renewable energy
How industry leaders optimize performance of renewable and energy storage assets?
Solar Media organized a conference around how the industry leaders optimize the performance of their renewable and energy storage assets.
Fluence has a mission to transform the way we power our world to create a more sustainable future. BTE Renewables is one of Africa’s leading renewable energy companies, with a portfolio of nearly 500MW of wind and solar PV projects in South Africa and Kenya.
Gianmarco Pizza, Head of Digital Asset Performance Management, Fluence, said there are common challenges in asset performance management. These include data management, issue identification, portfolio visibility, maintenance planning, and technical and financial reporting.
Large-scale assets means large-scale data collection. Energy storage capacity is projected to
increase 20x from 2021-2030. Another challenge of data management is improving time to value with data automation. Data collection is automated, with proven data collection process of various asset types and OEMs. Data quality involves cleansing/filtering to maintain high level of data quality and focus on essential metrics. Data harmonization is standardized and scalable data model across assets. Data storage has secure and redundant storage of the whole operational history, from the CoD. Finally, long-term support with ongoing database management, cyber security, and maintenance.
As per an Asset Manager, Renewable Investment Fund: “What we’ve achieved with Nispera so far gives us confidence that we can continue adding more assets to the portfolio without requiring additional data analytics resources. It saves us the cost of hiring at least one or two people that we would otherwise need in-house to manage this volume of data.”
In portfolio visibility, we have disparate assets and technologies that limit scalability. Data is also spread across multiple systems to manage asset portfolio. We need to be achieving a comprehensive view of all assets.
With issue identification and prioritization, there is difficulty understanding and prioritizing issues and alerts. We can look at addressing common asset operational issues with AI. These can be identifying PV tracker faults, tracking wind turbine performance, and detecting battery temperature anomalies.
For maintenance planning, it is better to move from reactive to proactive. We can anticipate and plan, track performance to ensure resolution, and communicate with stakeholders.
Lastly, technical and financial reporting. Ad-hoc reporting is time-consuming and error-prone. Operators may spend countless hours collecting and harmonizing data from various sources to generate diverse technical and financial reports. We can generate reports from a single source of organizational truth. There are different metrics to focus on based on asset types.
Best practices
For solar, there are tracker position, actual production, improvement potential, irradiance, and system efficiency. For wind, there are actual production, improvement potential, wind direction, and grid limit, power curves, and rose charts. For storage, there are charging profiles (charged and discharged energy), average SoC, and actual vs. contractual availability.
There are some best practices to follow. Flexible reporting can meet the needs of different stakeholders and time horizons. Intuitive reports that are fast to read and convey key information for quick consumption. Consistent, auditable data creates a system of record for historical information and reports. Convert power metrics (MW and MWh) into commercial metrics for financial stakeholders.
Stefan Van Niekerk, Head of Operations, BTE Renewables, stated that BTE reports address different stakeholder needs. Intuitive charts show budgeted vs. actual YTD performance at the portfolio level for executive overview. An AI-powered digital twin spotlights the under-performance, enabling prompt investigation and resolution.
Fluence’s Nispera is a next-generation asset performance management software for renewables and storage. Nispera helps the asset owners maximize asset value. These include asset and portfolio optimization. It results in a typical annual profitability uplift of 3-10 percent. Customers across the globe trust Nispera, including BTE Renewables, Lekela, Pampa Energia, PacificHydro, PEC Energia, Terna, Wirtgen Invest, etc.
Round-up 2022: War, chips, and back to overseas travels!
Year 2022 has been quite eventful! With the Russia-Ukraine war, alongside Covid-19, things have gone downward for the global semiconductor industry. Next year, we all hope that the industry bounces back much more stronger.
Semicon dip in 2023?
World Semiconductor Trade Statistics (WSTS) released its semiconductor market forecast generated in Nov. 2022. Following a strong growth of 26.2 percent in 2021, WSTS revised its forecast down to a single-digit growth for the worldwide semiconductor market in 2022 with a total size of $580 billion, up 4.4 percent, for 2022.
For 2023, the global semiconductor market is projected to decline by -4.1 percent to $557 billion, driven by the memory segment, according to WSTS. Will that happen? Let’s see!
Some categories are still expected to see double-digit year-over-year growth in 2022, led by analog with 20.8 percent, sensors with 16.3 percent, and logic with 14.5 percent growth. Memory is expected to turn negative in the forecast, and decline 12.6 percent year-over-year. In 2022, all geographical regions are seen to show double-digit growth except Asia Pacific. Asia Pacific is likely to decline 2 percent. Americas is expected to show growth of 17 percent, Europe 12.6 percent, and Japan 10 percent, respectively.
