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Backing Down Wind Mills in Tamil Nadu – There are two sides to every coin


Read an interesting article in The Economic Times today how there is a tussle between wind power generators and private conventional power generators, with TANGEDCO and MNRE being the other actors in the drama.

The script goes like this: MNRE would like wind generation to have “must run” status, meaning they should be backed down as little as possible.

At the same time, during many points in time, supply exceeds demand for TANGEDCO, which means they either back down either wind generation or conventional power generation, or risk losing money (as they need to pay the generators while TANGEDCO gets nothing for the power supplied over and above demand).

TANGEDCO earlier used to back down wind farms when such situations occurred. It appears they are now backing down conventional power from private parties. And these guys are naturally not happy as they too have signed power purchase agreements with TANGEDCO.

Who is right?

Should green power be given priority over conventional power, as green power generators have also signed PPAs, their power is more “green”, and wind power purchase costs (Rs 3.51/kWh in TN) will be likely lower than rates from private parties?

If you are from the wind industry, you would say: Of course, yes, it is a no-brainer, isn’t it?

But if you are from the conventional power sector, you will have your points too: Wind power is erratic even during peak season, so this needs to be factored in any backing-down decision. Two, conventional power generating companies also stand to lose owing to the constant back-downs – I guess frequent starting and stopping have its own “cost”, even if the fuel is not wasted, unlike in the case of wind power where the wind blows whether you are using the wind turbine or now.

The conventional power generating firms are not exactly keeping quite; they are taking legal recourse as well.

Even though I belong to the renewable energy sector, I am against giving blanket gifts to the wind power sector. It is not as if all the wind mill owners put these up for their love of environment – hardly so. Most of them put these up for accelerated depreciation benefits, and most of them would have recovered their money by now, which means whatever they are getting is a bonus – unlike for the conventional power sector, for whom there is a significant variable cost in the form of coal of natural gas.

What do you think?

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Narasimhan Santhanam

Thank you for reading this post – hope it was helpful. You can connect with me at narsi@solarmango.com . My detailed profile here and my LinkedIn profile here

Posted in: Chennai, Coal, Electricity Generation and Transmission, Gas, Onshore Wind, Policies and Regulations, Wind Energy

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