Renewable Energy Commercialization

• Markets Must Adjust Due to Security Concerns

• Alternative Investment Vehicles• Global Market Growth for Electricity• Global Warming• Fossil Fuel Price Volatility• Electricity Deregulation

Mission & Program Areas

To develop and implement solutions that balance the need for food, income and environmental quality

• Program areas– Energy and Environment– Natural Resources Management– Climate Change– Outreach

Status so far

• Initiatives of other agencies (NGO’s / Private sector not included)

Sources / Systems

Achievements during 2010-11 (upto 30.06.2010)

Cummulative Achievements (upto 30.06.2010)

Solar Power 2.00 MW 12.28 MW

Solar PV Power Plants

0.0 MWp 2.92 MWp

SPV Home Lighting System

nos. 6,03,307 nos.

Solar Lantern nos. 7,97,344 nos

SPV Street Lighting System

nos. 1,19,634 nos

SPV Pumps  nos. 7,334 nos.

Solar Water Heating - Collector Area

3.53 Mln. sq.m.

Commercialization of Renewable Energy

• Identification of RE enterprise opportunities

• Develop a replicable approach for assisting local entrepreneurs to promote RE services for productive applications

• Augment rural incomes through value added production and generate local employment

• Facilitating access to resources, stakeholders

• Communications and outreach

The Way Ahead…

• Understand the beneficiaries needs– Not all rural / remote families can afford SHS

• Link up with livelihood options to make it more affordable

• Need more public private partnerships• Special lending mechanisms to attract

beneficiaries• Ensure all supply chain components are in

place• Capacity building of local NGO’s and providing

technical backstopping for their programs

Recent Growth Has Resulted In Global Annual Renewable Energy

• Invention and Discovery• Major Technology Changes• Major Market Needs• Government Incentives – for All Energy Systems• Government Renewable Resource Assessments• Technology/Institution Linkages

Product Segmentation

SOLAR ELECTRIC

FUEL CELLS

SOLAR THERMALBATTERIESBATTERIES

SYSTEMS/COMPONENTS

SYSTEMS/COMPONENTS

BIOMASSMICRO-

TURBINES

CLEAN FUELS

Hydrogen

Photovoltaic Growth

0

20

40

60

80

100

120

1900 1925 1950 1975 1985 1995 2000

YEARS

EC

ON

OM

IC I

NT

EN

SIT

Y

AB C

D

Investment Criteria are Consistent with Silicon Valley

• Strong Management Team• Technology Based• Proprietary Product• Substantial Capital Appreciation• Limited Legal/Financial Downside• Venture Stage: Pre-commercialization to

Expansion

10

Synergies Between Climate Change Financing Mechanisms:

Options for Third word Countries

11

Objectives

• Identify potential synergies among climate change financial mechanisms– In support of clean energy, renewable energy and

energy efficiency

UntappedRenewable & EnergyEfficiency Potential

Renewable EnergyRenewable EnergyPotentialPotential Developed

Small Hydro (<25 MW)

75 MW 23 GW

Wind 160 GW 240+ MW

Biomass 125 GW ?? MW

Geothermal 6.7 GW 30MW

Solar Abundant

Source: CRESP & EIA

0

40,000

80,000

120,000

1980 1999

United StatesNetherlandsIndiaChina

BT

U/G

DP

(1

990

$U

S) Energy EfficiencyEnergy Efficiency

China

India

USA

Netherlands

7

13

Major Opportunities to Leverage Additional Resources

• Global Environment FacilityGlobal Environment Facility (GEF) - Climate Change Operational Programs– Lowers costs– Promotes commercialization & technology transfer

• Prototype Carbon Fund Prototype Carbon Fund (PCF)– Learn carbon trading by doing

Both of which can enhance the potential for …

• Leveraging additional climate change funding such as…– Clean Development Mechanism Clean Development Mechanism (CDM)

14

Global Environmental Facility

Four Climate Change Operational Programs:OP 5.OP 5.  Removal of Barriers to Energy Removal of Barriers to Energy EfficiencyEfficiency

and Energy and Energy ConservationConservation

OP 6. Promoting the Adoption of OP 6. Promoting the Adoption of Renewable Renewable EnergyEnergy by Removing Barriers and by Removing Barriers and Reducing Implementation CostsReducing Implementation Costs

OP 7. Reducing the Long-Term Costs of OP 7. Reducing the Long-Term Costs of Low Low Greenhouse Gas Greenhouse Gas Emitting Emitting Energy Energy Technologies Technologies

OP 11. Promoting Environmentally OP 11. Promoting Environmentally Sustainable Sustainable TransportTransport

15

Global Environmental FacilityWhat can it do?

• Remove policy barriers– Facilitate RE Mandated Market System– Promote sound energy prices

• Create business capacity/reduce transaction costs– Project feasibility studies– Technical skills

• Reduce cost of clean energy (renewables & clean coal) technologies– Transfer of technologies– Domestic production of equipment

16

Prototype Carbon Fund (PCF)What is it?

• Pilot fund to create a global market in carbon credits

• Principal objectives: – GHG emission reductions through project

based financing – Promote sustainable development consistent

with national priorities

17

Likely Early Stage Projects

• Methane capture projects– Fugitive gas capture from landfills, gas flaring

reduction, etc…

• Fuel switching and co-generation • Renewables

– Small Hydro & Hydro rehabilitation– Biomass– Landfill gas

• Fossil– Natural gas development – depending on baseline

• Energy efficiency & conservation

18

CDM ConstraintsHow Can GEF/PCF Help?

