rose by a much bigger than expected 1.7

million barrels last week, according to industry group the American Petroleum

Institute (API), well ahead of analysts' expectations for a 300,000-barrel build.

However, US gasoline and distillate inventories fell, the data showed, feeding

optimism that fuel consumption is picking up as some economies ease

lockdowns imposed to contain the coronavirus pandemic. US government data

will be released on Wednesday. Global oil consumption has started to recover

as economies emerge from lockdown, while the Organization of the Petroleum

Exporting Countries (OPEC) and allied producers have slashed output and US

shale producers have shut in wells. On Tuesday, both Brent and WTI contracts

traded at their highest levels since prices collapsed in early March. Still, the

market remains concerned about a rising number of coronavirus cases in the

United States and elsewhere, said Kazuhiko Saito, chief analyst at Fujitomi Co.

New cases of COVID-19 rose 25 per cent in the United States in the week ended

June 21 compared to the previous seven days, a Reuters analysis found. China,

the world's top crude importer, is also expected to slow crude imports in the

third quarter, after record purchases in recent months, as higher oil prices hurt

demand and refiners worry about a second virus outbreak.

*****

19

HPCL reports ₹27.63 crore consolidated loss in fourth quarter

Hindustan Petroleum Corporation Limited (HPCL) has reported a ₹27.63-crore

consolidated loss for the fourth quarter of financial year 2019-20. The company

had reported a consolidated profit of ₹3,340.03 crores in the same quarter of

the previous financial year. Consolidated total income for the period under

review stood at ₹72,059.48 crores (₹73,705.56 crore).

For the full financial year 2019-20, the company reported a consolidated profit

of ₹2,638.73 crores, down from ₹6,690.63 crores in the previous fiscal. The fall

in profits and revenue is because of a significant inventory loss suffered by the

company due to the unprecedented situations arising out of Covid-19. Inventory

loss or gain is a change in the valuation of raw materials and products held by a

company. The company reported an inventory loss of ₹4,253 crores for the

financial year 2019-20. Comparably, there was an inventory gain of ₹1,363

crores in the previous fiscal. During the quarter under review, there was an

inventory loss of ₹4,113 crores. HPCL had reported an inventory gain of ₹1,234

crores in the same quarter of the previous fiscal.

*****

20

Crude boost for India Inc. as global oil demand dips.

The sluggish Indian economy and industries that are heavily dependent on

crude oil such as aviation, shipping, road and rail transportation are likely to

gain from a sudden drop in crude oil prices due to the coronavirus epidemic in

China, the world’s biggest oil importer, economists, chief executives and

experts said. With various industries realigning their strategy amid energy

demand forecasts being slashed due to the coronavirus outbreak, major oil

importers such as India are seeking to drive a better bargain. India is the world’s

third-largest oil importer and the fourth-largest buyer of liquefied natural gas

(LNG). The oil market is currently facing a situation called contango, wherein

spot prices are lower than futures contracts.

“Estimates by several agencies are suggesting that Chinese Q1 crude demand

will be down by 15-20%, resulting in a contraction of global crude demand. This

is reflecting in the prices of crude and LNG, which are both benign for India. This

will help India in its macroeconomic parameters by containing current account

21

deficit, maintaining stable exchange regime and consequently inflation,” said

Debasish Mishra, partner at Deloitte India.

The International Energy Agency (IEA) and the Organization of the Petroleum

Exporting Countries (Opec) have cut global oil demand growth outlook

following the coronavirus outbreak.

“Sectors such as aviation, paints, ceramics, some industrial products, etc, would

benefit from a benign price regime,” Mishra added.

India is a key Asian refining hub, with an installed capacity of more than 249.4

million tonnes per annum through 23 refineries. The cost of the Indian basket

of crude, which averaged $56.43 and $69.88 per barrel in FY18 and FY19,

respectively, averaged $65.52 in December 2019, according to data from the

Petroleum Planning and Analysis Cell. The price was $54.93 a barrel on February

13. The Indian basket represents the average of Oman, Dubai and Brent crude.

“In the past, benign oil price has seen airline profitability improving

significantly,” said Kinjal Shah, vice-president of corporate ratings at rating

agency Icra Ltd.

