Green Financing A Boon For Clean Transmission Projects: Sharib Razi

Green Financing A Boon For Clean Transmission Projects: Sharib Razi

What are the challenges faced by the grid, when it comes to a higher share of renewable energy?

Razi: There are two major challenges with increasing share of renewables in the grid. Firstly, due to the intermittent nature of renewable energy, the peak generation of solar or wind does not coincide with the peak load profile. Secondly, inverter-based solar and wind plants do not provide the equivalent inertia as conventional turbine generators in terms of reactive power support.

Utility-scale renewable projects post final approvals, typically can be set up in less than a year. What are the timelines for a large-scale transmission project typically? How do renewable developers align their progress with transmission projects?

Razi: Schedule of the transmission line projects usually range from 6 months to over 2 years, depending upon the voltage levels and the length of the transmission line. Typically, a dedicated transmission line built to provide immediate connectivity to an RE project is shorter in length and gets executed within 6 to 9 months. However, grid interconnecting transmission lines such as dedicated renewable energy corridors are usually longer (could be up to 100s of kilometres) and thus can take up to 2 years to complete. As RE developer we closely interact with the TL project developer and schedule the RE project commissioning in tandem with the TL project commissioning.

3. What are the kinds of investments transmission projects require in India to keep up with the pace of renewable development?

Razi: Investments towards creating transmission projects dedicated to new energy are required to keep up with the pace of RE development. We have substantial RE generation capacity, however, it is not uniformly distributed across the country. The existing transmission infrastructure is not only saturated for evacuation of power generated by conventional sources, but also concentrated accordingly. Recently we are witnessing a lot of development on these RE centric transmission projects, specially in the western and southern parts of the country.

4. Tell us more about your portfolio in terms of focus on renewable project evacuation versus the rest. How do you see your future plans?

Razi: In terms of renewable energy evacuation infrastructure, a dedicated pooling sub station with a dedicated transmission line upto the nearest grid sub station is an integral part of our projects. However as of now we are not focussing on upstream transmission projects for RE evacuation.

5. Can you explain the concept of a green energy corridor to our reader? Especially in the context of agricultural power?

Razi: A green energy corridor is a transmission system which is exclusively used for the evacuation of renewable energy to the load centres. Its primary objective is to strengthen the transmission infrastructure for the renewable energy sources as the country transitions to a more sustainable green energy future. Considering that the load intensity of agricultural power is much lesser than the industrial load requirements, making dedicated green corridors for the agricultural land is not a viable option at this stage. However, to address the agricultural power requirements, the government has come up various initiatives like PM-KUSUM which includes installation of solar pumps and solarization of agricultural feeders to provide reliable and sustainable power to farmers. While these initiatives may not be termed specifically as “green energy corridors, they are part of broader efforts to integrate renewable energy into various sectors, including agriculture.

6. Would transmission firms benefit if key projects linked to renewable energy come under the ambit of green financing? Or is funding a non-issue?

Razi: If the transmission is linked to renewable energy, the transmission firm can avail of green financing which is usually cheaper than other financing available in the market. Green financing presents transmission firms with a host of advantages. Firstly, it offers cost savings through lower interest rates and more favorable terms compared to conventional financing options, easing the financial burden. Secondly, the attractive terms of green financing, including longer repayment periods and specific incentives for sustainable projects, make financing more manageable. Moreover, investing in renewable energy infrastructure through green financing helps mitigate regulatory risks associated with carbon emissions, thus ensuring long-term cost savings. Additionally, green financing opens up a new pool of capital specifically designated for sustainable projects, providing transmission firms with access to funds they might not obtain through traditional channels. Finally, aligning financial strategies with environmental objectives, green financing enables transmission firms to advance their sustainability goals while fulfilling their business objectives.

7. We have seen how transmission bottlenecks have been the biggest challenge in the developed markets when it comes to the faster addition of renewable capacity. How much of a challenge is that set to be in India?

Razi: Transmission bottlenecks are as much a challenge in India as elsewhere. The infrastructure that exists right now was devised to support conventional power and it is saturated accordingly. While development of Transmission lines has been delicensed recently in India, challenges related to space and population density continue to exist.

8. Massive renewable plans like those at the proposed 14 GW Ladakh solar park, or even the GIB (Great Indian Bustard) issue are linked to the economics of transmission costs. Can you explain how that works? Cost of underground versus overhead lines?

Razi: The delivered cost of RE to the end user incudes the transmission costs. Therefore it is imperative that the transmission costs be kept as economical as possible. We need Extra High Voltage level (400kV or 765kV) transmission system For a GW scale RE park. However evacuating power from the Ladakh area to the major load centres would call for a massive capex thereby impacting the cost of power evacuation. Also, with GIB issue the transmission system has to be laid using underground cables at EHV levels. While as solar developers we don’t have a practical experience in buying such cables, the cost of these cables can be as high as 12 times compared to overhead cables.

9. Globally, we have been tracking plans for transcontinental power networks, or even our own Prime Minister’s aspirational “One Sun One World One Grid” vision. Would it be fair to say that the success of these projects depends completely on transmission costs coming down? Be it for HVDC lines or more?

Razi: Yes, cost is a major factor, however technical feasibility would also play a role because the grid behaviour is very different in different countries. Having said that, it is a plan which should be taken up more earnestly.

10. What is the typical life of a transmission line, and maintenance requirements?

Razi: A typical EHV line has design life upwards of 50 years. Maintenance is mostly centered around visual inspection of the towers, conductors and insulators and attending to any defect observed. Usually this is carried out on a monthly basis.