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A recent news report in Business Standard caught my attention – it mentioned that some renewable energy power plants in India produce power at costs of Rs 3-4 per kWh.

Coal power plants are still the cheapest usually, but not always. The report indicates that the cost of power generation from coal power plants is in the wide range of Rs 1.9-4.8/kWh. That’s indeed a w-i-i-i-i-de range! Wind power plants, by comparison have costs of about Rs 3.5 per kWh, acoording to the report (I would be more conservative and say wind power plants will have costs in the range Rs 3-4.5 per kWh, depending on the plant load factor, which could vary significantly from one location to another)

The constantly increasing price of coal is going to soon tip the scales in favour of renewables. The advantage coal does possess, and something most forms of renewable sources dont – is its ability to provide power on demand, the baseload power we all cannot live without anymore. Solar and wind cannot provide this reliability for the foreseeable future. Biomass comes closest when it comes to reliable, 24*7 power, but biomass is beset with supply chain problems.

Thus, we have the rather interesting set of points

1. Wind has almost achieved grid parity, but is not baseload compatible (solar will achieve grid parity in the next 5 years, but ditto on reliability)

2. Biomass can provide baseload power, but biomass is not free (most times) and its prices could increase unless a sustainable energy crop framework is brought in

3. Coal prices will continue increasing, perhaps forever, making coal terribly expensive over the next 4-5 years.

What do the above three observations leave us with? One possibility is the use of hybrid renewable power systems, especially for large scale power plants, where a combination of solar, wind and biomass are used such that the strengths of each of the three is utilized while the weaknesses are offset by the other two in the basket.

As wind is already close to grid parity, and biomass also can be considered to have grid parity if feedstock prices can be controlled (which, in the long run, is more feasible than controlling prices of a non-renewable resource such as coal), and solar is likely to achieve grid parity over the next few years, such hybrid power plants will overall have grid parity too.


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