According to an excellent summary on the blog Green Inc., one encouraging factor is where the money will come from: Increased taxes on gasoline and diesel fuel (both currently subsidized). To stimulate demand for the new solar output, on the other hand, feed-in tariffs and purchasing obligations for power authorities are also in the plan.

Predictably, another central factor in the plan is India’s plan to build up its manufacturing capacity for photovoltaic (PV) cells and modules. This anachronistic “do it yourself” attitude in a world dominated by trade is at first glance a bit disappointing; 21st Century Power has bemoaned in past posts the massive waste of potential synergies between neighboring China (which has massive excess PV manufacturing capacity) and India in the area of solar power. However, one bright spot in this plan is that India doesn’t plan to do it all by itself: The plan also calls for reduced tariffs on imported equipment.

A few comments:

- All the intentions declared here are excellent, but the key will be in execution. In the areas of green energy and environmental policy, the Indian state has many chefs in the kitchen, creating risks of poor ownership and accountability for results. Unless a single person or body is empowered to manage it and maintain a high degree of discipline over time, such a huge and ambitious program may falter or lose momentum too soon. Someone must have the authority to get the MNRE, IREDA, the Ministry of Power, MEF, the Ministry of Science and Technology as well as all finance departments in line and working together, for example.

- At this point, it’s not clear whether the National Solar Mission will also mandate a Smart Grid. The country’s delapidated transmission network isn’t really adapted for distributed generation, so without investment to modernize the power grid, talk of feed-in tariffs and purchasing obligations may be empty. (See past posts on this topic here.)

- It’s also not clear to what degree the Plan commits India to distributed generation. The draft reportedly envisages solar farms on the undeveloped “safety buffer” land surrounding nuclear plants and a multitude rooftop solar farms averaging 3 kilowatts in scale. This may be missing an important opportunity for rural off-grid micro generation in a country where, according to a newly published paper by the global PV industry association, SEMI PV Group, a whopping 450 million people still rely on (largely imported) kerosene for their domestic lighting needs. The paper, quoted here by the blog Solar Feeds, points to Indian case studies showing that Solar Home Systems that provide for all lighting needs can pay for themselves within 5 years, given sufficient microcredit to cover the up-front costs of just USD285 per home.

- Finally, given the history of competition and one-upmanship between India and China, 21CP wouldn’t be surprised to see Beijing likewise unveil a big plan for solar and/or other renewables in the months ahead. China won’t be keen to be upstaged.

Even if the two Asian giants aren’t working collaboratively, what’s clear is that strong initiatives like these on shifting to renewable energy sources will give them additional negotiating leverage in the upcoming December round of negotiations on global climate change. Western industrialized nations may not succeed in getting New Delhi and Beijing to agree to reduce greenhouse gas emissions as quickly as they’d like, but muscular efforts to switch to renewables could certainly reinforce the latter’s case.

(Image courtesy of Greenpeace)

Notably, Mr. Saran seems eager to reject the notion that India is unworried about global warming as it focuses single-mindedly on economic growth.

“We are the ones who are going to be most impacted by climate change. Our margin of safety is very narrow. The perception that somehow developing countries like India are not interested in climate change is a complete distortion. We are perhaps much more interested than others are.”

He also said that India had already started to decouple emissions from economic growth (4 percent increase in emissions with an 8 to 9 percent growth in economy over the last ten years), acknowledging however that much more needs to be done in this area.

(File image of Mr. Saran courtesy of www.terradaily.org)

The report was framed not so much to praise China but to point out that (shock, horror!), in the high-tech war against climate change, the U.S. has fallen behind a much poorer country widely perceived as less sophisticated and more “dirty” environmentally. Shame, shame.

Fair point, but a few comments are needed to put this fine piece of reporting from correspondent Keith Bradsher into perspective:

(1) People are building power plants in China willy-nilly …

They have no choice — the country is in a losing battle with runaway growth in electricity demand from the consumer and industrial sectors. Thus, opportunities to experiment with new techniques (like the hotter-steam, higher-efficiency plants mentioned) are abundant. Sure, any aggressiveness in this area is good to see, but a little dabbling here and there with new ideas shouldn’t be such a tremendous surprise.

(2) It’s a big leap of logic to assume all new Chinese plants constructed will be the cleaner types … at least right now.

Decisionmaking about power generation infrastructure is highly distributed and subject to local interests that aren’t necessarily so enlightened. The common American view of China as a beehive that operates in lockstep with the directives of a central bureaucracy in Beijing is a fallacy. In my opinion, this article is a bit thin on evidence that cleaner techniques will account for even a majority of new construction … The anecdotal examples cited (notably the Tianjin plant) could turn out to be highly touted exceptions, rather than the rule.

(3) The preponderance of China’s coal-fired power generation is dirty today … and that won’t change overnight.