TrendForce, Taiwan, has said that YoY growth of NAND Flash demand bits will stay under 30 percent from 2022 to 2025 as demand slows for PC client SSDs. Recent headwinds in the global economy have caused a demand freeze in the wider consumer electronics market. Enterprise SSDs will succeed as major driver of demand bit growth in future. TSMC has also made moves in the USA, and now, is targeting Europe. More of that later!
Review 2022
In Jan. 2022, Future Horizons said that the global semiconductor industry grew 26 percent in 2021, and was likely to grow 10 percent in 2022. This was later revised down to 4 percent growth for 2022.
CEA-Leti organized a photonics workshop in Feb. 2022, where they talked about silicon photonics for AI, and integration of electronics and photonics. Dr. Nicky Lu, CEO and Founder, Etron, and Managing Board Director, Taiwan Semiconductor Industry Association (TSIA), spoke about start of tera-scale-integration era with optimized heterogeneous and monolithic integration at the fifth annual heterogeneous integration symposium, in Feb. 2021. Heterogenous integration impacts Silicon 3.0. Monolithic and heterogenous integration (MHI) has led to the Si4.0 era that is now ongoing.
March 2022 had HAXPES-Lab and what it can do for the electronics industry. There were key developments and implications of MWC 2022. DIGITALEUROPE, EU, had a webinar on how the Ukrainian IT industry was still standing against all odds, in March 2022.
ISQED 2022 was in April 2022, with Dr. Chi-foon Chan, Co-CEO, Synopsys discussing how to thrive in our changing environment. Digital Ts — threads, twins, technologies, and transformation, from Digital Twin Consortium (DTC), was another event.
May 2022 had MegaChips entering the US market for edge AI chips market. Display Week 2022 saw Ross Young discuss the smartphone and smartphone display market outlook. AR/VR market trends and technology outlook was presented by Guillaume Chansin, Director of Display Research, DSCC, at Display Week. It was in May that Future Horizons revised the semiconductor outlook for 2022 to 6 percent. Later, SEMI Arizona and Texas Chapters, USA, had a seminar on workforce shortage—meeting challenges for the semiconductor industry.
Semiconductor innovations
Global Semiconductor Alliance (GSA) had a conference on how diversity increases profitability. It looked at what managements can do to accelerate diversity. Honolulu, Hawaii, was the place for 2022 VLSI Symposium that looked at technology and circuits as critical infrastructure of future. Dr. Y. J. Mii, Senior VP of R&D, Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC), presented on semiconductor innovations, from device to system.
Intel 4 CMOS with advanced FinFET transistors optimized for high-density and HPC came to the fore, and there was a workshop on cryogenic electronics for quantum computing. CHIPKIT emerged as an agile, re-usable open-source framework for test chip development. We had the OpenROAD project — open source platform for IC design innovation at VLSI Symposium 2022. Chips in Europe looked at advancing innovation in semiconductor industry, by SEMI Europe.
BloombergNEF summit in New Delhi talked about 2-4x investment that was needed to meet the net-zero targets by 2050. Semiconductor Industry Association-Semiconductor Research Corp., (SIA-SRC), USA discussed the future of semiconductor hardware. At Automatica 2022, Siemens’ showcased NX industrial electrical design to boost engineering productivity.
In July 2022, I wrote about why more women are definitely needed in semiconductors! Boreas Technology advised how piezo haptics will create their own market by introducing novel haptic apps. At Semicon West 2022, Ms. Laurie E. Locascio, Under Secretary of Commerce for Standards and Technology Director, National Institute of Standards and Technology (NIST), talked about how all parts of the US Chips Act need to be closely co-ordinated.
Andrea Lati, Director, Market Analysis, TechInsights, mentioned the semiconductor capital spending and equipment outlook for 2022. Christian Gregor Dieseldorff, Senior Principal Analyst, SEMI, discussed the trends and forecast for fab equipment spending, capacities, and new fabs.
NASA invites me!
Dr. Michael McCreary, Chief Innovation Officer, E Ink Corp., at Flex 2022, Semicon West 2022 stated how electrophoretic display was changing the look of autos, transportation, and beyond. Dr. Dawson Cagle, Program Manager, IARPA, talked about how IARPA’s smart e-pants were weaving electronics into textiles. In July, I was invited to attend NASA’s SpaceX CRS-25 launch to International Space Station. That was really something spectacular to behold!