“This could be a good time for airlines to make up for the losses. Airlines can

use this to recoup losses, while travellers can use this moment to plan for travel

as the cost of air tickets would become more pocket friendly,” said Mark

Martin, founder and CEO at Martin Consulting Llc, an aviation consultant.

The outbreak of coronavirus in China has forced energy firms there to suspend

delivery contracts and reduce output. This has impacted both global oil prices

and shipping rates. Officials at the Indian Chemical Council said India depends

on China for chemicals across the value chain, with that country’s share in

imports ranging from 10-40%. The petrochemical sector serves as the backbone

for various other manufacturing and non-manufacturing sectors such as

infrastructure, automobile, textiles and consumer durables.

“A wide variety of raw material and intermediaries are imported from China.

Though, so far, companies importing these are not significantly impacted, their

supply chain is drying up. So, they may feel an impact going forward if the

22

situation does not improve,” said Sudhir Shenoy, country president, CEO of

Dow Chemical International Pvt. Ltd.

Madan Sabnavis, chief economist at Care Ratings, said lower oil prices has been

a blessing for India. “However, upward pressure cannot be ruled out with some

cuts expected by Opec and other exporting countries.

*****

Markets recoup budget losses riding on oil relief

Indian shares surged on Tuesday after a sharp budget-day sell-off. Stocks rose

the most in more than four months, tracking gains in Asian markets, as crude

oil prices slumped to the lowest level in 13 months. Lower crude prices will

benefit a range of industries that use oil and its derivatives, including airlines,

consumer goods makers, vehicle manufacturers, paint companies, and

refineries. A lower oil import bill will also help create more fiscal space for the

government to stimulate the economy. BSE’s benchmark Sensex surged 917.07

points, or 2.3%, to 40,789.38. This is the biggest gain since 23 September 2019.

The broader 50-share Nifty advanced 2.32% to 11,979.65 points. With this, both

the indexes have recouped losses incurred on the day finance minister Nirmala

23

Sitharaman presented the Union budget. Asian markets gained, supporting

Indian stocks. Shares in Japan, China, Hong Kong and Korea advanced as much

as 2% after Monday’s record $720 billion wipeout in China because of fears

related to the deadly coronavirus outbreak. Investors are weighing China travel

restrictions and business shutdowns alongside measures Beijing is introducing

to support growth as the hit to its economy mounts. Meanwhile, Hong Kong

reported a death from the coronavirus, confirming the second fatality outside

mainland China. On Tuesday, crude prices hovered around $54 per barrel.

Prices have fallen 20% in the past month, indicating oil could have slipped into

bear market territory. Brent prices are down 17% this year.

“In best-case scenario, we see a slight reduction in global GDP in first half of

2020 from our previous outlook. In the worst case, we expect a recession. In

the best-case scenario, global GDP sees reductions of 0.2% in Q1 and 0.15% in

Q2, and China’s by 0.8% and 0.2%, respectively,” said Claudio Galimberti, head

of demand, refining and agriculture analytics at S&P Global Platts.

In India, which imports more than 80% of its oil needs, low prices may give the

government more room to announce reforms and manage the tight fiscal

situation, analysts said.

“Lower crude prices are a big positive for Indian markets while gains in other

global markets boosted sentiment,” said Atul Bhole, vice president of

investments, DSP Mutual Fund.

“After the sharp sell-off on budget, there is a realisation among investors that

there was nothing negative in the proposals.”

As the government’s budget proposals didn’t bring in any material policy

changes that significantly altered growth outlook, liquidity continued to chase

Indian equities. On Monday, foreign institutional investors bought Indian

shares worth $258.53 million. They are net buyers of shares worth $1.37 billion

this year. Domestic institutional investors, including mutual funds and

insurance companies, have bought a total of ₹3,572.82 crores in stocks in 2020.

They bought ₹1,286.63 crores on Monday.

