Why India needs to develop concentrated solar thermal power plants

India's solar boom has exposed grid and storage challenges, making it essential to scale up concentrated solar thermal power alongside batteries and pump storage for reliable round-the-clock energy

India has achieved remarkable success in the development of solar power, adding over 35 Gigawatts (GW) of capacity last year. At less than half the price of new thermal power, solar power is cheap. The unintended consequences of this extraordinary success have been problems. There is a growing body of opinion which feels that we are going too fast and need to slow down renewable capacity creation. The systems cost of solar power is much higher than its low contracted price. Transmission constraints are becoming acute leading to curtailment of generation. Transmission costs have been rising at unacceptable rates.

 

Solar power is produced only when the sun shines. Its generation is variable and inflexible. The capacity utilisation of transmission lines created for large solar projects is necessarily low and real transmission costs are that much higher. Grid stability problems arise.  Thermal power plants cannot reduce generation beyond a point. There are periods when demand is less than solar generation and the lowest technically feasible thermal generation.

 

 

Curtailment of solar power generation which has zero marginal cost becomes necessary for grid stability. This has begun to take place. Transmission capacity beyond the state and the region becomes inadequate for these situations even though we have a robust all India grid. Large solar power projects have been coming up in states with favourable endowments such as Rajasthan, Gujarat and Karnataka.

 

The solution lies in the storage of electricity. During the day, when generation is more than demand, the extra generation can be stored. Further, more solar power can be generated and stored for supplying electricity at night. Assuming a flat demand curve and about 25 per cent loss of electricity in storage, the ideal ratio of solar power capacity creation to storage capacity should be1:1.25.

 

Recognising the imperative need for storage, bids are being invited for BESS (Battery Energy Storage Systems). The prices in response to these bids have been falling. Solar power with battery storage is now cheaper than new thermal power.  Batteries can be easily installed wherever needed. Electricity from solar power and battery storage systems can now provide cheaper electricity to meet additional demand than from a new thermal plant. This is a major inflection point for our energy transition.

 

Pump Storage Projects (PSPs) use electricity to pump water to a reservoir at a higher level, allow this water to fall and generate hydropower when electricity is needed. This water is kept in a lower reservoir. Surplus electricity is used to pump water up and this water is allowed to fall and generate electricity when needed.  PSPs can be developed on rivers as well as at off river sites where the natural terrain permits the creation of two man made reservoirs of water with a height difference. Commendable work has been done to identify sites. Investor friendly guidelines have been issued and clearances have been streamlined. Investor response has been positive, and development of PSPs is gathering momentum.

 

There is, however, one other mode of storage in CSPs (Concentrated Solar Projects). In this solar energy is stored as heat in molten salt by reflecting sunlight from an array of large mirrors to a single point. This stored heat is used to generate steam which runs a conventional thermal turbine to generate electricity when needed. This electricity generation is akin to thermal power. This technology is now mature and cost effective at 7 US cents a unit with the possibility of going down to 5 cents a unit.   CSPs can be built wherever large power projects with solar panels can be built. They both need solar radiation. Ideally, they should come up at the same location so that electricity is generated round the clock. The same transmission capacity is used in the day for solar power and at night for electricity from CSPs. Hence, we need to create CSP capacity of the same magnitude as large solar projects with bids being invited for supply of power from CSPs. As in the Solar Mission bids may be invited for small quantities to begin with and then be scaled up. Competition would drive innovation and cost reduction.

 

Solar power combined with storage is now cheaper than new thermal power. We therefore need not build any new thermal plants and give consumers cheaper electricity. But for this to happen storage capacity creation has to take place on a massive scale. We therefore need to simultaneously develop all modes of storage: BESS, PSPs, and CSPs. Launching the process of inviting bids for PSPs at the earliest and then scaling it up rapidly would be key to creating the storage capacities that are needed to provide cheaper and reliable electricity and to give up building new thermal plants.  

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(The author is Distinguished Fellow, Teri, and the author of Rising Ambition-Carving New Pathways-India's Energy Transition)

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