Vanilla Solar vs Hybrid: India's Renewable Energy Future

India's renewable energy sector is experiencing rapid growth, with a total installed capacity of 88 GW as of August 2020, comprising 38 GW of wind energy and 35 GW of solar energy. The country aims to expand its renewable capacity to 175 GW by 2022 and 450 GW by 2030. As India accelerates this energy transition, exploring various technologies and business models beyond traditional, plain vanilla solar and wind contracts becomes essential to integrate increasing amounts of low-cost but intermittent renewable energy.

Vanilla Solar: The Current Landscape

Vanilla solar refers to standalone solar power projects, which have been a significant focus in India's renewable energy strategy. Solar power offers several benefits: it is scalable, has a declining cost curve, and can be deployed relatively quickly. However, the primary challenge with standalone solar is its intermittency, as it only generates electricity during daylight hours, necessitating complementary energy sources or storage solutions to meet demand consistently.

Wind-Solar Hybrid (WSH): A Viable Alternative

Wind-Solar Hybrid (WSH) systems, which combine both solar and wind energy generation, are emerging as a promising solution to address the intermittency issues associated with standalone renewable projects. These hybrid systems take advantage of the complementary nature of wind and solar resources: solar power is generated during the day, while wind power tends to peak at night and during different seasons, thereby providing a more balanced and stable power output.

The Indian government, recognizing the potential of WSH systems, introduced the National Wind-Solar Hybrid Policy in 2018. This policy incentivizes the development of WSH projects through waivers and fiscal benefits, aiming to promote efficient use of transmission infrastructure and land, and enhance grid stability. Several states, including Gujarat, Andhra Pradesh, and Rajasthan, have adopted their own WSH policies, further encouraging the adoption of these hybrid systems.

Benefits of Wind-Solar Hybrid Systems

1. Enhanced Grid Stability: By combining wind and solar, WSH systems reduce the variability of power generation, making it easier to maintain grid stability and reliability.
2. Better Utilization of Resources: Hybrid systems optimize the use of land and transmission infrastructure, which is especially important in densely populated regions with limited space.
3. Higher Capacity Utilization: The capacity utilization factor (CUF) of hybrid systems is significantly higher than that of standalone solar or wind projects, improving overall efficiency and output.

1. Cost-Competitive Tariffs: Recent tenders for WSH projects without storage have attracted competitive tariffs, comparable to standalone solar projects. For instance, the levelised tariff for a 250 MW WSH plant with an 80:20 solar-to-wind ratio is approximately Rs 2.49/kWh (US￠3.32/kWh).

Challenges and Future Outlook

Despite the advantages, WSH systems face several challenges:

• Land Constraints: High-potential wind sites with grid access are already saturated, making it difficult to install new capacity.
• Technical Integration: Integrating wind and solar systems, particularly on the direct current (DC) side, poses technical challenges that need to be addressed to fully realize cost benefits.
• Lack of Experience: There is limited experience in executing hybrid projects, and a shortage of skilled resources to manage these complex systems.

The integration of battery storage with WSH systems presents another challenge. While storage can significantly enhance the reliability and dispatchability of hybrid systems, the current cost of battery storage is high, resulting in increased tariffs. However, the cost of battery storage is expected to decline, making it a viable option in the near future. For instance, the EPC cost of battery storage is projected to fall by 15-20% by 2021.

Policy Recommendations

To further boost the adoption of WSH systems, the following measures are recommended:

• Coherent State Policies: States should align their policies with the National Wind-Solar Hybrid Policy 2018, providing clear incentives and waivers to developers.
• Flexible Co-Location Requirements: The criterion for co-location of wind and solar projects should be made optional to allow developers to choose optimal locations.
• Hybrid-Plus-Storage Tenders: The government should structure tenders to include battery storage, with realistic capacity utilization factor (CUF) requirements to avoid unnecessary oversizing.

Conclusion

Hybrid renewable energy systems represent the future of India's energy landscape. By leveraging the complementary nature of wind and solar resources, these systems can enhance efficiency, reduce variability, and optimize land use. The government’s supportive policies and continued technological advancements are crucial to overcoming existing challenges. As battery storage becomes more affordable, hybrid systems with storage will further stabilize the power supply, making renewable energy a more reliable and competitive option against traditional fossil fuels.

The transition to hybrid systems is not just a strategic move for meeting India’s renewable energy targets but also a necessary step towards ensuring sustainable and resilient energy infrastructure for the future.

[email protected]