24

“We ascribe the fall of 3% in Nifty on 1 February to high expectations of a

growth-and investor-friendly budget and weakness in global markets. Our

expectation of a slow recovery in growth, supported by ample liquidity and

lower cost of fund remains,” Nomura said. The brokerage, however, thinks the

budget announcements on personal income tax and dividend distribution tax

could hit flows, persistency and value of new business margins for insurance

firms.

With Indian equities trading at almost 19 times forward price-to-earnings, a

40% premium to MSCI Asia Pacific excluding Japan index, there is near-term

downside risk to the markets, particularly in the light of rising coronavirus

concerns, according to Goldman Sachs.

*****

How Does Wind Energy Work

In the U.S. 8% of our energy generating capacity comes from wind turbines—that’s more than any other renewable resource—and wind power has more than tripled over the past decade. More than half of that capacity comes from just five states: Texas, Iowa, Oklahoma, California, and Kansas. According to the American Wind Energy Association, there are over 56,000 wind turbines across the country that provide a capacity of ~96,000 megawatts, enough to power more than 15 million homes. The Department of Energy projects that by 2050, that wind capacity will increase to more than 400 gigawatts. How can you get in on this growing wind energy action? Many electric utilities allow you to tap into wind—and other renewable—sources of power if you pay

25

a little bit more for a “green” option. More consumers signing up for green energy means those utilities will work to procure more of it. Let’s take a look at how wind turbines work and some of the potential pros and cons. HOW DO WIND TURBINES WORK? Wind power actually starts with the Sun. In order for the wind to blow, the Sun first heats up a section of land along with the air above it. That hot air rises since a given volume of hot air is lighter than the same volume of cold air. Cooler air then rushes in to fill the void left by that hot air and voila: a gust of wind. The Office of Energy Efficiency and Renewable Energy describes a wind turbine as “the opposite of a fan.” Simply stated, the turbine takes the energy in that wind and converts it into electricity. So how does it do that? First, the wind applies pressure on the long slender blades, usually 2 or 3 of them, causing them to spin, much like the wind pushes a sailboat along its path through the water. The spinning blades then cause the rotor, or the conical cap on the turbine, and an internal shaft to spin as well at somewhere around 30 – 60 revolutions per minute. The ultimate goal is to spin an assembly of magnets in a generator which will, well, generate voltage in a coil of wire thanks to electromagnetic induction. Generators require faster revolutions, however, so a gear box typically connects this lower speed shaft to a higher speed shaft by increasing the spin rate to around 1000 to 1800 revolutions per minute. These gear boxes are costly as well as heavy, so engineers are looking to design more “direct-drive” generators that can work at the lower speeds.

*****

26

More funds allotted to fight climate crisis

With the implementation of the Paris Agreement commitments beginning on

January 1, 2021, India has increased the budgetary outlays for climate-

mitigation action across sectors. During her budget speech in Parliament on

Saturday, Union finance minister Nirmala Sitharaman said that the country’s

commitments will be executed in various sectors “by the

departments/ministries concerned through the normal budgeting process”.

She added that Coalition for Disaster Resilient Infrastructure (CDRI), launched

by the Prime Minister Narendra Modi last year, will aid climate change

adaptation through disaster resilient infrastructure.

“India submitted its Nationally Determined Contribution, under the Paris

Agreement in 2015 on a ‘best effort’ basis, keeping in mind the development

imperative of the country. Its implementation effectively begins on January 1,

2021,” Sitharaman said.

Environment experts said it was good to see the climate crisis feature

prominently in the Union budget.

“The budget re-emphasises the importance India gives to tackling climate

change and its associated impacts. Tackling the issue of air pollution is of

utmost importance and it’s heartening to see that being recognised in the

budget. The renewables industry has also got a big impetus. Utilisation of this

allocation will, however, have to be done smartly,” said Karan Mangotra,

associate director, The Energy and Resources Institute (Teri).

27

The budget also proposed to provide about Rs 22,000 crore to the power and

renewable energy sector in 2020-21, which will contribute to mitigation of

greenhouse gas emissions. Last year, the budget allocation for the ministry of

new and renewable energy was Rs 3,891.74 crore (RE) which has been

increased to Rs 5,753 crore this time.

