The Maharashtra Government on Tuesday signed MoUs with NHPC (earlier National Hydroelectric Power Corporation) and Torrent Power for the development of two pumped storage projects (PSPs) with a generation capacity of 13,050 mw with a total investment of Rs 71,000 crore . NHPC will develop a 7,350 mw project which entails an investment of Rs 44,000 crore and Torrent Power 5,700 mw by investing Rs 27,000 crore. Both these companies have identified sites in Pune and Konkan. MoUs were signed in the presence of Deputy Chief Minister Devendra Fadnavis who is in charge of the energy department. These projects are expected to be commissioned in three years.
Fadnavis has asked the state energy department to set up a special cell to deal with all necessary approvals and clearances required by these developers. They are expected to acquire them in the next six months.
-These projects will come up in Pune and Konkan in next three years
-MahaVitaran enjoys the right of first refusal, if it decides to draw power it will go to state grid, if not then in the Central grid
-MoU signing comes after the Centre in April issued guidelines to promote development of PSPs
-As of now in India, 8 projects (4745.60 MW) are presently in operation, 4 projects (2780 MW) are under construction, and 27 projects (29930 MW) have been allotted by States which are under different stages of development.
-At the global level, China leads PSP market with a total installed capacity of 36 GW, followed by the United States at 22 GW and Japan at 22 GW
-The Central Electricity Authority (CEA) estimates regarding on-river pumped storage potential is 103 GW in lndia
Fadnavis said, ‘’The Centre promotes renewable energy as it is both environment-friendly and economical. Under the national renewable energy policy, we have taken an initiative to adopt PSPs. This is a model which is becoming acceptable across the world.” He further noted that PSPs can stabilise power grids within a minute.
The state government’s move to go in for PSPs is in line with the Centre’s clean energy transition path in order to reduce the emission intensity of its Gross Domestic Product (GDP) by 45% by 2030, get to 50% of installed capacity from non-fossil fuel sources by 2030 and achieve net zero carbon emissions by 2070. As of date, the Central Electricity Authority (CEA) estimates regarding on-river pumped storage potential is 103 GW in lndia. Apart from this, a large capacity of off-river pumped storage potential is also available which is being estimated. Suitable support is to be extended to the identification and evaluation of such potential.
As of now in India, 8 projects (4745.60 MW) are presently in operation, 4 projects (2780 MW) are under construction, and 27 projects (29930 MW) have been allotted by States which are under different stages of development. At the global level, China leads the PSP market with a total installed capacity of 36 GW, followed by the United States at 22 GW and Japan at 22 GW.
MSEB Holding Company Director Vishwas Pathak said, ‘’Right of first refusal lies with the state power distribution company the Maharashtra State Electricity Distribution Company Ltd (MahaVitaran). If the MahaVitaran decides to draw power from these projects, then the power will go to the state grid. If the MahaVitaran decides not to purchase power from these projects, then the power will go to the central grid. NHPC and Torrent Power enjoy an option to sell power state or the Centre.’’
Today’s MoUs come after the Ministry of Power in April this year released the guidelines to promote development of PSPs. According to the ministry, PSPS are also known as the ‘Water Battery’, which is an ideal complement to modern clean energy systems. PSPS provide the necessary scale of storage and have a long service life of more than 40-50 years. This is much more than any other energy storage technology presently available. This also results in a low cost of delivered energy over the life of the projects. PSPs are also non-polluting and are more environmentally friendly’ Pumped Storage Projects account for over 95 percent of installed global energy storage capacity.
Further, PSPs are used for load balancing in electric power systems. It is a configuration of two water reservoirs at different elevations that can generate power as water moves down from one to the other (discharge), passing through a turbine. PSPs provide several benefits, such as peak shaving, frequency regulation, load balancing, backup reserve, black start capability.
According to The International Market Analysis Research and Consulting Group (IMARC Group), the India pumped hydro storage market size reached US$ 10.3 Billion in 2022. Looking forward, IMARC Group expects the market to reach US$ 18.0 Billion by 2028, exhibiting a growth rate (CAGR) of 9.75% during 2023-2028.
As per the guidelines , state governments may allot project sites to developers through various ways, including competitive bidding, tariff-based competitive bidding process and on nomination basis to CPSUs and state PSUs.
Developers shall start construction work within a period of two years from the date of allotment of the project, failing which allotment of the project site shall be cancelled by the state. However, a one-year relaxation may be granted on a conditional basis, the notification said, adding that no upfront premium will be charged for project allocation. States may exempt land to be acquired by off-the-river PSPs from payment towards stamp duty and registration fees. Government land, if available, may be provided at a concessional rate to the developers on an annual lease rent basis, reads the guidelines.
Furthermore, PSPs may be supported through concessional climate finance. Sovereign green bonds issued for mobilising resources for green infrastructure as a part of the government’s overall market borrowings may be deployed in the development of PSPs which utilise renewable energy for charging.
