Lights On briefing: Floating solar, gas tax squabbles and more
What you need to know to start the week
Happy Monday and welcome to today’s Lights On, a newsletter that brings you the key stories and exclusive intel on energy and climate change in South Asia.
In case you missed this weekend’s interview, take a look at my conversation with Vijay Sakhuja, a pioneer of polar studies in India, where we dissect India’s upcoming Arctic policy and ask what a tropical country has to offer to the most threatened frozen region of the planet.
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Image Credit - Snappygoat
Beyond solar and coal
A 450km natural gas pipeline connecting the states of Karnataka and Kerala was inaugurated by Prime Minister Narendra Modi last week, part of a strategy that will double the share of natural gas in India’s energy basket, delivered through a pipeline network joining up the entire country.
The idea is that increasing the share of natural gas will help replace more polluting coal over time. Modi stressed the need to have an ‘integrated approach to energy planning’, meaning that while the government will keep investing in clean energy, it won’t shy away from deploying as much fossil fuels as needed to meet the needs of the country.
World’s biggest floating solar plant
After India inaugurated the world’s largest renewable plant in Gujarat, the country is ready to break another global record, with the biggest floating solar plant in the state of Madhya Pradesh. A dam reservoir will host 600MW worth of solar panels, and is expected to be in operation between 2022 and 2023. The project will cost the equivalent of $408.7 million and will surpass the record currently held by a 150MW plant in China, inaugurated in 2017.
The battle for oil revenues
The new kerfuffle between central government and states involves petroleum products, which so far have been a key source of tax revenues for local governments. Now the Centre wants to include natural gas and eventually other petroleum based fuels under the common goods and services tax (GST), which taxes sales of products across India uniformly and thereby eliminates bottlenecks and disparities between states. Industry leaders and tax specialists think this is a good move, although in the short term it will deplete the states’ coffers. “Fuel prices will come down drastically, because they will be charged with only GST while at the moment each litre pays state level duties plus central government duties,” explains KS Prabhakar, founder of the Bengaluru-based consultancy Shree Tax Chambers.
No more solar in AP until books are in order
A 6.4GW ultra mega solar project planned in Andhra Pradesh has come to a grinding halt after a private developer spoke up about the state’s bad management of previous projects. Tata Power Renewable Energy filed a case against Andhra Pradesh, which had previously tried to retroactively renegotiate solar contracts already awarded to developers. It had unilaterally declared it would pay 2.44 rupees per kWh to existing plants despite having agreed to tariffs up to 5 rupees.
The state’s High Court sided with the petitioner and halted the project. A new hearing is scheduled for February 15.
Cities in the dark
A massive power outage on January 9 left most of Pakistan in the dark for more than 24 hours, with power being slowly restored from yesterday.
A fault at the Guddu power plant near the eastern border caused the country-wide failure spreading to all other power houses and grids. Islamabad, Lahore and Karachi were among the cities impacted.
According to local reports, the power minister attributed the incident to the country’s out of date transmission system and is now investigating the cause of the blackout.
Energy development gets a boost
Indian companies are investing a total of $9 billion in energy projects to aid industrial development in Bangladesh, with a focus on power production and cross-border connectivity. Energy giants Reliance and Adani groups, as well as government owned NTPC, have signed a number of agreements for projects in various parts of the country.
Among the deals planned is a $3.15 billion, three-nation connectivity initiative between India, Bangladesh and Nepal. India is particularly interested in regional cooperation as a way of improving energy security and counteracting China’s influence.
Air pollution crisis in Kathmandu
The capital’s air has reached hazardous levels, with combined air quality readings reaching levels ten times higher than the safe threshold set by the WHO. While experts say that last week’s exceptionally bad air stood out because it was visible, caused by a mix of open fires, brick kilns and vehicular emissions, the problem is present all year round.
Hydropower’s positive byproducts
One of the poorest areas of the country will soon reap the benefits of a $1 billion hydropower project whose construction started this week. The project, located in the Kalikot district, will have a capacity of 480MW. According to the Kathmandu Post, it will be a ‘game changer’ for the province with the lowest Human Development Index in the country, creating jobs and boosting the business ecosystem of the area.
On Twitter this week
James Cheshire @spatialanalysis
Before/after satellite images of last night's huge power cut in Pakistan bbc.co.uk/news/world-asi…
January 10th 2021
10 Retweets38 Likes
Research and further readings
- Analysis: Electric vehicles could help fight India’s pollution crisis – but the lack of bank loans is a hurdle - Last year the coronavirus crisis reminded us that pollution kills: almost 27 percent of Covid-19 cases in East Asia are a result of long-term exposure to polluted air. But it also showed that reducing air pollution by targeting specific sources is possible. In cities like Delhi, electric vehicles are a promising solution, and with the right financial support from the government they could become affordable for enough citizens to make a difference in the air quality of the world’s most polluted capital.
- Long Read: Safe water costs 40 times more in coastal Bangladesh than cities - In coastal Bangladesh, sea level rise and the consequent intrusion of saline water means that access to drinking water is declining, leaving citizens poorer. This long read has the data and hears the voices from the ground.
- Report: India could compete against China in solar module production with the right government support - While India is performing well in solar module production, it still lags behind China, according to a new report by the Institute for Energy Economics and Financial Analysis (IEEFA). This is a problem as the country tries to wean itself off its dependence on Chinese imports while aiming at reaching 450GW of renewable capacity by 2030. The report shows how India can do better, if the government is serious about its solar targets.
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