Sitharaman said the KUSUM (Kisan Urja Suraksha Evam Utthaan Mahaabhiyan)

scheme will be extended to provide 2 million farmers with stand-alone solar

pumps. “A scheme to enable farmers to set up solar power generation capacity

on their fallow lands and to sell it to the grid would be operationalised,” she

said, adding that the large solar power projects along railway tracks is also in

the pipeline. But some experts said that there was not enough allocation for

the adaptation to the impacts of the climate crisis. “Under the agriculture

outlays, Budget 2020 has made an attempt to provide a concerted policy push

to create and strengthen the nexus between agriculture, water and energy.

These are fundamental elements to enhance resilience at the local level. But

the how part — the institutional and incentive structures that drive the

implementation — is missing. The budget missed out the replenishment of the

much-needed National Adaptation Fund for Climate Change (NAFCC). For two

consecutive years, this has been ignored,” said Nambi Appadurai, director,

Climate Resilience Practice at World Resources Institute, India. India has made

eight broad commitments under the Paris Agreement --to put forward a

healthy and sustainable way of living based on traditions; to adopt a climate-

friendly and a cleaner path than the one followed by others at a corresponding

level of economic development; to reduce the emissions intensity of its GDP by

33-35% by 2030 from 2005 levels; to achieve about 40% cumulative electric

power installed capacity from non-fossil fuel energy resources by 2030; to

create an additional carbon sink of 2.5 to 3 billion tonnes of CO2 equivalent

through additional forest and tree cover by 2030; to better adapt to climate

change by enhancing investments in development programmes in sectors

vulnerable to climate change; to mobilise domestic and new and additional

funds from developed countries to implement mitigation strategies; and, to

promote climate-friendly technologies.

28

“It’s very good that the government has officially announced the

implementation of Paris Agreement commitments in the budget speech. This

sends out a message to government officials and ministries about our

seriousness towards this global commitment. I wish there was quantifiable

targets for adaptation too. It requires significant funding,” said NH

Ravindranath, climate scientist at India Institute of Science. India is the fifth

most vulnerable country globally to climate crisis, according to Global Climate

Risk Index 2020 by Germanwatch. India recorded the highest deaths due to

climate crisis-led disasters and the second highest amount of monetary losses

in 2018, said the analysis.

*****

Proposed duty on Chinese solar imports worries firms in SEZs

Solar companies that have manufacturing units in special economic zones (SEZs)

have expressed concern over the proposal to levy basic custom duty (BCD) on

Chinese solar imports, saying the charge will give an unfair advantage to those

outside the SEZs. According to the current proposal by the ministry of new and

renewable energy, the value addition done by units in SEZs will be charged BCD.

Units not in SEZs will not face such a charge. Industry executives said 63% of

solar cell and 43% of solar module manufacturing capacity are located in SEZs.

SEZ units were allowed a one-time exemption on import duty on capital goods

required to manufacture solar gear. They also enjoyed a rebate on the duty

levied on electricity that was consumed for the operation of their manufacturing

units which will not be affected by the BCD. The electricity duty rebate works

29

out to be Rs 17 per kilowatt peak (kWp). One solar panel with a with a peak

power of 1kWp functioning at its maximum capacity will produce 1kWh. Saibaba

Vutukuri, CEO of Vikram Solar, estimates that 300,000 to 400,000 jobs will be

created over the coming years as companies start manufacturing in India.

However, the present solar market still depends heavily on China. “33 GW

capacity of solar power deployment so far has been largely attained using

imported cells and panels from China, despite India having had enough module

manufacturing capacity," he said. Companies are requesting either a partial or

complete exemption to the duty. "This would also give manufacturers time to

set up capacity outside the SEZs and also help the sector to prepare," Pinaki

Bhattacharyya, CEO of Amp Energy India, told ET. SL Agarwal, MD of Webel Solar,

said, "This measure would be counter-productive and harm the very industry for

whose protection the measure is intended to be imposed."

On Thursday, power and new & renewable energy minister RK Singh told

reporters that the government plans to levy 15-20% duty that would rise to 40%

in a year's time, to reduce dependence on China. About 80% of solar imports

come from China.

