As India readily embraces renewable energy, moving steadily on course to deliver on its commitment to have installed renewable energy base of 175 GW by 2022, there’s a question mark over what happens to the non-renewable power sources like coal. Yet, coal still accounts for over 50 percent of power generation in India. Hence, what could be the right approach or the right strategy between renewable and non-renewable sources of power? How can the current power plants be modernised to be more efficient and less polluting? These were some of the questions that Prashant Jain, Managing Director, GE Power India dwelt on in an exclusive interview with CNBC-TV18’s Shashwat DC.
Edited excerpts from the interview:
Over the past couple of years, there have been a lot of excitement and announcements in terms of renewable energy. Yet, coal remains our mainstay when it comes to power. How do you think the future will evolve?
As a country, India must decide the best energy mix to provide reliable, affordable and sustainable power to all. In deciding the optimal energy mix, a dilemma that we face is between either focusing on increasing gigawatts or the generation of billion units of electricity. Currently, the focus is on increasing the total gigawatts whereas the emphasis should be on increasing the generation of the number of units of electricity. In India, the current demand is for approximately 1,250 billion units of electricity out of which roughly about 1,000 billion units are coming from coal-based powered plants. Converting this numbers into gigawatts makes the ratios appear fairly different. However, when we look at the actual number of units of electricity needed, it can clearly be seen that to fulfil the overall demand for the number of units of electricity, coal is still the best load option.
Over the next 5 years, as per the Central Electricity Authority (CEA), nearly 1,500 billion units will be needed on the grid. When India achieves its target of 175 gigawatts of renewable electricity, it would amount to about 250-260 million units of additional electricity from renewables. This would still leave a shortfall of well over 1,000 billion units of actual units of electricity needed to be generated which will have to be sourced from fossil powered plants over the next 5 years.
My biggest passion is – how we can make the existing coal plants sustainable, how we can reduce the emissions, how we can improve the efficiency.
So, do you think coal will continue to be a mainstay of India's power mix going into the future?
For the energy security of our country, it is critical to find and achieve a good balance on the grid. As a company, globally we are invested in and have a large installed base in coal. However, it is highly recommended that the country strikes a good balance between a renewable portfolio comprising solar, wind, hydro and hybrids (with or without storage) combined with a good mix of steam and gas. COP 21 regulations have ensured that newer coal-powered plants need to deploy technologies like flue-gas desulphurisation (FGD) to make plants more environmentally friendly, efficient and less hazardous. As a next step, the sector and the government need to combine their efforts and focus their energies on making existing coal plants more efficient, sustainable, affordable and reliable.
Indeed, when we talk about FGD how does it actually clean up the coal it removes? I was reading, that it brings down sulphur dioxide levels by 97 percent. How does it impact the overall pollution that the plant is causing?
The deployment of FGD helps lower emission levels and remove about 97 percent of the Sulphur content and other harmful particles from the atmosphere. COP 21 norms have ensured that modern coal-powered plants use technologies and solutions to improve their efficiency levels. The failure to deploy FGD will result in an increasing number of health issues for the people living in the plant or in its vicinity. Also, the solid particulate emissions in the air will lower the level of fertility of fields around these plants which will affect the cultivation of crops thereby impacting the local economy. Therefore, by deploying FGD as a solution the challenges and harmful effects for people living in close proximity to these plants have been lessened to a large extent.
There have been a lot of talk about supercritical coal plants in India. How do you see the future prospect?
The level of supercritical technology being adopted by the country is fairly high especially on the pithead plants where having a supercritical plant increases levels of efficiency as the need for transportation is diminished greatly. Deployment of FGD technology on top of that, makes an already efficient plant, a best-in-class coal plant. Outside India, plants like these can deliver efficiency levels of approximately 48-49 percent. In India, depending on the year, new plants with capacities ranging between 3-7 GW are being added. However, we need to account for the fact that there already is an existing capacity of 200GW of coal-powered plants. Thus, the addition of these new and highly efficient plants to improve efficiency levels are just a drop in the ocean. The need of the hour is to engage in dialogue to develop a PPA model in order to find solutions to make these already existing plants more efficient.
While GE’s work in manufacturing is renowned, the company also has an impressive services portfolio. How are you looking at that aspect of business?
The GE manufacturing facility at Sanand factory has undertaken approximately 5 gigawatts of new build and 4 gigawatts worth of repairs. At Sanand, there are over 70 employees who have been trained in the use of state-of-the art technology which has been developed using in-house R&D. Robotics and other highly advanced technology solutions are also used to reverse engineer old technology thereby lowering the cost of parts for customers by approximately 15-30 percent.
Depending on the job, 10-15 percent of revenue for the Sanand facility is from services. Globally, the percentage changes to 50-50, because the number of new units being added overseas is significantly lower than the number being added in India. Therefore, the revenue generated from services is much higher. In India, the percentages are very different due to many more new units being added on a yearly basis.
You have an impressive setup at Sanand. Where does it fit into your map?
The manufacturing facility at Sanand is at the centre of the journey of efficiency, flexibility and the services business. A Centre of Excellence, the manufacturing facility is a one-stop shop for solutions in engineering, execution and is also part of the global supply chain servicing 40 percent of all GE Steam Power customers in India and overseas. This manufacturing facility also has capabilities of reverse engineering which proves instrumental in helping to lower costs for customers by 20-30 percent. The built-in flexibility in the design of the facility allows us to change and physically retrofit and service spots in-house saving a significant amount of time, ensuring best-in-class service resulting in customer delight.
How does the Make in India initiative tie into the work you are doing?
GE has invested $200 million in the setting up of the manufacturing facility at Sanand. This is testament to our commitment and belief in the Make-in-India initiative. It is our responsibility as an industry to showcase the benefits of investing in India. The combined efforts of industry and the government being made towards this have been showcased excellently by the government on the global stage in the recent past. Approximately 5 gigawatts of the projects that GE is executing today is due to the introduction of the local manufacturing initiative which allowed us to bid for these tenders and win the same.
GE has gone through its own set of challenges and there have been a lot of shifts happening, how do you see the business evolving given that there have been some silver lining and GE Power has been getting a lot of wins? How do you see the future panning out?
For Steam Power, we have discussed how the government has been giving a lot of emphasis to the renewable sector. Coal sector is the baseload sector and so provides that much needed balance to the energy mix. We are spending a lot of time to ensure that this balance is right for the country to ensure there are suppliers and there is talent in this sector. The right way to get this balance is to integrate renewables on the grid and at the same time make existing coal plants more sustainable. We are looking at a market of about 5-7 GW within next 3-5 years of new addition in capacity. There is no doubt that it’s going to be challenging but I am optimistic that we still have good years ahead.
(Travel for this interaction was arranged by GE Power).