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NTPC poised to facilitate India’s bid to achieve its ambitious National Renewable Energy Targets

The 44-page report titled "NTPC as a Force in India's Electricity Transition" showcases how the government is shifting rapidly towards a low-carbon economy

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New Delhi, May 26: The state-owned conglomerate NTPC Ltd — long associated with coal-fired power generation — is poised to facilitate India’s bid to achieve its ambitious national renewable energy targets. This, at a time overseas investors are seeking more opportunities in the country’s renewable projects.

“Despite its deep historical connection to coal-fired electricity generation technology, NTPC has recently moved to the forefront of India’s energy transition and stands to be the country’s key new energy enabler,” said a report by the US-based Institute for Energy Economics and Financial Analysis (IEEFA).

The report’s release coincided with the completion of three years of Prime Minister Narendra Modi’s government at the helm on Friday.

The 44-page report titled “NTPC as a Force in India’s Electricity Transition” showcases how the government is shifting rapidly towards a low-carbon economy — a step towards achieving the 2015 Paris Climate Agreement aim of cutting greenhouse gases from burning fossil fuels.

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The company currently provides about a quarter of India’s electricity and is among the top 10 coal-fired power generators in the world. It ranks third in coal-fired capacity and seventh in generation.

The role NTPC — earlier called National Thermal Power Corporation — is now playing in transforming the energy sector in its ongoing shift away from the increasingly stranded assets of the fossil fuel industry cannot be underestimated, Tim Buckley, Director of Energy Finance Studies Australasia with the IEEFA, told IANS via email.

With economic growth at 7-8 percent annually, India is the world’s fastest-growing major economy. As a state-owned power utility, NTPC’s priority is to underpin that growth.

Whilst this responsibility has arguably required expansion of coal-fired power generation in the past, this has changed.

“With the average new solar tariff in 2017 below NTPC’s coal-fired power tariff for its existing fleet, it is clear that renewable energy offers a cheaper way to provide power,” report co-author Buckley said.

Solar prices hit a record low twice this month.

On May 10, India finalised a new auction at the Bhadla solar park in Rajasthan with the award of a power tariff at a record low Rs 2.62/kWh ($0.040/kWh), 12 percent below the previous record low Rewa solar tariff awarded only just three months ago in Madhya Pradesh.

This new record only lasted two days with the latest 500MW solar auction coming in at Rs 2.44/kWh ($0.038/kWh), down yet another seven per cent.

This tender was also for projects at the Bhadla Phase IV solar park.

“The ongoing Indian electricity transformation, which can be increasingly spearheaded by NTPC, will have global ramifications not least for the thermal coal sector which faces a technology driven structural decline,” Buckley said.

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Energy Minister Piyush Goyal’s plan to cease thermal coal imports by the end of this decade is being led by NTPC which has already stopped them this past fiscal year.

“Coal exporters that are looking to India to prop up volumes as China continues to reduce coal consumption are going to be disappointed,” he said.

The report, also authored by energy finance analyst Simon Nicholas, says overseas investors are now seeking more opportunities in Indian renewable projects.

India’s renewables boom is attracting the attention of a diverse range of leading overseas investors, including banks, utilities, pension funds and asset managers. They include Goldman Sachs, JP Morgan, Morgan Stanley, the Macquarie Group, Sembcorp, Enel, EDF, Engie, SoftBank and Brookfield.

The IEEFA, which conducts research and analyses on financial and economic issues related to energy and the environment, says the total renewable energy capacity additions in India matched thermal capacity additions for the first time in 2016-17.

The rate of thermal capacity additions declined 50 percent from the prior year, even as solar installations doubled in 2015 and again in 2016.

The report forecasts that this will be repeated again in 2017.

According to financial experts in India, there is a noticeable spike in solar investment by Chinese firms.

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“Chinese investments in Indian coal projects have been declining. At the same time, Chinese investments in India on solar projects are slowly increasing,” Jai Sharda, a founding partner with equity research Indian firm Equitorials, told IANS.

Greenpeace India senior campaigner Nandikesh Shivalingam says it is an opportunity for China to play a much more positive role.

“Given that India has an ambitious renewable energy target and China being the largest exporter of renewable energy equipment in the world, there would be an opportunity for China to play a much more positive role,” he said.

India’s draft “Ten Year Electricity Plan” calls for a staggering 275 GW of renewable energy by 2027, in addition to 72 GW of hydro and 15 GW of nuclear energy. (IANS)

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India’s Ties with Bangladesh at their Peak

In a caustic comment it said that while details of the lavish meals prepared for the Bangladeshi leader were enthusiastically reported

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India, Bangladesh, Prime Minister
A Bangaldeshi media report claimed that there was little information available in the public domain about the agreements. Pixabay

Bangladesh Prime Minister Sheikh Hasina returned to Dhaka from a successful four-day visit to India last week having concluded seven agreements. But the agreements have caused unease among many in Bangladesh. Critics have panned the agreements as mainly advantageous to India and of little benefit to Bangladesh. Other commentators have called on the government to publish full details of the agreements.

India and Bangladesh signed seven agreements and MOUs on October 5, 2019 and a Standard Operating Procedure (SOP) agreement for transportation of goods. The agreements include a pact for supply of LNG as well as water from Feni River to India, and for transportation of Indian goods through Chittagong and Mongla ports in Bangladesh to Tripura.

A Bangaldeshi media report claimed that there was little information available in the public domain about the agreements. In a caustic comment it said that while details of the lavish meals prepared for the Bangladeshi leader were enthusiastically reported on by the Bangladeshi media, there was no information on the nature of the agreements.

The agreements to provide connectivity were described as regional connectivity, but one critic termed them bilateral connectivity as they served Indian interests and had scant benefit for Bangladesh. “India certainly stands to benefit, but Bangladesh is yet to make a tangible assessment of its gains,” it said.

India, Bangladesh, Prime Minister
India and Bangladesh signed seven agreements and MOUs on October 5, 2019 and a Standard Operating Procedure (SOP) agreement for transportation of goods. Pixabay

India’s smaller South Asian neighbours have often perceived New Delhi as exploitative for using its clout to negotiate one-sided agreements advantageous to India while ignoring its neighbours’ interests.

Sheikh Hasina defended her government’s decision to supply 1.82 cusecs of water from the Feni river to India for drinking water purposes as a very small amount of water.

“If someone asks for drinking water, how can we deny it?” she said.

Regarding the agreement to supply of LPG, she added that it was not CNG that Bangladesh would be selling to India, but LPG, which was a byproduct in the refining of oil. In 2001, the possibility of selling natural gas to India had become a major controversy in Bangladesh with Sheikh Hasina’s Awami League party objecting to the sale of a scarce resource.

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The agreement to supply Feni river water has rankled as there has been no movement on finding a resolution on the sharing of Teesta River waters. The criticism acquired a serious turn with the murder of a second year student of the Bangladesh University of Engineering and Technology by fellow students for criticizing Sheikh Hasina and the agreements in a Facebook post. The students were allegedly members of the Chhatra League, the youth wing of the ruling Awami League party.

India’s ties with Bangladesh are at their peak, among the best of India’s relations with its South Asian neighbours. But the criticism of the agreements with India is evoking memories old irritations and suspicions.

There are several pending issues between India and Bangladesh such as the huge trade deficit and sharing of Teesta river waters. Dhaka has been remarkably patient over New Delhi’s problems in agreeing to a resolution on sharing of the river waters.

Sheikh Hasina’s government has accepted Prime Minister Narendra Modi’s assurance that he would work towards a satisfaction resolution to the ticklish issue. The main impediment on the Teesta issue is the stance of the Mamata Bannerjee-led West Bengal government.

India, Bangladesh, Prime Minister
The agreements include a pact for supply of LNG as well as water from Feni River to India, and for transportation of Indian goods through Chittagong and Mongla ports. Pixabay

The National Register of Citizens exercise in Assam with identification of illegal migrants has raised grave concern in Bangladesh. Sheikh Hasina has accepted for now the Indian stance that it is an internal matter of India. But comments by Indian leaders about pushing out the foreigners have their ripples in Bangladesh which facile assurances do not alleviate.

Building trust between the two neighbours has been a slow and steady process that involved wiping away the mistrust and suspicion that that had plagued relations for long. The resolution of the sharing of the Ganga waters removed a major irritant in the ties.

Sometime later, Bangladesh Prime Minister Sheikh Hasina’s assurance that Bangladesh territory would not be used for anti-India activities and its effective implementation became the first major step in building the trust. The resolution of the Land Boundary Agreement for demarcating the border was the second positive factor in generating trust and confidence. It created the environment for closer cooperation between the two countries. Both Dhaka and New Delhi have used the friendly environment to construct a cooperative relationship.

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New Delhi can easily lose that goodwill if the sentiment that India is uncaring and lackadaisical about issues of interest to Bangladesh begins to gain ground in Dhaka. New Delhi needs to be more sensitive to Dhaka’s concerns. It should speed up tackling the long pending issues before they build up into a major grievance in Bangladesh, which could make it difficult to implement already concluded agreements. (IANS)