*****

Coronavirus scare: Solar sector faces the heat

Indian companies supplying solar panels are reeling under the impact of

coronavirus, as a result of which projects are getting delayed. Makers of

equipment ranging from photovoltaic (PV) panels, raw materials such as steel

to other accessories, told BusinessLine that they are facing delayed shipments

30

post shut-down of manufacturing units in China and an increase in prices of

solar equipment. Ingrid Renewables, a solar inverter company, was expecting

fulfilment of several orders by a Chinese supplier based in Hubei province.

“Since the outbreak in January, shipments are stuck indefinitely,” he said.

Alternative manufacturers- Sesha Prasanna, MD of Bengaluru-based Espee

Solar, said his company, which had placed an order for solar panels, faced

delays in shipments in addition to a new complexity. “When I tried to source it

from alternative manufacturers located in Malaysia and Vietnam, the cost went

up by 30 per cent,” he said.

While prices going up is a function of market supply and demand, if this trend

persists for a quarter or so, it will have a bearing on India’s renewables dream.

To put it in context, the government has outlined a renewable energy target of

175 GW by 2022.

“The cost will be bundled in at the time of delivery and the end-consumer such

as a household or a corporate will have to pay for that,” said another PV maker.

In dire straits- Unlike other manufactured items such as smartphones, PV

panels cannot be bought off-the-shelf. If a manufacturer places a request in

January, it will be delivered by July. In the same way, an order request made in

July 2019 should have been finished in January, which is where a section of the

Indian companies is facing problems. “A distributor plans the order in advance

and because of this the sector is in dire straits,” said Yogesh Mundhra, a solar

sector expert.

Panels, inverters, mounting structures, wires, nut and bolts... all constitute 90

per cent of solar gear imports mainly from China, Malaysia, and Taiwan. In

China, the main sourcing point is Wuhan, where the coronavirus originated.

Labour movement has also been impacted as many places are under lockdown.

*****

31

Solar energy will play major role in achieving Atmanirbhar

Bharat, says Modi

Prime Minister Narendra Modi on Friday said solar energy would play a major

role in achieving self-reliance in energy, essential for an Atmanirbhar Bharat

(self-reliant India). While inaugurating the 750-MW solar power project in Rewa

district via video conferencing, Mr. Modi said, “We won’t be able to use solar

power entirely unless we have within the country improved solar panels,

improved batteries and best quality storage. We need to work in this direction

now.”

Stating that solar energy would be a big medium for the energy needs in the 21st

century, he added, “This is because solar energy is sure, pure and secure. Sure,

because other sources of energy can be exhausted, but the sun will continue to

shine. Pure, because instead of polluting the environment, it helps in protecting

it. And secure because, it’s a huge symbol, inspiration for Atma Nirbhar Bharat.”

Rewa Ultra Mega Solar project is an ambitious display of the finest in the sector

of #RenewableEnergy. Take a glimpse of how & what #RewaSolar is contributing

to the future of a greener and sustainable Madhya Pradesh. The Rewa solar

project, being touted as Asia’s largest solar project, is the first solar project in

the country to break the grid parity barrier. While the Delhi Metro will use 24%

of the electricity produced from it, Madhya Pradesh will use the rest. “The

project, along with others, will make Madhya Pradesh a hub of cheap and clean

energy,” said Mr. Modi.

32

While the world was in a quandary whether they should focus on environment

or economy, Mr. Modi said India had shown these two were not in opposition

to each other. “They are partners. For us, environmental protection is not

limited to some projects, but it’s a way of life. When we launch big renewable

energy projects, we are also ensuring our resolve towards clean energy is seen

in every aspect of life.”

Mr. Modi further said the government’s priority was that electricity reached

everyone and the environment remained pure. “This is reflected in our policies

relating to solar energy. In 2014, the price of solar power was ₹7-8 per unit.

Today, it is ₹2.15-2.30 per unit. Not just in the country, all over the world it’s

being talked about how solar power is so cheap in India.”

In order to achieve self-reliance, he said, the country aimed at ending its dependence on imports. “We have decided that government organisations which buy solar cells and modules should buy only the ones made in India,” he said.

