Sugar mills in the five major sugarcane growing states of India
currently produce 2,000 megawatts (MW) of power through cogeneration,
and could produce as much as 5,000 MW, according to a new study by New
Delhi-based NGO Centre for Science and Environment.
However, India has no policy framework in place to strengthen
this green energy source, the study said. Sunita Narain, director, CSE,
points out: "This energy source is an important win-win solution, as it
brings value-addition and additional funds to agricultural resources,
which in turn will give better payments to farmers and improve
productivity. The question is what can be done to increase this energy
source for the future."
The process of cogeneration essentially implies the production of two forms of energy, electricity and heat.
Today, out of the 650-odd sugar mills in India, 107 have
cogeneration plants. Cogeneration has managed to bail out sugar mills
reeling from the falling prices of sugar, the report said. The Dhampur
Sugar Mills in Uttar Pradesh, which has the largest cogeneration
capacity in the country, made Rs 42 crore from its cogeneration unit in
2007-08, compared to Rs 11 crore from its sugar units. It sold about
177 million units of power to the state. The third largest sugar maker
in India, Triveni, based in Deoband, Uttar Pradesh, is selling 16-17 MW
of power to the state.
The International Energy Agency says that the sugar sector has a
potential to produce 5,100 mw of power through cogeneration, which is
69% of the total cogeneration capacity. If the resources and technology
are improved, cogeneration can produce almost 10,000 MW or 40% of the
country's 2008 power deficit, the report said.
How it works and what it offers
Bagasse, a residue of crushed sugarcane, is burnt in a boiler to
superheat water and produce high pressure steam. The steam is sent to a
turbo generator, where it rotates the generator blades producing
electric current.
The report points out that bagasse generates nearly the same amount of
power as the wind energy sector. Wind produces almost 2,000 MW in
India.
Bagasse-based cogeneration plants also earn carbon credits as
the carbon dioxide absorbed by sugarcane plants while growing up is
more than the carbon dioxide produced in burning bagasse, the report
said. The cogeneration plant of Triveni earned about 186,000 certified
emission reductions worth over Rs 3 crore between March 2004 and
December 2007.
India had launched its biomass power (bagasse-based
cogeneration) policy in 1990. As the shortage of power grew in many
sugarcane states, the policy was revised in 2006 to provide capital
subsidy (Rs 15 lakh per mw) and tax rebates (including 80% depreciation
in the first year for selected equipment). The 2003 Amendment to the
Electricity Act also provided the necessary framework for promoting
renewable energy sources--asking states to fix a minimum limit for
energy utilities to buy green energy.
However, the country still has a long way to go. In the absence
of a strong policy framework, feed-in tariffs (the premium cost of
green power) differ from state to state and are based on scarcity (not
policy). While in some states like Tamil Nadu, the tariff is as high as
Rs 7 per unit, others like Uttar Pradesh pay only Rs 3 per unit. Low
feed-in tariffs have begun to hurt cogeneration, says the study.
Narain says: "The policy must incentivize the generation of
power, not capital investment." The capital cost of biomass energy is
roughly Rs 4-5 crore per mw, which is half the cost of installing wind
energy. But unlike wind, the raw material--bagasse or other
agricultural residues--has competing uses and value. Narain says this
price must be paid, as it helps local farmers to improve their returns
and encourages production of biomass.
Narain also recommends making the renewable purchase obligation
(RPO) mandatory, so that it becomes a tool to push for preferential
markets for green energy. "To do this", she points out, "the policy
must allow for inter-state sale so that green power-deficit states can
purchase from others. In addition, we should consider how biomass-based
energy can be used to feed local grids for local and decentralized
distribution. Local energy supply should be given preferential tariffs
so that villages that do not have power, get it."
In Related News...
India will submit plans within weeks to slow its rise in carbon
emissions significantly and to generate more solar power by 2020 than
the whole world generates now, a senior climate official said on
Thursday.
Read the full Reuters report at the link below.
