For the first time, the costs and benefits of retiring and reusing 4,020 MW of outdated coal units at Bhusawal, Chandrapur, Koradi, Khaparkheda, and Nashik have been quantified, according to research by Dr. Gireesh Shrimali, head of Transition Finance Research, Oxford Sustainable Finance Group at the University of Oxford, according to a press release from Climate Risk Horizons.
According to a new analysis commissioned by Climate Risk Horizons, repurposing some of Maharashtra's oldest and most expensive coal plants by using the land and some of the old coal infrastructure for clean energy and grid stability services can result in benefits worth ₹5,700 crore.
In accordance with India's Nationally Determined Contributions (NDCs) under the Paris Climate Accord, the report explains how the state can maximise financial gains from repurposing older units over the course of the next ten years while gradually decreasing its reliance on coal.
Dr Shrimali said, “The financial benefits of repurposing some or all of these coal plants would be between 2-4 times the costs of decommissioning, and would cover a substantial proportion of the new capital expenditure required for solar, batteries and synchronous condensers.".
He added that the estimated total cost of decommissioning for the units under consideration was Rs. 1,756 crore, while the study's findings indicated that the one-time savings from switching to solar PV with battery storage would be Rs. 4,356 crore.
He further stated that the analysis discovered that the benefits are even higher, at ₹5,700 crore, if the old power plant turbo generator is also converted to function as a synchronous condenser in addition to converting coal plants for solar PV and battery storage.
"Utilising the pre-existing land and grid connection facilities would significantly reduce the cost of the renewable energy generated. This would bring the cost to ₹1.87 and ₹2.69 per unit of electricity respectively for solar PV and PV with battery storage, providing Maharashtra State Power Generation Company (Mahagenco) with a cheap source of flexible power," said Shrimali.
Climate Risk Horizons CEO Ashish Fernandes said, "Maharashtra is already one of the leading states in India's energy transition story. This study shows that shutting down and repurposing the state's older, more expensive coal plants could provide a financially attractive opportunity to accelerate this transition in a way that benefits state finances."
Fernandes continued, saying that these outdated coal units are at or near the end of their useful lives and have high operating costs of up to ₹6/kWh. In order to meet emission standards, they also need to undergo pricey retrofitting with air pollution control equipment.
"Several studies have already shown that retiring old coal plants and replacing their planned generation with new, renewable energy can generate savings by way of lower electricity costs. This analysis looked at specifics of the plants in question in Maharashtra, and detailed decommissioning costs and financial benefits that would accrue from repurposing the existing land and electrical infrastructure for a combination of solar PV, battery storage and grid stabilisation services," said Fernandes.
The capacity of 1,224 MW of solar and 120 MW of 4-hour battery storage would result from repurposing the plants and the ash ponds connected to them for solar and battery storage.
Given the serious issues with air and water pollution brought on by coal plants in the state, according to Suresh Chopane, President of the Green Planet Society in Chandrapur (a hotspot for coal pollution), Maharashtra needs to lessen its reliance on costly and out-of-date coal plants. We must consider long-term solutions to stop the rise in electricity prices as well as to improve public health.
(With inputs from PTI)
