The power transmission system to evacuate electricity from 25,000 MW of solar and wind plants in western India will cost Rs 12,682 crore and will have annual tariff impact of Rs 2,156 crore in the first five years.
The infrastructure would be built for 8.9 giga-watt (GW) solar generation capacity in Rajasthan, 1.5 GW wind and 2 GW solar plants in Gujarat and 2 GW wind and 1 GW solar units in Maharashtra.
According to the calculations, the system would prepare the grid to handle electricity worth `9,318 crore per year, which is about 4.3 times the annual transmission cost. The estimates have been made by the Power Grid Corporation of India (PGCIL), the central transmission utility. On an annualised basis, charges are seen to be around `1,776 crore.
This comes at a time when the longstanding impediment of inadequate transmission infrastructure for renewable power developers has forced the government to reduce capacities offered in reverse auctions, along with delay and cancellation of under-subscribed tenders. The Solar Energy Corporation of India had projected that bidding for about 18 GW solar and 10 GW wind generation capacities were to be done by FY19-end.
The transmission schemes are implemented either through the tariff-based competitive bidding (TBCB) or under-regulated tariff mechanism by PGCIL. However, most of the projects are now being tendered through tariff bidding, increasing the scope of private players. FE was the first to report that private power transmission companies were apprehensive that PGCIL would quote “unreasonably low” prices in upcoming bids for renewable energy transmission projects, and sought the suo motu intervention of the CAG to prevent PGCIL from bidding aggressively.
About `2.7 lakh crore would be required till FY22 to build the additional electricity transmission system, the national electricity plan on transmission published by the Central Electricity Authority said. The money would be spent on the 1.1 lakh circuit km of transmission lines and 3.8 lakh mega volt amp of sub-stations required to support new generation capacities and make the infrastructure more flexible to accommodate the evolving trends in power consumption.
Government reports have also suggested that tariffs of coal-based electricity may be raised by as much as `0.45/unit, about 13% of the average all-India power price, to accommodate renewable energy in the system.