Environmental Engineering Reference
In-Depth Information
(IPI) pipeline. That has been stalled for quite
some time now due to pure geopolitical reasons.
Transnational pipelines are diffi cult and com-
plex ventures since they involve different coun-
tries with different economic and political
interests. It is well documented that the transna-
tional pipelines are diffi cult to execute as they
pass through diffi cult terrain and politically and
environmentally sensitive areas and hence require
mobilisation of huge fi nancial and technological
resources. It is highly desirable that India should
pursue transnational pipeline deals with gas
resource-rich countries in the region. This would
de-risk supply security to a greater extent and add
to development of a green economy.
With the current domestic gas supply and
imported LNG, over 50 Indian cities are getting
natural gas supply. Essentially consumers in
domestic, industrial and commercial segments are
getting piped natural gas (PNG), and the transport
sector is getting compressed natural gas (CNG).
Over 2.3 million domestic, 17,000 commercial and
5,000 industrial consumers (Table
11
) are using
natural gas in the country. The industrial customers
that are spread across industries like ceramics,
power, textile, steel, packaging, pharmaceutical,
petrochemical, refi nery and cement do prefer natu-
ral gas as fuel over other existing alternatives (Kar
and Sahu
2012
). Many states like Delhi, Gujarat
and Maharashtra (Table
12
) have taken a lead in
terms of CNG-driven transport system. States like
Delhi have got huge benefi ts like a drop in pollu-
tion level from CNG-driven transport system.
environment-conscious researchers argue in
favour of including all environmental and social
externalities for calculation pricing of fossil
fuel-based energy. Even without that in some
countries the renewables have achieved grid
parity with other available sources of nonrenew-
able energy. As reported by Paton (
2013
), elec-
tricity generated from new wind farms costs
about ~$80 ($84) for each megawatt per hour
(MWh) produced, while electricity from new
coal plants costs about $95/MWh and electricity
from new natural gas plants costs about $100/
MWh. The above prices are excluding of
Australia's carbon tax ($23.5 per tonne of car-
bon emissions); if included, it makes the real
market price of coal power about $146/MWh
and natural gas about $119/MWh (EESI
2013
).
In India, renewables have achieved parity with
electricity produced from diesel-based genera-
tors and gas (imported spot LNG)-based power
plants. However, renewables have a long way to
go to achieve grid parity with coal-fi red or
domestic gas-based power plants. Renewables
pricing in India is receiving much needed atten-
tion, and the government at the centre and at the
state level through their electricity commissions
is trying to ensure a level playing fi eld for the
renewable power producers. The power distri-
bution companies at the state level are required
to purchase a mandatory percentage of electric-
ity from renewable sources. Through this the
regulatory commissions are trying to ensure off-
taker of renewable power from the producers at
a fairly competitive price set by the regulators
(Table
13
). Such regulatory interventions are
not only desirable but necessary to promote
green energy. Regulatory enforcement could
change the market demand for renewables and
possibly help fasten adoption and early market
development. Large-scale production of renew-
ables would bring down the cost of production,
and effi cient grid integration could drive down
cost of transmission and distribution. In the long
run, effi cient production and transmission could
ensure higher return on investment and fi nally
attract more investment for renewables. This
could bring renewable price parity with existing
options for the fi nal consumer. In order for
7
Pricing of Renewable Energy
Pricing of renewable energy seems to be an
important issue in the context of renewable
energy production, distribution and consump-
tion. Of course, in many countries the renew-
ables have not achieved grid parity because of
higher cost of technology, lack of grid integra-
tion and other operational constraints. Energy
from nonrenewables or fossil fuel was found to
be comparatively cheaper, accessible and avail-
able. However, the pricing of fossil fuel doesn't
include the environmental externalities. Many
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