*****

The sun, the wind and the Chinese dragon

For about a decade, the prices at which renewable energy companies sold

electricity to the utilities have been falling consistently. The factor behind this

was China. Now, the tariffs are set to rise and, ironically, the factor again is China.

All along, cheap solar modules and wind turbine components (mainly castings)

imported from China helped India roll out a respectable quantum of renewable

energy capacity. But now, from the signals emanating from the government,

33

India is determined to pare imports from China. If the upshot is a rise in wind

and solar tariffs, so be it.

The government has indicated a basic customs duty of 25 per cent on imported

modules and cells, likely to be raised to 40 per cent next year — levels that the

Indian solar manufacturing industry is not satisfied with. The industry expects

tariffs to go up to between ₹3.25 and ₹3.50 a kWhr for both wind and solar, rising

sharply from ₹2.36-₹2.38 a kWhr, seen in the latest solar capacity auctions

(2,000 MW, SECI, ISTS-IX). Wind tariffs are also expected to be allowed to rise to

similar levels. Few people grudge this rise. The country seems to be in line with

the thinking expressed by diplomat Gautam Bambawale, former Indian

ambassador to China, that India should absorb the pain of de-coupling from

China as it is in its long-term interests. Thus, it is clear renewable energy (RE)

prices will rise. This has several implications. The various electricity distribution

companies (discoms), most of whom are already in the red and owe power

suppliers ₹1.23 lakh crore, are those who will feel the pinch of the tariff rise. It is

not as yet clear as to how the Central government would help them defray the

higher costs of their power purchases, though, even after the expected tariff

hike, the prices of wind and solar energy will be substantially below the ‘average

power purchase cost’ of the discoms. The ₹90,000-crore liquidity infusion

promised as part of the Atmanirbhar scheme is moving slow, because of strings

attached to it. According to Emkay Research, as of June 30, five States (Tamil

Nadu, Andhra Pradesh, Maharashtra, Rajasthan and Punjab) had sought relief

under the scheme of ₹33,100 crores but only ₹12,300 crores has been

sanctioned (to four States other than Tamil Nadu.) “Even after the

disbursements of these sanctioned amounts is paid to the electricity generating

companies, the total outstanding dues of the discoms would be ₹1.1 lakh crore,

which is worrying,” says a recent research paper of Emkay. As such, the increase

in solar and wind tariffs is not going to be liked by the discoms, which may have

no option but to petition for hiking the electricity prices they charge their

customers.

Protection from competition

If this is the negative fallout of the rise in RE tariffs, there is better news on the

flip side. The mood among the solar module and cell manufacturers (such as

34

Adani Solar, Waaree and Tata Power Solar) and wind turbine companies (Suzlon

and Siemens Gamesa) is palpably upbeat. Sensing the mood of the government,

solar manufacturers have come up with a long wish-list: protection in the form

of high import duty for at least 10 years, capital subsidy for building new plants,

loans at concessional interest rate, money for upgrading technology and waiver

of duty on products sold in India from their units in Special Economic Zones.

But whether or not the government accedes to grant them this largesse, it is

clear that protection from competition from abroad is coming in the form of a

basic customs duty which, by itself, is sufficient to create business for Indian

module and cell manufacturers. A look at the Commerce Ministry’s import data

shows that when the rate of ‘safeguard duty’ was 25 per cent, India bought less

from China, but when the rate was reduced to 20 per cent and later, 15 per cent,

India bought more. Thus, if the government brings in even 25 per cent basic

customs duty on modules and cells (cells are assembled into modules), there is

likely to be enough business for Indian manufacturers. Industry insiders say that

unless the tariff is higher (40-50 per cent), there is bound to be the nagging fear

that Chinese products will still come in when their prices fall further — they are

17-18 US cents a Watt-peak today and are expected to decline by 12-15 per cent

due to the glut in China.