Dr. Ms. Kate Darling, leading expert in Robot Ethics and MIT Media Lab Research Specialist, MIT Media Lab, talked about the future of human-robot interaction at Sensors Converge 2022. SIA discussed investing in innovation: blueprint for enduring American semiconductor leadership. Silicon-based quantum computing as a disruptive paradigm, was presented by Dr. Maud Vinet, Quantum Hardware Program Manager, CEA Leti, at Scaling and Lithography Tech Talks, Semicon West 2022.
Aug. 2022 saw how the EU Chips Act was necessary for accelerated digital transformation. I clarified whether people think I am very good in semiconductors? Dr. Henning Schröder, Group Leader, Fraunhofer Institute for Reliability and Micro-integration IZM, presented on glass-based quantum photonic packaging.
Agri-PV harvesting the opportunities of solar + farming started off Sept. 2022. Quantum dot imagers bridging SWIR accessibility gap was presented at SEMI MEMS & Sensors Summit 2022. Malcolm Penn, Future Horizons, revised global semiconductor growth forecast to +4 percent for 2022; with downturn likely ahead in 2023! Let’s see!
New materials required
SEMICON Taiwan 2022 Power & Opto Semiconductor Forum addressed how new materials are required to solve technology challenges, and support growth of electronics. SEMI, USA, looked into the future of computing in 2040. Center for the Study of the Presidency and Congress (CSPC), USA organized a conference on the US Chips Act and implementation. Xecs, Europe, maintained its focus on electronic components and systems.
Oct. 2022 had a session on time-sensitive networking (TSN) and future of connectivity by the Industry IoT Consortium (IIC). Satellite quantum key distribution moving to industrialization phase was discussed by the European Photonics Industry Consortium (EPIC). I also made my first overseas trip to Dubai, post the pandemic, to attend an event.
In Nov. 2022, SEMI, Northwest Chapter, USA, organized a conference on ‘The Future of More Than Moore—Chiplets, Advanced Packaging, and More’. Ms. Amy Leong, SVP, CMO, GM Emerging Growth/M&A, FormFactor Inc., presented on strategy for wafer probe in a chiplet world. Luc Van den hove, President and CEO, imec, discussed how future of scaling needs system-level thinking and STCO at IMT 2022. Japan intimated how it was gearing up to re-transform computing power and semiconductors.
Las Vegas and KA
Las Vegas, USA, welcomed me back, again, after 15 years, for an industry event. May I also mention KA, a spectacular show from Cirque de Soleil, that I witnessed. Featuring 80 artists from around the world, KÀ is a gravity-defying production featuring powerfully emotive soundtrack that enhances the innovative blend of acrobatic feats, Capoeira, puppetry, projections, and martial arts. Great experience! I also bumped into an angel or Pari, mid-air, en route to New York. 🙂
Next, there was Semicon Europa 2022 in Munich, Germany, which included ITF Beyond 5G. Among the topics discussed were compound semiconductor epitaxy core of next-gen connectivity. Chips are now the new oil, was proclaimed by Laith Altimime, President, SEMI Europe! I cannot express how happy I am to hear this! More of it later!! There were talks about building scalable and ultra-coherent quantum computers with carbon nanotubes, metaverse, future of air travel, among topics at Semicon Europa 2022. Later, there was IEEE Standards Association (SA) workshop on 5G and beyond in New Delhi.
Dec. 2022 began with an SIA seminar that looked at the growing challenge of semiconductor design leadership. Design costs are rising with every new technology node. Moore’s Law scaling has not been keeping pace. New improvements are required in design and packaging.
There are challenges to global semiconductor manufacturing. Geopolitical tensions are creating risks of disruption and shortages. Semiconductor industry is suffering from a lack of attractiveness and qualified talent. Besides, we have global warming threat and need for sustainability programs. Countries also need to create enough incentives for manufacturing investments.
Still in Dec. 2022, the 68th International Electron Devices Meeting (IEDM) 2022 was held in San Francisco, USA. IEDM celebrated its 75th birthday this year. There were five focus sessions on advanced heterogeneous integration: chiplets and system-in-packaging, quantum information and sensing, special topics in non-von Neumann computing, DNA digital data storage transistor-based DNA sequencing, and bio-computing, and implantable-device technology.
Fusion ignition achieved
US Department of Energy (DOE) and DOE’s National Nuclear Security Administration (NNSA) announced the achievement of fusion ignition at Lawrence Livermore National Laboratory (LLNL)—a major scientific breakthrough decades in the making that will pave the way for advancements in national defense and the future of clean power. On December 5, a team at LLNL’s National Ignition Facility (NIF) conducted the first controlled fusion experiment in history to reach this milestone, also known as scientific energy breakeven, meaning it produced more energy from fusion than the laser energy used to drive it.
