Replacing its coal power contracts with renewable energy can save Kerala ₹9,000 crore over a five-year period, according to a study by think tank Climate Risk Horizons.
A report on the findings, released here on Friday, recommended that the State go in for a phased energy transition plan with the goal of phasing out coal power purchases by 2030 and making its grid coal-free.
By replacing its scheduled purchases of coal power from Central sector plants with new renewable energy at an average of ₹3 per unit, the State can save approximately ₹969 crore a year based on tariffs sought by the Kerala State Electricity Board (KSEB) for the 2022–2027 period.
Switching over to renewable energy by replacing all coal power contracts could ultimately save the State an estimated ₹1,843 crore annually or over ₹9,000 crore in five years, the study said.
The report was released by Additional Chief Secretary (Power) K.R. Jyothilal at a ‘Round Table of Energy Transition in Kerala’s Electricity Sector’ organised by Asar, Equinoct, and Society of Energy Engineers and Managers (SEEM).
‘’Kerala can start this transition by scaling back purchases from Central sector power stations, replacing that quantum of power with new renewable energy either generated within the State or purchased through contracts with the Solar Energy Corporation of India (SECI),’‘ it said.
The per-unit cost of generation for Central sector power plants has risen by 12% from ₹3.4 per unit in 2021-22 to ₹3.8 per unit in 2022-23, an indication of coal power’s inflationary trajectory, according to the report. It recommended that the State’s model should ideally focus on distributed generation (wind power and rooftop, ground-mounted, multi-use agricultural photovoltaic, and floating solar photovoltaic).
The report also urged Kerala to explore financial incentives for battery systems, as it could help meet evening peak demand. It also urged the State to encourage the repowering of wind installations with higher capacity turbines and explore offshore wind energy potential.
