Can a company meet 100% of their energy requirement from renewable energy?
Mitesh Chaudhary 11 June, 2020 | Thursday
Many companies (Indian and Multi Nationals) have this question in front of them. i.e. How can we meet 100% of our energy requirement from Renewable Energy (RE). I am sure many of my counterparts in their respective companies have faced this. Not only my industry colleagues but also a lot of maintenance, operation and plant managers would be interested to know the answer to the above question.
Let me start with Why? Why does a company require to meet 100% of their power requirement from RE? Many companies have disclosed that they would reduce their carbon footprints to zero by 2025 or 2030. Practically if a company has to reduce its carbon footprints to zero it has two options - first Shut down their plant and all the operations (obviously this is not an option) and second source 100% of their power from RE. Further this answer has two facets to it - high environmental concern to minimise the carbon footprint and economical benefit.
In India, we all have made a notice of RE reaching Grid Parity i.e. the cost of solar/wind/wind solar hybrid is now on par with power generated from Coal. And if such RE can be directly sourced from power generators with long term contracts then this could certainly help in economical benefit. Next question comes is how to maximise the benefit and also reach 100% RE goal? Frankly speaking, most of the state in India have got certain restrictive regulation or policy which restricts the offset from Open Access power (Offsite RE projects) or from an onsite power plant.
Listing down a few below:
- Contract Demand Restriction - Some of the states do not permit the RE projects capacity to be more than Contract Demand (CD) of the Consumer or 50%/80% of the CD.
- Banking norms - Banking of power is permitted only on month on month basis. This is a major roadblock for wind power sourcing as majority of energy is generated during the monsoon season and there is a high probability that the generator has to forgo the excess generation without any utilisation during those months.
- Power adjustment - As most of us are aware that the generation from RE is not consistent throughout the day i.e. Solar generates during the day and wind generates largely during the night period. Again, most of the states have a restriction on adjustment of power generated during different time of the day i.e. power generation during the day cannot be adjusted in the peak or power generated at night cannot be adjusted against the day. For large consumers you could mix and match two different source of renewable energy such as wind and solar to leverage their complementary nature in generation even then the maximum power that you can meet somehow is restricted to ˜60% with this restriction.
If all the above mentioned points are combined then in usual cases the power offset from RE is restricted to probably 50% of the consumers' regular requirement. And if the Consumer also opts for rooftop solar then the consumer can meet about 5% of their consumption further. What about the remaining power right? Practically as on date it is not possible to source the remaining power from RE. The next best alternate but not cost effective solution at this point in time is Energy Storage.
Energy storage seems to be the only connecting link which can absorb the erratic generation from RE and provide stable output as per requirement of a consumer. Not only it meets the requirement of a consumer but also helps in maintaining the grid frequency. However, at this point in time the grid scale energy storage solution is not cost effective and if coupled with the cost of RE power and the grid's charges and losses, the total landed cost is much higher than the current power procurement cost from local Distribution Company. And therefore, we can only wait and hope for cost of Energy Storage Solution to reach grid parity as soon as possible then only most of the companies can meet their commitment.