For the first time, researchers produced more energy from fusion, than used to drive it. This promises further discovery in clean power and nuclear weapons stewardship. This historic, first-of-its kind achievement will provide unprecedented capability to support NNSA’s Stockpile Stewardship Program, and will provide invaluable insights into the prospects of clean fusion energy. It would be a game-changer for efforts to achieve President Joe Biden’s goal of a net-zero carbon economy.
TSMC leads
On December 6, TSMC announced that besides TSMC Arizona’s first fab, which is scheduled to begin production of N4 process technology in 2024, it has started construction of a second fab, scheduled to begin production of 3nm process technology in 2026. When complete, TSMC Arizona’s two fabs will manufacture over 600,000 wafers per year, with estimated end-product value of more than US$40 billion.
TSMC is also reportedly in advanced talks for setting up its first potential European plant in Dresden, Germany. The plant could begin construction by 2024. This will be probably signed sometime in 2023.
National Institute of Standards and Technology (NIST) organized a session on US CHIPS and Science Act. Ms. Gina Raimoldo, Secretary of Commerce, USA, said teams are working to ensure implementation and future impact of US Chips Act. USA is also nudging TSMC to do more in the USA.
Dec. 16, TrendForce reported that YMTC may abandon the market for 3D NAND Flash by 2024 following the US Government’s decision to place it on entity list. Well, that may be bad news for China and flash memory market.
That reminds me! I came across a post on LinkedIn, where technologies were being discussed for semiconductors by lots of big names. Ok, my name was not included! 🙂 That’s fine. Here is a list that may be looked up: nanosheets, vertical-transport nanosheet field-effect transistors (VTFETs), compound semiconductor epitaxy, quantum communications, biosensors, glass-based quantum photonic packaging, 3D hybrid electronics, piezo haptics, system-on-multichip (SoMC) architectures, tera-scale-integration, KOOL DRAM, etc. Oh, it was my BDSM moment, surely! 😉
And, that’s it, folks! 🙂 One sincerely wishes that the global semiconductor industry, and semiconductor market, are back to the top again, in 2023. Warm wishes to everyone for a very successful and vibrant 2023.
PS: Edson Arantes do Nascimento, or Pele, Brazil, and football world’s superstar, is no more. Rest in peace, ‘O Rei’, the greatest!
Top technologies enabling net-zero grid of the future
Managing the power grid, while integrating intermittent renewables, is one of the great challenges in the energy transition. Electrification is a key pathway to decarbonizing the global economy, and we will need lot of electricity.
In 2020, solar made up just 3 percent of the generation. It is too small to impact the reliability of the system. We need lots of power, but little energy for managing short-term fluctuations.
Chris Robinson, Research Director, Lux Research, said by 2050, solar would make 33 percent of the generation. Systemic changes are required for how we plan and operate the electrical grid. We don’t have much time to innovate, based on net-zero targets. For zero-carbon grids, new technologies are needed. Integrated resource plans are where battles over net-zero grids will be decided. Effective load carrying capability (ELCC) is a critical concept for reliability.
Three solutions
ELCC isn’t constant, and typically decreases for renewables with increasing renewables penetration. Three solutions are needed for enabling net zero electricity. We need flexible demand, variety of generation, and long-duration energy storage.
For flexible demand, key technologies include DERMS, bidirectional EV charging, load forecasting, DER marketplaces, smart devices/meters, microgrids, behind-the-meter storage, etc. A virtual power plant indirectly benefits grid reliability, and lacks strategic control of DERs by grid operators. DER marketplaces provide transparent signals on available capacity by DERs. It faces some regulatory barriers. Project traDER includes two wind generators, 134 electric storage heaters from Kaluza, and two domestic scale batteries from SMS.
For variety of generation, in winter 2021, low gas capacity due to weather issues was offset by other sources of generation, such as nuclear, wind, and coal. Key technologies include marine power, geothermal power, and nuclear power. Companies are also entering pilot stage in marine power over the next few years. Geothermal and nuclear plants have near-flat, and flat generation profiles.
For long-duration energy storage, we have technologies such as flow batteries, zinc-air batteries, compressed air energy batteries, etc. Levelized cost of storage (LCoS) is a simplified way of comparing costs of different battery technologies. So far, we haven’t needed anything beyond Li-ion batteries. We will move to hydrogen later, with 10,000 MW system power. It is very expensive today.
In future, electricity will become more expensive. Today, demand response programs and VPPs are responsible for providing flexibility. California’s Emergency Load Reduction Program unlocks DEC flexibility. AutoGrid and Zum partnered to create 1GW VPP using electric school buses and bidirectional charging. We will also need flow batteries, mechanical storage, and hydrogen storage facilities in the future. ELCC is crucial for net-zero grids. Utilities should plan for increased demand flexibility. We have an opportunity for long-term projects.
2-4x investment needed to meet net-zero targets by 2050: BloombergNEF summit
BloombergNEF Summit 2022 was held today in New Delhi, India. It provides the ideas, insights and connections to formulate successful strategies, capitalize on technological change and shape a cleaner, more competitive future.
Jon Moore, CEO, BloombergNEF, welcomed the audience. We have a ‘think different’ campaign. Coal has dominated India’s power sector so far. India has the most ambitious renewable targets after China. India boasts best-in-class renewables cost. Strong, clean energy policies are the backbone of India’s energy transition. India also leads G-20 in 2021 renewables auction capacity.
Road transportation is another market set to be transformed. Globally, different sectors are in different states of readiness. The importance of segments varies by markets. China is leading in two-wheeler EV market. India can be a key leader, outside of China. Bus electrification is a major opportunity. Canada has been investing more. Charging infrastructure will grow and attract investment. Battery demand will also see huge growth. Fleet electrification deals are a great place to start. EVs already avoid 1.5 million barrels of oil demand per day. India has been rising in policy scorecard due to power and transport.
Today, global investment targets are being set. This is a $100 trillion opportunity. Global investments levels have been rising. 2-4x investment is needed to meet net-zero targets by 2050. Local investment has been increasing again, in India. Last year saw huge spike in green bonds. Local investment has been happening. Private finance needs enabling environment and experience.
ESG, the Indian way!
The opening session was a discussion around ESG with Injeti Srinivas, Chairman, IFSCA. Nitin Jaiswal, Head of Government Relations & External Relations, Asia Pacific, Bloomberg, was the moderator.
Injeti Srinivas, IFSCA, said we are procuring lot of international financial services over $100 billion. We can bring back this business to India. We can service our own needs and export financial services. We need to align our market infrastructure with global practices. We should have full capital account convertability. We also need to have a regulator. SEZ Act has the primary objective of promoting exports. We should be able to compete with offshore jurisdictions. India is set to emerge as a leading financial center. We are competing with best of jurisdictions.
When we talk about ESG or corporate governance, CSR is a legal obligation in India. Mahatma Gandhi had said that the world has enough for meeting everybody’s needs. The Companies Act says every director has to ensure he or she works in the best interests of the stakeholders and the environment. Compliance is so far not in form, but in substance. Today, we have national guidelines. Conduct has to be responsible.
IFSCA has two centers. We have enabled green bonds, social bonds, sustainability bonds, and are working on transition bonds. India has been a late starter for green bonds. Last year, $6.8 billion was raised. India has two financial jurisdictions — local and international.
There has been the development of global sustainable finance hub. It should be focus area for regulator. To raise global capital, we have to be aligned with global principles. We should be moving towards a framework that also meets India’s requirements. We should also have a system that allows the Indian industries to migrate. There should be some sustainability frameworks. Industries that are not so green, should also be given a chance. Agriculture is a major sector. There should be some incentivization for small farmers. There are so many things to do. India is positioned to take a leadership role. Our financial system is also gearing up. The Government can also raise green sovereign bonds.
Transition strategies
This was followed by a talk on transition strategies of India’s corporations. Rohit Gadre, Senior Associate, BloombergNEF, said India’s wind and solar plants need rapid growth in capacity additions. Companies need to also manage regulatory changes. Inaction is threatening ways companies operate. India’s regulators are becoming stringent on disclosures. Companies have to report greenhouse gas emissions, waste and water management, etc. The future is not going to be easy.
The future belongs to those who are prepared. Indian companies are joining the global decarbonization initiatives. Task Force on Climate-related Disclosures (TCFD) looks at forward-looking disclosures. Net zero targets cut across sectors, from cement and energy, to finance and technology. The complexity lies in the details. Infosys, TCS, and Wipro are among the IT companies.
Indian corporates have ambitious clean energy plans for the next decade. Reliance Industries plans to invest $10 billion to create renewable energy ecosystem. Adani Group has similar plans. Government-owned energy firms are getting started on decarbonization journey. Private sector IPPs are trying to stay a step ahead of government firms. JSW Energy is building 958MW of renewables for supply to JSW Steel. Adani Solar has 3.5GW of solar cell and module manufacturing capacity. ReNew Power is setting up 2GW cell and module plant in Gujarat.
Rate hikes and supply chain disruptions are weighing heavily on renewables. Some countries and companies are tweaking their plans. Germany plans to increase use of coal power plants. China may open some shuttered coal mines. Change to low-carbon transition is going to be hard, and messy, but gorgeous.
How prepared are Indian companies?
Next, there was another panel discussion on the topic: Are Indian companies prepared for sustainable markets? The participants were Ms. Deeksha Vats, Group Chief Sustainability Officer, Aditya Birla Group, Ms. Divya Sharma, India Executive Director, Climate Group, and Anirban Ghosh, Chief Sustainability Officer, Mahindra Group.
Ms. Deeksha Vats, Aditya Birla Group, said Indian companies are ready. There is a variety of Indian companies who are defining what sustainability means for them. We now need to look at their maturity. We need to look at what does it mean to have a sustainable market.
Ms. Divya Sharma, Climate Group, agreed that it depends on the companies. Businesses take 100 percent committment. The purpose is to also influence policies that can affect the market in future. Government and businesses are there to make it happen.
Anirban Ghosh, Mahindra Group, said there are technologies that are ready for sustainable markets. Another sector is ready for sustainable financial, such as infrastucture. There can be net-zero buildings in the future. Some industries are not debt-heavy.
Sustainable market
Ghosh said there should be funding available for transition to green. An example can be sustainability-linked bonds. Ms. Vats added that we need to define areas, such as materials. We can find alternative materials. Having access to circular economy is important. There is also technology financing. To scale them up is very important. We need to look at capital and access gaps.
Ms. Sharma added that we need to have enough demand for a technology. Then, we can say the markets have become sustainable. Urban development sector has several examples. There can be enough investments and enough demand.
Ghosh added that there is a chaotic ecosystem. Every new framework gets heavily discussed. Investors need information regarding where to invest. We are in a stage where all this is developing. We are also looking to solve carbon-in-the-air problem. Investors get more information. Climate action is an integral part.
Ms. Vats, Aditya Birla Group, noted that every stakeholder needs corporates to be around so that they can continue to do business. Frameworks are very similar, and we should grow them in a responsible manner. Ultimately, the business should address the needs.
Ms. Sharma, Climate Group, said any company making commitment, needs to ensure their impact is solid. Accountability and reporting help in the impact. Climate groups also have commitments for climate action. Regulations have to support them. There can be utilities who can set up green tariffs. It is like a marriage. We have to be prepared for that.
Regarding financial investors, Anirban Ghosh, Mahindra Group, added it depends on returns to capital. Scaling up can be very easy. We need policies for renewable energy that can lead to faster adoption. Our Group wants to make our suppliers 100 percent green. We have some bottlenecks in regulation.
Ms. Vats added that we need to see how the corporates are using nature-provided solutions and ecosystem services. They also need to see the material risks and opportunities. It will encourage people to do more. We need to have clear targets and roadmap.
Funding India’s energy transition
There was another discussion about how to fund India’s energy transition? The participants were Neeraj Gambhir, Group Executive, Treasury, Markets & Wholesale Banking Products, Axis Bank, Toby Lawson, Chief Executive and Chief Country Officer, India, Société Générale, Abhishek Poddar, MD, Head Business Development of South East Asia & India, Macquarie Asset Management, and Ms. Lakshmi Iyer, CIO, Kotak Mahindra AMC, talked about targeting international financers.
Neeraj Gambhir, Axis Bank, said the opportunity is huge. The next push is going to come from the energy space. There is going to be significant opportunity. There is potential for banks to get involved in power projects. There is more confidence now. PPAs have been great, and tariffs are holding firm. There are mid-sized power producers who are involved.
Toby Lawson, Société Générale, added that India needs to finance renewables. India is great at raising capital for green bonds. To hit a target for 2030, we are looking at 20-30GW per year at least. There should be long-term PPAs, etc. State governments should also purchase renewable energy. We are comfortable with large investments. We are finding huge opportunities for financing India’s green opportunity. Large renewable players are able to tap the green market.
Abhishek Poddar, Macquarie Asset Management, said that we are optimistic about the market regarding green investments. Promoters have also changed from the conventional. Renewable platforms are today backed by global financial providers. Ms. Lakshmi Iyer, Kotak Mahindra AMC, talked about targeting international financers.
Poddar added that it is better to leave to the market to find the best way. It varies, based on the type of project. As long as the projects are viable, people should be able to raise capital.
Gambhir noted there can be projects that are localized. We can arrive at a meaningful size of the debt market. As producers have gained confidence, they have recycled capacity. It is a capital-intensive business. There is place for smaller producers.