• Policy framework – Renewables Mandated Market Share (MMS) &

Appropriate energy pricing GEFGEF

• Clean technology costs – Project development/Tech transfer GEFGEF

• Capacity & high transaction costs– Learn carbon trading by doing PCFPCF

• Baselines and standards – Learn carbon market/CDM by doing PCFPCF

Forms of renewable energy

1.Wind power is renewable and produces no greenhouse gases during operation, such as carbon dioxide and methane.

2.Hydropower-energy in water can be harnessed and used. Since water is about 800 times denser than air, even a slow flowing stream of water, or moderate sea swell, can yield considerable amounts of energy.

3.Solar energy is the energy derived from the sun through the form of solar radiation.

4.Geothermal energy is energy obtained by tapping the heat of the earth itself, both from kilometers deep into the Earth's crust in some places of the globe or from some meters in geothermal heat pump in all the places of the planet .

Renewable technologies

1.Ocean thermal energy conversion uses the temperature difference that exists between deep and shallow waters to run a heat engine.

2.Osmotic power is the energy retrieved from the difference in the salt concentration between seawater and river water.

3.Microbial fuel cell is a bio-electromical system that drives a current by mimicking bacterial interactions found in nature- converting chemical energy to electrical energy by the catalytic reaction of microorganisms.

Renewable energy commercialization

o World's largest photovoltaic power plants

o Use of ethanol for transportation

o Geothermal energy prospectso Wave farms expansiono Developing country markets

Constraints and opportunities1.Availability and reliability- There is no shortage of

renewable energy - however, converting that energy to a usable form in acceptable ways and transporting it to consumers has so far limited the use of renewables.

2.Land area required-One environmental issue, particularly with biomass and biofuels, is the large amount of land required to harvest energy, which otherwise could be used for other purposes or left as undeveloped land

3.Hydroelectricity-Hydroelectric power can be far less expensive than electricity generated from fossil fuels or nuclear energy, and areas with abundant hydroelectric power attract industry.

4.Wind farms-Wind power is one of the most environmentally friendly sources of renewable energy. It generates the energy used in its construction in just 3 months of operation, yet its operational lifetime is 20–25 years.

RENEWABLE ENERGY

TECHNOLOGY & MARKET ISSUES, PRIVATE SECTOR PARTICIPATION

RENEWABLE ENERGY – Technology & Market Issues

The total energy from the sun incoming on the earth is around 174 peta watt which is many times more than the total power demand of all nations.The global market size according to data graph group Approx. potential wind 49 GW, small hydro 14GW, bio-mass 27 GW, solar at least 650 GW.Projected RE in 2050, 70%

Investment in green energy has quadrupled in 4 years. While during the last global financial crisis there has been hesitation and in US there is a slight drop, but there is increase in the growth of Renewable Energy in EU, China, BRIC, Chile, Peru, Philippines etc.

One thing is clear that Govt. is playing a key role and together with private investment the future is bright.Largest investment has been in wind power but the best growth has been in solar power.Coal price increase helped to bridge the gap

Success of Renewable Energy and its rapid uptake depends on concern for remaining fossil fuel reserve and connected issues of import dependence as also energy security, environmental protection and Govt. support and financial incentives.

The cost of solar panels have fallen rapidly,

sometimes > 40%. This is due to scale, process, new design, innovation, new materials

Private investment in the wind farms already planned around 4400 MW in wind, about 400 in solar. Attempts are also being made for installing a 5 MW Geo-thermal Plant in Gujarat.

Renewable Energy commercialization involves 3 generations of Renewable Energy : the first one including Biomass Hydel power and Geo-thermal power are already matured and competitive.

2nd generation technologies are market ready and being deployed at present such as Solar heating, Solar PV, Wind Power, Solar Thermal and modern forms of Bio-energy.

3rd generations technologies requires continuous R&D for such needs as Bio refinery, Hot dry rock Geo-thermal power and Ocean energy.

Barriers of policy and political leadership are to be removed. 98 countries have set up their own targets for their own

Renewable Energy future. Total investment in Renewable Energy about 211 BUSD in

2010, up from 160 BUSD in 2009. The top countries were China, Germany, US, Italy and Brazil.

Pakistan has abundant sun light, average 300 sunny days in a year.

Remote area, remote villages are important. Also day-light farming needs power.

We have abundance of sun shine, but ignorance about solar power. Germany which is cloudy many times has largest solar power installation because of smart governance.

ROI in desert base plants in barren lands will be much higher.

In many areas cases, solar energy cheaper than drawing cables or transmission lines from long distance.

Nobody believed in the future of laptop, flat screen TV or mobile which are now high selling items.

Past 3 years solar panel cost have dropped by half. Reasons are large scale production, method of production, new materials etc.

Some say by 2020 or even earlier, solar electric power will match the conventional power cost, helped by rising cost of coal

The main criterion will always be not the cost of equipment but the tariff for energy. New and efficient solar panels are being devised. Also, solar systems are very easily expandable.

• Scaling and integration are two major issues for Pakistani players.

• Pakistan is already seen as a low cost, high-tech hub for solar component mfr.

• According to one PSA study solar pv costs at present (about Rs.150/- per Wp) is far more attractive option for electrification for a village than extending the grid by around 12 km.

We need the proposed ultra mega power projects but Renewable Energy in another 5 years will compete head on with coal / oil fired units. The challenge will remain which will mean not compromising growth by investment in Renewable Energy, particularly wind, solar and bio-fuel.

Conclusion

I consider that renewable energy is being more and more used and in the future conventional energy will be replaced by it due to the fact that it is far more reliable does not produce residue and costs less to create and distribute.