Even if we took the most optimistic scenario (cleaner plants accounting for 100% of new coal-fired capacity built going forward), the country will still be among the biggest producers of greenhouse gases for decades to come. I am especially skeptical about one of the statements in the article: “China has begun requiring power companies to retire an older, more polluting power plant for each new one they build.” As noted above, in the face of skyrocketing demand, the country is fighting hard to install generation capacity fast enough to avoid brown-outs. Under these circumstances, you are trying to keep aggregate capacity growing as fast as possible — and retiring older plants is a luxury the country can ill afford.

One final little gripe … The Times report also singles out the experimental sequestration plant outside Beijing, but as highlighted in this blog in February, visitors noted that the plant’s design principle is practically impossible to scale — it would produce far more carbon gas than could ever be consumed by the carbonated beverage industry.

Nevertheless, a very interesting read!

(Image by Doug Kanter courtesy of the New York Times)

As noted in this blog previously, clean coal remains attractive as a concept — especially in energy-poor, coal-rich countries like China and India — despite skepticism about its feasibility .

The Reality campaign is using a variety of channels including humorous — and more than a little biting — television ads, YouTube videos, and Web banner ads to deliver its message, cleverly branding itself with a yellow canary. (Caged canaries were used in coal mines traditionally as an early warning system against excessive buildups of deadly coal gas. The little birds would drop dead long before human miners could detect the gas’s presence.)

Check out the Website or the Blog.

Few seem to be taking note of Beijing’s obvious motive: addressing the massive overcapacity problem of the country’s overgrown PV solar industry. As noted in previous posts, China’s PV cell manufacturing sector was built up to address export markets in the West, which have dried up due to the global economic crisis. This latest policy move is an attempt to ease the pain by stimulating domestic consumption as a substitute. In effect, Beijing is saying: Invest in solar generation facilities, not production of solar components.

On a related note, the following article from Renewable Energy World makes a number of good arguments why U.S. solar equipment vendors should target India’s electricity-starved market.

As a reader, I walked away asking myself: Why shouldn’t China also view the market on the other side of its border as an opportunity to solve its overcapacity problem? Why not subsidize exports to India as well? Or better yet, sit down with New Delhi to negotiate mutually beneficial trade terms that would make the Indian market more palatable to Chinese PV cell makers, while at the same time helping stimulate a durable growth market right next door? By the same token as they’re being asked to get to work in China, Chinese engineering firms could jump to address unmet energy needs in India as well, no?

(image courtesy of economatters.files.wordpress.com)

The logic goes like this: A cap-and-trade system ultimately attaches a high costs to polluting beyond a certain defined limit (the “cap”), raising costs for industries that either consume a lot of power or create a lot of pollution or both. As a result, it will: (a) make U.S. firms less competitive than counterparts in countries where one can pollute for free, and (b) encourage U.S. firms to relocate production to such countries to get around the problem.

The resulting exportation of pollution wouldn’t help the global warming problem at all, and indeed, it’d put the Obama administration in hot water with voters for driving more U.S. jobs overseas. So … the administration is already signaling it’d seek to plug that hole by imposing tariffs. “If other countries don’t impose a cost on carbon, then we will be at a disadvantage … [and] we would look at considering perhaps duties that would offset that cost,” the blog quoted Energy Secretary Steven Chu as telling a Congressional panel on Tuesday.

This would likely become the first shot in a trade war, with China retaliating with sanctions of its own, the U.S. responding, and so on and so forth … Not a scenario that leads to happy endings in an interdependent global economy that’s already under considerable pressure. Trade relations with India would probably go down a similar path quickly, should anyone seek to relocate their pollution there (although Western companies have traditionally focused heavy-industry investment in China, looking to India for software and services).

As noted in this blog previously, China and India have almost identical official positions on climate change: i.e. that industrialized Western nations bear the bulk of responsibility, having emitted the bulk of greenhouse gases that has accumulated over decades in the atmosphere. Both also argue that their per-capita emissions remain much lower than those of wealthy countries even today.

Thus, they’re unlikely to either knuckle under to trade pressures to adopt cap-and-trade regimes themselves, or to accept related tariffs. It’s not a philosophical issue, but one of self interest: Both countries are much more highly dependent on coal for energy than industrialized counterparts, so they would be extremely uncompetitive places to locate businesses whose cost structure is — directly or indirectly — tied to carbon emissions.

Watch this space closely.

Though it’s a US-centric discussion, I heard a number of things that struck me as globally important. The US mobilizing a huge amount of money on this topic, sure, but the knock-on effect of that is that some of the business world’s most biggest technology and innovation companies are suddenly, shall we say, very motivated. Also, upcoming experiments with policy in the US (implementation, creating incentives) may well provide learnings worth observing.

