Informs M Rajagopalan, Market Development Director, Middle East, Asia and Australia, Wartsila, in an interview with Monica Chaturvedi Charna.
Coal and gas-based hybrid solutions give right balancing, informs M Rajagopalan, Market Development Director, Middle East, Asia and Australia, Wartsila.
How do you see the potential of coal and gasbased hybrid solutions in India and what are the key challenges?
The potential is huge because it is based on the premise that the solution is available for dispatch all time round, and gas-based flexible generation gives that certainty. Coal and gas-based hybrid solutions give the right balancing which is needed with other generation sources like hydro, wind and solar.
Currently, international gas prices are low and the govt is planning to import nearly 60-70 mmscmd capacity to revive stalled projects. But this is not a consistent trend and India has not been able to generate the targeted capacity of gas. What needs to be done to make the sector more stable?
Given the fact that gas prices are uncertain and can fluctuate in future, I would suggest that we don’t use it for base load application or depend on combined cycle gas turbines. It won’t make sense because there is coal to provide base load power. Instead, we should use gas-based generation flexibly only when there is a need. While gas-based generation is expensive, it allows coal-based plants to run more efficiently, giving a cost advantage. For instance, instead of having a 100 MW coal-based plant running at 60% PLF, it would make sense to cut it down to 80 MW and run it at 80% PLF, producing the same number of units. The balance 20 MW can be topped through gas based generation. It is not fair to dismiss gas-based generation as being expensive primarily because it can achieve a very good balance when there are power outages. It will be at least better than diesel-based generation, where people are spending as much as Rs 25/ unit. We are trying to change the legacy system which states that coal is the cheapest and the best solution. Fortunately, the technical committee formed by the Ministry of Power to deal with renewable energy (RE) integration has also considered these points and has stated
that flexible generation and reserve capacity is a must. Wartsila’s solutions fit very well in both these categories. Optimising the energy mix in the right manner is the need of the hour.
The last 3-4 years saw gas prices shooting up because of which numerous projects were stalled. How did you cope with that scenario?
High gas price was surely a deterrent, specially for base load generation. Nearly 20,000 MW of gas based capacity was rendered stranded. This is the reason why Wartsila repositioned itself as we felt that the solar wind hybrid solution is perfect for peaking power and for RE balancing. Even the current government is very supportive of this solution and is drafting relevant policies for promoting solar wind hybrid systems.
How much capacity is Wartsila currently handling in the gas-based power generation business in India?
We currently have 110 MW on the order book, which is being executed. But, given the potential, we are hoping to do at least 250-300 MW in a year.
Which markets are the most promising?
India has a huge potential, especially in the RE space and the requisite policies are also in place. China is a very deceptive and large market with over 100 GW of just wind energy. We are looking for certain policies concerning our solutions for optimising wind generation there. If Saudi Arabia agrees to introduce the engine technology that we have, they stand to gain atleast $4-5 billion for a period of 10 years. We have a big market in Indonesia where gas-based solutions for peaking power and island application are significant. Middle East Asia and Australia are also fairly vibrant markets for Wartsila.