Unless the market is assured, domestic manufacturers show reluctance in

investing in R&D, critical for the industry. Regardless, the proposed 25 per cent

(from zero today) is a big positive. There is one issue, though. For the solar

projects already awarded under auctions, the government is thinking of allowing

‘pass through’ of the impact of the customs duty on imported products — which

means that the domestic manufacturers would have little business from the

awarded projects. Regardless, with the assurance of the market and other

sweeteners in the form of orders from government entities (public sector

companies, railways, etc.), the unfolding scenario for the Indian solar

manufacturers is much better. Likewise, the smile is back on the face of the wind

turbine manufacturers. Any tariff hike (in the Atmanirbhar or self-reliance spirit,)

will improve their margins. Margins have come down from around ₹1 crore a

MW in 2016 to ₹25 lakh, now — which, on a sale price of ₹5 crores a MW, is just

5 per cent. Capacity auctions are expected to pick up in the second half of the

35

year, a refreshing zephyr, particularly for Suzlon, which desperately needs

volumes to cover its costs, and Inox Wind, which is today sick. In both wind and

solar products, India has potential to export big. Exports of both are buoyant,

even if small. Wind components worth $500 million were exported in 2018-19;

even bulky, low-value products such as steel towers are being exported from

places like Tiruchi, Tamil Nadu, and Halol, Gujarat, to the US. Similarly, solar

exports are also on the rise, though still in small numbers. In 2019-20, India

exported modules and cells worth ₹1,506 crores, almost twice as much as in the

previous year. The next few years will reveal how the Indian industry is able to

blossom in a helpful policy environment. History shows that an indignant India

does well and if a robust manufacturing base develops as is hoped, the country

will have much to thank China for.

*****

In a world-first, India’s dozen major ports now run fully on

renewable energy

The dozen state-owned major ports in the country have switched to renewable

energy to meet their entire power requirements, making India the first nation

to have all government-owned ports running on solar and wind energy. Under

a ‘green port’ initiative, the Shipping Ministry had directed all the major ports

to install grid-connected and roof-top solar and wind power projects to

facilitate day-to-day operations including supplying shore-power to visiting

ships in an eco-friendly manner. The 12 state-owned ports are Deendayal Port

Trust, Mumbai Port Trust, Jawaharlal Nehru Port Trust, New Mangalore Port

36

Trust, Mormugao Port Trust, Cochin Port Trust, Chennai Port Trust, VO

Chidambaranar Port Trust, Visakhapatnam Port Trust, Paradip Port Trust,

Kolkata Port Trust and Kamarajar Port Ltd.

Shore-power savings

Shore-power, also known as cold ironing or alternative maritime power,

enables ships at dock or in dry dock to use shore-side electricity to power on-

board electrical systems, such as lighting, ventilation, communication, cargo

pumps and other critical equipment, while turning off their auxiliary engines.

The electricity comes from the local power grid through a substation at the port

and is plugged into special power connectors in the shore-power system on the

ship. Shore-power is considered an important way to cut emissions and save

costs for shipping companies. It is also a quicker and cheaper short-term

solution for allowing shipping companies to meet emissions targets –

particularly those related to emission control areas.

Emissions from ships at berth is estimated to be approximately 10 times greater

than those from the ports' own operations. “So, there is a greater potential to

reduce greenhouse gas emissions from ships in ports than from port activities

on the land-side,” a Ministry official said.

Ships when berthed at port, though not propelling, still consume a large

amount of energy to meet various functions during their port stay. This could

be for running the ships' auxiliary power for ventilation of accommodation,

loading and unloading of cargo, provisions and spares, cooking, etc. Running

these on fuel-powered generators results in noise, vibrations and emissions in

the ports. The supply of shore-side electricity to ships (all types of vessels) at

ports can reduce emissions, noise and vibrations, and is therefore considered

environment friendly. The government has enabled the major ports to develop

the necessary infrastructure to supply shore electric power to all types of ships

during the period of their port stay.

Lowering costs

Using renewable energy also helps ports cut power bills - a key operating cost -

which in turn translates into lower vessel- and cargo-related charges. India’s

37

maritime administration has framed standard operating procedures (SOP) for

shore electric power supply to ships in Indian ports that presently cover only a

low power supply – up to 150 kW at low voltage.

“Once a port is ready with high voltage supply to meet any power demand of a

ship, a new SOP will be issued,” a Ministry official said.

*****