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[title] => KERC Draft 2024: Ancillary Services Regulations Overview for Karnataka's Grid Reliability and Efficiency
[content] =>
Brief Overview of the Draft Karnataka Electricity Regulatory Commission
(Ancillary Services) Regulations, 2024
Purpose and Scope
The draft regulations aim to establish a robust ancillary services framework
to ensure grid reliability, operational efficiency, and frequency stability
amidst growing renewable energy penetration and demand complexities. These
regulations apply to intra-state entities, including power generators,
transmission and distribution licensees, and entities with energy storage or
demand-response capabilities.
Key Features
-
Types of Ancillary Services:
-
Primary Reserve Ancillary Services (PRAS): Immediate response
via governor action to maintain frequency.
-
Secondary Reserve Ancillary Services (SRAS): Automated response
through AGC to manage grid stability.
-
Tertiary Reserve Ancillary Services (TRAS): Reserves activated
based on despatch instructions.
-
Any other ancillary services defined by the Karnataka Electricity Grid
Code (KEGC).
-
Operational Framework:
-
Eligibility: Generators and entities must have SCADA systems,
AGC capability, and a minimum response capacity of 1 MW.
-
Activation: Based on deviations from grid norms, calculated as
per the Area Control Error (ACE) formula.
-
Procurement: Nodal Agency (State Load Despatch Centre) will
handle procurement through day-ahead and real-time mechanisms.
-
Performance Monitoring:
-
Providers must adhere to control signals and performance will be
evaluated against set benchmarks.
- Non-performance can result in disqualification or penalties.
-
Payment & Settlement:
-
Payments are based on energy or compensation charges, with no
retrospective adjustments.
-
SRAS providers are directly compensated by the State Deviation
Settlement Mechanism Account (SDSMA).
-
Transparency & Accountability:
-
Regular publication of operational data and feedback reports by the
Nodal Agency.
-
Stakeholder involvement through consultations during the detailed
procedural development phase.
Implications for Stakeholders
The regulations aim to foster a competitive market for ancillary services
while encouraging innovation in grid management. They emphasize transparency
and accountability, ensuring a balanced approach to grid security and
economic viability.
-
Stakeholder Roles
-
Generators: Obligated to maintain operational readiness for
ancillary services and provide capacity as required. Implications
include increased operational transparency and adherence to control
signals.
-
Transmission Licensees: Must ensure infrastructure supports
ancillary service requirements and maintain robust communication with
nodal agencies.
-
Distribution Licensees: Need to align demand-side management
with ancillary service protocols, potentially incurring costs for
upgrades.
-
Nodal Agencies (SLDC): Central to planning, procuring, and
deploying ancillary services. Responsibilities intensify in real-time
management.
-
Open Access Consumers: Must comply with demand response
requirements, potentially impacting their operations.
-
General Implications
-
Operational: Increased reliance on real-time systems like SCADA
and AGC.
-
Financial: Changes in cost structures for ancillary service
providers and consumers.
-
Regulatory: Need for compliance with detailed procedures and
performance metrics.
[slug] => kerc-draft-2024-ancillary-services-regulations-karnataka-grid-reliability
[created_at] => 2025-01-03 10:30:39
[update_at] => 2025-01-13 10:30:39
[count] => 0
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[1] => stdClass Object
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[id] => 51
[user_id] => 4
[title] => Is Indian Hydrogen Market not fit for SME’s as Large Firms dominate?
[content] =>
Eninrac Insights on India’s Green Hydrogen Market:
It is indeed true that the initial excitement or buzz around green hydrogen business in India stands reduced with the initial enthusiasm from companies of all sizes entering India's green hydrogen sector has diminished, leading to a landscape increasingly dominated by large corporations. Although there are many contributing factors but some prominent one’s are enlisted as below:
1. High Capital Expenditure and Technological Barriers:
The production of green hydrogen requires substantial investments in advanced technologies like electrolysers. These high capital expenditures pose significant challenges for small and medium-sized enterprises (SMEs). For instance, the India Green Hydrogen Market is projected to be worth $8 billion by 2030 and $340 billion by 2050, indicating substantial investments primarily from major players.
2. Economies of Scale Favoring Large Corporations:
Large corporations benefit from economies of scale, enabling them to distribute high initial costs over extensive operations, thereby reducing the per-unit cost of green hydrogen production. Companies like Reliance Industries and Adani Group have announced significant investments in green hydrogen, leveraging their scale to achieve cost efficiencies. For example, Reliance Industries invested $10 billion to generate 100 GW of solar electricity from renewable sources to produce green hydrogen by 2025.
Factsheet-India’s Green Hydrogen Development Roadmap
Source: eninrac consulting
3. Infrastructure and Supply Chain Challenges:
Developing a robust infrastructure for the production, storage, and distribution of green hydrogen demands significant investment, which is more accessible to large corporations. Challenges such as land allocation issues, high investment burdens, connectivity problems, and delays in government clearances have deterred smaller companies from participating in green hydrogen tenders.
4. Net Worth Criterion for Players Participating in RfS for SECI Bids:
The Request for Selection (RFS) mandates a minimum net worth of ