Urban metro rail systems are the lifelines of any big city transporting thousands of passengers daily, at highly economic rates. They have vast operation networks with a large number of metro stations, depots, parking spaces and other premises, and run high speed trains at frequencies of minutes. For instance, the Delhi Metro Rail Corporation (DMRC) has a network of about 389 km with 285 stations spread across Delhi, Noida, Gurugram, Ghaziabad and Faridabad. A huge amount of high quality electricity is required to power such an extensive network. With the extension of routes connecting more areas and trains being added each year, the power demand for such metro corporations is increasing at a rapid pace, which is expected to exert tremendous pressure on the country’s urban power supply networks.
This huge energy consumption entails a high cost of power, approximately 34 per cent of the total input cost in the case of the DMRC, which currently pays a special tariff of Rs 6.80 per unit to Delhi discoms for its power consumption. Other metro rail corporations also pay significantly high power tariffs to their local discoms like most bulk commercial and industrial (C&I) power consumers. For instance, Chennai Metro Rail Limited (CMRL) pays Rs 8 per unit to the Tamil Nadu discom. This entails significant power cost, which is increasing year on year due to the rise in grid tariffs as well as the expansion of the metro network. Thus, in order to reduce their operational expenses, metro rail corporations started using solar power extensively and are deploying solar projects on their depots, metro stations, parking spaces, and other buildings and workshops.
Rationale for solar
Solar power plants can be easily implemented on rooftops or level land or even reservoirs, over bridges and along rail tracks. Solar power tariffs are also significantly lesser compared to those of grid-based power. Another important driver of the increased solar power uptake by metro corporations is the widespread adoption of the opex model, which creates a win-win scenario for them. This arrangement requires zero capital investment from metro corporations, and they are also free from the hassle of setting up and operating these projects. The developer is selected through an open e-tender to ensure transparency and supplies solar power at an affordable tariff, along with operating and maintaining these plants for 25 years. For instance, the Noida Metro Rail Corporation (NMRC) will be reportedly charged Rs 3.25 per unit by the developer, Sukhbir Agro Energy Limited, for 25 years for deploying 10 MW of solar power. This is quite low when compared to the C&I tariff charged by discoms and is proving to be extremely viable for metro corporations generating enormous savings that can be diverted elsewhere. A case in point is DMRC, which is expected to achieve total savings of more than Rs 75 million per MWp in electricity bills through its rooftop solar plants. Similarly, CMRL’s 410 kWp solar plant at Koyambedu, commissioned in October 2018, generates around 55,350 units per month, saving around Rs 1.45 million per year.
To take the maximum advantage of solar power, DMRC is planning to slowly phase out thermal energy by 2021 by sourcing more solar power. It has installed 32.4 MWp of rooftop solar capacity as of January 2020 and has plans to install another 50 MWp by 2022. In fact, all metro stations and depots on the Magenta Line of DMRC have rooftop solar projects. In December 2019, DMRC announced that all future buildings of the Delhi metro will be designed to accommodate rooftop solar panels. Similarly, NMRC is implementing rooftop solar projects at all its 21 stations. Other metro corporations also have ambitious solar uptake plans. For instance, Kochi Metro Rail Limited (KMRL) expects to install solar capacity on 2.5 hectares of land by 2020, which will be used to power all the stations and depots as well as 13 buildings of the metro corporation. KMRL is already set to source 40 per cent of its power requirements from solar energy, and efforts are under way to increase its reliance on solar power to 60 per cent by 2020. Nagpur Metro Rail Corporation Limited is also planning to install 30 MW of solar capacity to cater to 40 per cent of its power requirements.
As metro corporations plan to procure solar power extensively for reducing their operating costs, this space witnesses a lot of tendering activity to select developers for selling solar power at competitive tariffs. In February 2020, the Mumbai Metropolitan Region Development Authority (MMRDA) floated a tender for 4.43 MW of rooftop solar projects at a station site of the Mumbai Metro Rail Project at Lines 7 and 2A. The projects will be developed in the renewable energy service company (RESCO) mode and a power purchase agreement (PPA) will be signed for 25 years. The bidders will also be responsible for operations and maintenance of the project. Prior to this, MMRDA had issued a tender in March 2019 for the development of the 7.63 MW rooftop solar projects at the stations of Line 2A and Line 7 of Mumbai Metro Rail Project in the RESCO mode.
Not limited to solar power, CMRL issued a tender in February 2020, to select contractors for supplying renewable power from group captive open access projects. The bidder must bid for the selected generation source based on CMRL’s requirement. The generation sources include wind, solar and wind-solar hybrid. The requirement from solar projects is 90 MUs per year, 72 MUs per year from wind, and 90 MUs per year from wind-solar hybrid projects. CMRL will enter into a PPA with the successful bidder for 25 years. The maximum tariff payable to the project developer has been set at Rs 3.50 per kWh for the entire period.
While net metering approvals are mostly given to projects with capacities of up to 1 MW, in a landmark case, the Uttar Pradesh Electricity Regulatory Commission allowed NMRC to install 10 MW of rooftop solar power projects with a net metering facility in January 2020. NMRC had filed a petition asking the commission to relax the 1 MW ceiling for net metering so that it could install 10 MW of rooftop solar projects at 21 metro stations, depots and parking areas on the Noida-Greater Noida metro corridor.
To expand its solar power capacity further, DMRC won 3 MW in the Solar Energy Corporation of India’s (SECI’s) tender for setting up 2,000 MW of grid-connected solar projects (Tranche I) under the second phase of the central public sector undertaking scheme in September 2019. The projects have been allocated through the viability gap funding route. These projects will be developed on a build-own-operate basis. Not limited to rooftop solar, DMRC started procuring about 2 MW of power from a 12 MW waste-to-energy project in June 2019. The project has been set up by East Delhi Waste Processing Company Limited (EDWPCL) in Ghazipur, Uttar Pradesh, and is based on public-private partnership among the Delhi government, the East Delhi Municipal Corporation and EDWPCL. DMRC will procure about 17.5 MUs of power per year from this facility, which will be used by its Vinod Nagar receiving substation. In addition, DMRC became the first C&I consumer of its kind to source solar power through the open access route from another state in April 2019. It started receiving 27 MW of solar power from Rewa Ultra Mega Solar Limited in Madhya Pradesh, which is soon to be increased to 99 MW or 345 MUs. This power is being used to meet the energy demand of DMRC Phase III, and even after applying the relevant open access charges, results in significant savings for the corporation. This historic power procurement has opened up attractive and affordable opportunities for other similar corporations to procure renewable power.
The way forward
With increasing urban pollution and related health hazards, city administrations and state governments have been focusing on transitioning from fossil fuel-based transport to green transport. While the impetus is on promoting electric vehicles with various financial incentives and charging infrastructure development, urban metro rail systems, an alternative key transport option, are far ahead on the way to becoming green. With extensive networks and premises, metro corporations are ideally placed to deploy large capacities of solar plants and many of them have already moved ahead in this direction. In addition, their tremendous power requirements make them a suitable procurer of open access power from large renewable energy parks.
The key challenge in procuring such large amounts of renewable power is its intermittency issue, which can be tackled by deploying energy storage systems. Although not very cost-effective at the moment, they can be combined with solar, wind and hybrid solutions to address any uncertainty issues. As far as the cost is concerned, a SECI auction in January 2020 for peak power supply using solar, wind and energy storage saw tariffs in the range of Rs 6 to Rs 7 per unit.
Similar power procurement options for metro corporations are highly attractive as they need maximum power during the morning and evening office commute hours. In another auction in May 2020, Rs 2.90 per unit was the winning tariff for the supply of round-the-clock renewable power through solar, wind, hybrid and energy storage systems. CMRL is already moving in this direction with its recent tender for group captive open access projects. Going forward, it is expected that more metro corporations will follow in its footsteps, so that greater quantities of renewable power can be sourced, thereby significantly improving their commercial viability.
However, these growth plans might get impacted in the short run, due to the unprecedented crisis owing to the coronavirus pandemic, which has halted construction activity and stalled imports of solar equipment. Even so, the industry is confident that this is going to be a short-term impact and the pandemic might actually create a more favourable case for C&I solar projects. As KushagraNandan, co-founder, SunSource Energy, says “The future outlook of the C&I rooftop solar segment is positive as the grid power tariffs consumers pay are expected to increase with discoms incurring heavy losses. This will drive another growth story in the C&I segment.”