Key take-aways for me:

(1) The Obama Administration’s recently passed stimulus package contains roughly $11B earmarked for smart grid improvements to the national infrastructure, but Prof. Kammen described this as just a “down payment” on a transformation that will eventually cost an estimated $200 and $400B (or more!) to fully realize.

(2) The term “smart grid” really means different things to different people - people agree on what it would enable, e.g. greater energy efficiency, distributed generation via renewables, more secure & stable supplies etc. (see previous posts on this). However, the technical means to be used are debatable … and not all have been invented yet. There is a scramble by IT giants like IBM, Google, Cisco and Microsoft to enter this suddenly ballooning market, but existing silicon and software readapted for this new purpose will only get us part of the way there, according to Prof. Kammen.

(3) Although the federal (national) government is leading the charge in the US, smart grid implementation needs to begin at the local level first, Mr. Yeager says. Practically speaking, smart grid won’t provide much practical benefit otherwise.

(4) State regulatory regimes today actually disincentivize power companies to adopt smart grid, because they reward them economically for maximizing production — not efficiency. Prof. Kammen called, for example, for pricing regulations where power companies make their production forecasts in advance, obtaining higher prices per kWh if they undershoot the forecast, and lower prices if they overshoot. Interesting.

The last two issues call for central governments to strong-arm potentially slower moving state/provincial ones, something that might not be a challenge for Beijing, perhaps, but could be a big headache for New Delhi.

(US Department of Energy map courtesy of Science Friday)

This is not that type of blog. However, I’m making an exception today because what GE is doing here in terms of innovative ways to market Smart Grid is, well … kind of cool.

Click here to (in GE’s words) “see a digital hologram of Smart Grid technology come to life in your hands.” (Disclaimer: You need a PC with Webcam attached to make it work, and there is the small annoyance of having to print out a page they provide.) Sure, it’s propaganda, but it’s futuristic propaganda!

If you’re feeling too lazy for all this, you can get a preview of what the experience is like by watching this 28-second YouTube video clip instead.

This is just a feature inside an umbrella GE site on Smart Grid. If you want to skip the augmented reality demo and go directly there, click here.

The last post focused on a proof of concept in China. (Hopefully the testing is yielding usable data and not just good P.R.) Today, I just wanted to share some nuggets on recent activity across the Himalaya in neighboring India.

Fresh in the news are plans for an unspecified Indo-French tie-up in clean coal. According to this brief report in the Hindu, the Minister of State for Power is talking up plans to leverage French company Alstom in clean coal the way India is working with France’s Areva in nuclear. Although some sort of agreement was hinted, the report gave disappointingly few details.

But also in recent months, US-based EnergyQuest announced that it had been tapped to provide coal-gasification technology for two plants just east of Mumbai with total generation capacity of 1,200 megawatts. (Details in this article from greentechmedia.) EnergyQuest’s CEO is quoted as saying the gasification process increases the efficiency of coal use by 30% and removes as much as 20% of the carbon that would normally end up flowing out of the plant smokestack into the atmosphere — but there’s a catch. Even he admits no proven means exists at present to store the captured carbon, with underground sequestration remaining only a “theoretical” option.

Sound familiar?

There is a fierce debate about the merits of so-called “clean coal” technologies raging worldwide, and the stakes are especially high for China and India. As we’ve noted in this blog (statistics here), both share a severe dependency on coal that’s widely expected to worsen in the decades ahead, as supplies of imported oil become unaffordable or difficult to secure. This is painful, because although both have fast-rising energy needs and abundant domestic coal resources, burning coal has a notorious impact on quality of life (air pollution, acid rain) and on global warming.

Thus the allure of new “clean coal” technology, which promises to bring all the benefits of an existing industry while transforming it into something green. Too good to be true? Critics like Mr. Blakeslee think so, but you have to recognize that they have an axe to grind: most of them are supporters of renewable technologies competing for government support. In their view, clean coal is nothing more than an expensive mirage, while more reliable technologies for solving the sustainable energy problem aren’t getting the funding they need.

The strongest advocates of clean coal technology, not surprisingly, are from the coal industry and coal-producing areas. The US Senate draft of President Obama’s pro-green economic stimulus legislation would allocate a whopping $3 billion for clean coal and carbon-capture & sequestration technology development (news report here), and Senator Robert Byrd of coal-rich West Virginia was behind these provisions. Mr. Obama himself often spoke about clean coal technology as a senator and presidential candidate (his home state of Illinois also having significant coal mining), but it remains to be seen whether his enthusiasm will persist as president. Outcomes in the US are meaningful for China and India, as the multibillion-dollar R&D programs (if succesful) would lead to technology and industrial scale that will be transferrable worldwide.

One thing’s for sure: No-matter how clean technical advances can make the coal-burning process or how good or bad the ROI involved, coal will remain a non-renewable fossil fuel.

(Image courtesy of ecoworld.com)