Green Tariff Policy

Source- Live Mint

Syllabus – GS 2 –  Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

Synopsis- The green tariff policy will enable DISCOMs to supply clean electricity to consumer.

Introduction-

• India is working on a green tariff policy and soon launches guidelines enabling power distribution companies to supply only clean electricity to customers at a green tariff.
• Green tariff policy-
  • The Green Tariff Policy will assist DISCOMs in providing electricity generated from clean energy projects at a lower cost as compared to power from conventional fuel sources such as coal.
• The policy comes as solar and wind power rates in India have reached all-time lows of $1.99 per unit and $2.43 per unit, respectively.

India’s ultimate goal

• India aims to achieve 175 GW of renewable capacity, including 100GW of solar power, by 2022.
• According to the Central Electricity Authority, by 2030, India’s power requirement would touch 817GW, more than half of which would be clean energy.

Advantage of green tariff policy-

• Supply cheaper renewable energy-
  • Once the mechanism is in place, discoms can exclusively buy green electricity and supply it at ‘green tariff’, which will be the weighted average tariff of green energy that the consumer will pay.
  • Open access will allow large users of energy, generally those who consume more than 1MW, to purchase power from the open market rather than relying on a more expensive grid.
• Ensuring open access will also encourage major green electricity users to build their own green energy facilities.

How India intends to address the issue of intermittent solar and wind energy supply.

The Union Power Ministry will shortly issue a strategy to encourage hydro pump storage schemes, with a potential capacity of about 96 GW.

• The plan is to elevate water to a certain height during off-peak hours and then discharge it into a lower reservoir to produce energy.