He also talked about how banks can raise their capacities. It was the first green bond issuer. It is also about establishing credentials for ESG framework. Banks are not allowed to issue bonds, except for international financing. We should have a well diversified asset portfolio. We can invest Rs. 30,000 crore over next four years in sustainable projects.
Lawson added that you need to show commitments to international markets. We can partner with local banks who can show commitment. There is more appetite for international markets, and huge appetite for good-quality assets. India represents good-quality assets for renewable energy. Domestic market will also grow, as well. Large Indian companies are targeting sustainability, etc. Equities coming from offshore are attractive.
Poddar said that from equity side, there are dollars waiting to be invested. There are active asset managers building profiles. The India story in renewables are well known. We need to look at the broader picture. India will continue to attract capital. For green bonds, we need to improve the bond market. In infrastructure, we are talking about 15-20 years.
Gambhir said that we have seen volatility in power pricing for renewables. If we can get some assurance, new models can be taken up. Lawson added that the PPAs have fixed prices. We need to prioritize the renewables. As transition kicks pace, we can look at the chain and long-term fixed price.
Poddar said that as economies develop, lot of asset allocation can happen. As government opens that up, it can be a sought after sector. Gambhir noted that we need energy security via renewables. Lawson agreed that we need to give investors comfort. We need to see more resilience in the renewables sector.
Financing India’s 2030s renewables ambition
Financing India’s 2030s renewables ambition, was delivered by Shantanu Jaiswal, Head of India Research, BloombergNEF.
Renewables are at the heart of India commitments. Wind and solar could make up 51 percent of power generation by 2030. They will require $223 billion in financing from 2022 to 2029. Renewable project developers have raised debt from several different sources. PPA counterplay is important. There is evolution of debt financing for renewables in India. IPPs move to protect returns in face of increasing competition from PSUs. Infrastructure investment trusts are an attractive avenue for IPPs.
Investors value exit opportunities, and that is a sign of the industry’s maturity. It also helps in building new businesses in the market. Renewable projects in India face regulatory, project, and financing issues, etc.
There are measures to increase the availability of financing, such as regulatory, government support, and changes to auctions. We also looked at lessons from the international markets. There should be firm assurance on provision of government land. Auction land parcels with grid access.
BNEF London 2020 summit calls for green recovery
The BloombergNEF London 2020 Summit commenced today. Ms. Dana Perkins, Head of EMEA, BloombergNEF, was the summit anchor.
Delivering the opening keynote, Jon Moore, CEO, BloombergNEF dwelt on: how did the idea of modern art relate to the idea of energy transition? There are announcements that California is to ban new gasoline cars by 2035. China has vowed carbon neutrality by 2060. The majority of many national populations thinks that the global climate change is a major threat.
There was the Tesla electric motor. It has become a household name now. We are moving to a new era of clean, green energy. Renewable power generation additions will increase. Passenger electric vehicle sales will rise 3 percent soon. Li-ion battery demand will increase in the next decade.
Europe’s housing stock is in need for efficiency. ACs will be a significant efficiency opportunity. Sector electrifications will improve hard-to-use segments. Efficiency gains and natural gas are powering China. Hydrogen will be a multi-decade growth sector. Rising petrochemical demand is also an opportunity for recycling.
Focus on hydrogen
Thomas Bohner, CEO, Mitsubishi Power Europe GmbH, added that this year has been difficult. The impact of Covid-19 is yet to be fully understood. The share of renewable energy has been increasing. Hydrogen availability is also very important.
As the International Energy Agency has said, there is momentum building. We are pushing for carbon capture technology. We are testing CO2 capture for marine. We did some studies. On waste heat recovery, there should be five years for profitability.
The energy prices are changing. The biggest opportunities are in converting to hydrogen. There are fuels that can go into chemicals. All gas turbines remain great assets. They are also hydrogen ready. Hydrogen is a clean energy source that does not emit CO2 upon combustion.
The accelerated introduction of IT, continued economic development in emerging nations, and a forecast for increased demand, plus reliable technology for control of the highly flammable element, make hydrogen power generation—clean and abundant—a viable alternative.
Delivering green recovery
There was a a panel discussion on delivering green recovery: What will it take to build back better?
Ms. Nancy Saich, Chief Climate Change Expert, EIB, said that we have remained focused on our goals. We are facing a critical decade. We need to try and solve the problems. In a green recovery, we need to address a lot of what will solve the issues. You also need private finance. We are also working on taxonomy, etc. We have set up a target by 2025. It is a signal to other players. We will also be making sure we will be funding many other objectives. We will be publishing our climate roadmap soon.
