State beats Tamil Nadu to rise to numero uno position in the country; likely to become net exporter of electricity by 2028.
BENGALURU: Karnataka beat Tamil Nadu to emerge as the largest producer of renewable energy in the country, even as its coal import bill swelled by `2,006 crore in the last financial year. The state had a total of 12.3 Gigawatts (GW) of renewable capacity installed as of March, of which 5 GW was added in 2017/18 alone, according to a report by Institute for Energy Economics and Financial Analysis (IEEFA).
The report noted that due to its push towards renewable energy sources, “Karnataka is set to move from being a net importer of electricity to having a net balance, and it could become a net exporter” by 2028. Renewable energy sources such as solar and wind energy now account for 27 per cent of the total power generated in the state. In contrast, coal powered thermal plants generate 49 per cent of the total power. Nuclear and hydro-electric plants contribute 12 per cent each to the total power generation, the report titled ‘Karnataka’s Electricity Sector Transformation’ stated.
Due to its reliance on coal-powered plants, Karnataka’s coal bills increased by an astonishing `2,006 crore to `9,500 crore in 2017-18. The increase was driven by rising costs for imported sea-borne coal – which doubled between 2016 and 2018. While coal import cost from other nations increased by `1,364 crore during the past year, interstate supply price rose by `645 crore.
While coal costs swelled, cost of renewables have decreased. The report notes that recent solar tenders in Karnataka – such as the one for Pavagada Solar Park – have seen near record low bids of “`2.82-3.06 per kilowatt-hour (kWh),which was less than the average `3-5/kWh for domestic thermal power tariffs and the `5-6/kWh tariffs required for imported coal fired power”. Further reduction in renewable energy costs was achieved by introducing reverse auctions for wind-powered electricity due to which tariffs fell by close to 50 per cent from `3.45/kWh to `2.43/kWh.
The study by Tim Buckley, IEEFA’s director of energy finance studies, Australasia, and Kashish Shah, an IEEFA research associate, has projected that renewable energy sources will account for 23 GW of power generated in 2028, up from 12.3 GW currently.Karnataka’s ability to become an electricity exporter by 2028 is a “possibility currently constrained by insufficient interstate grid capacity” the report noted. Praising Karnataka for its ‘prudent energy policies’, it said that fully subsidised open-access model for solar power has ensured cheaper and reliable power supplies.
M G Prabhakar, advisory committee member, Karnataka Electricity Regulatory Commission, said the state had envisioned to increase renewable energy production over a decade ago. “Due to the same, we are moving towards becoming an energy surplus state,” he said. The state was also considering decommissioning some thermal plants as environmental costs of the coal powered plants are high, he added.