Ms. Laurence Tubiana, CEO, European Climate Foundation added that it was worrying to see so much turmoil. There was delay in moving to green transition. It was better to encourage the green transition. China has vowed to go carbon neutral by 2060. The support of the European citizens has seen a push for green recovery.
Paddy Padmanathan, President and CEO, ACWA, said that they had to quickly re-organize due to Covid-19. There was an enormous amount of convergence on what we need to do. We need to come up with carbon neutrality, and resilience of resources, etc. This requires decisive action.
Adair Turner, Chair, Energy Transitions Commission noted that we need to decarbonize the electricity system by 2035-40. We should also decarbonize some parts of our economies. There may also be a role for hydrogen, such as synthetic fuels, etc. We need to think about deep decarbonization, electrification, and hydrogen.
The EU’s focus is on green hydrogen. There is need for hydrogen electrolysis. It will make hydrogen an economic policy. On electrification, there is support program for the automotive industry. The subsidies for new cars are electricity focused. New sales of internal combustion engines (ICE) should be prohibited. Electrification of our economies are so deep. We need to electrify the economies.
The BNEF London 2020 Summit continues tomorrow.
NextFuel to intro world’s first CO2 negative fuel at UN Climate Summit
NextFuel AB, of Stockholm, Sweden, will introduce the world’s first CO2 negative fuel at the UN Climate Summit, on December 12, in Katowice, Poland.
An estimated 20,000 people from 190 countries will take part in the event, including politicians, representatives of non-governmental organizations, the scientific community and business sector. NextFuel has been invited by the Austrian Government that has the presidency of the EU Council. The UN event runs Dec. 3-14.
NextFuel’s completely new energy solution to climate change is CO2 negative, cheap, profitable and massively scalable. Its CO2 negative fuel briquette, made from elephant grass, is cheaper than oil and cheaper than coal in most markets. A coal plant can, without any investments, directly replace some or all of its coal with this clean alternative.
The technology has been tested and proven. NextFuel has the first operational plant in Austria. It is currently implementing the first large projects in East-Africa and South America. NextFuel was recently chosen as a best practice project by Arnold Schwarzenegger’s R20 Austrian World Summit.
Briquette replaces coal directly in coal plant
So, what’s this new CO2 – negative energy source, as an alternative to coal and oil?
Audun Sommerli Time, chief marketing officer (CMO), said: “We produce a clean copy of fossil fuels made of elephant grass in less than 30 minutes, that we call NextFuel. Elephant grass grows up to 4 meters in less than 100 days.
“When we turn this into fuel, we get NextFuel briquette that can even replace coal directly in a coal plant, but at the same time, have a carbon cycle for only a few months and also stores some the CO2 in the ground, making our whole process CO2 negative on a one-year basis. Not a carbon cycle of millions of years, like coal, or decades like wood pellets.”
Unique NextFuel torrefaction process
NextFuel has an unique torrefaction reactor that is used to produce this CO2 negative copy of fossil fuels.
Audun said: “The unique NextFuel torrefaction process is as follows when we transform grass to a clean copy of fossil fuels. We start by planting energy crops like elephant grass on cheap marginal land, not suitable for food production, and there is plenty of that all around the world. Elephant grass plant grows up to 4 meters in 100 days giving us several crops to harvest each year. It also stores so much CO2 below ground when the grass is growing, that our entire process becomes CO2 negative in a matter of months. After the elephant grass is harvested, it is chopped up and dried on belt driers. At this point the moisture content is no more than 5 percent.
“During the next step, the grass is fed into our patented NextFuel reactor. This is a rotary drum, indirectly heated and operated with low oxygen atmosphere. While inside that drum, volatile elements are separated from the grass, and the physical properties together with the energy content are transformed in less than 30 minutes in such a way that we call our fuel a clean copy of fossil fuel.
“The reactor also drives out the off-gases from the grass. They are used as surplus energy to produce heat or electricity to power the facility. After the reactor is finished, the fuel is densified and turned into briquettes that we cool on a cooling line. These briquettes are called NextFuel and are ready to use directly as a CO2 negative fossil fuel substitute, both in the industry and for electricity production.”
When you say oil, does it have the capacity to run cars, ships, etc.?
He said: ““Not in cars yet, since it is not liquid, but, it can replace heating oil in most industries, and produce clean electricity, thereby making it possible for electric cars to faster impact the transportation sector. The key use for NextFuel is to replace coal in coal plants, cement plant and steel plants or heating oil in different industries. NextFuel can also replace charcoal, and might, in the future, be used in ships able to utilize the steam.”
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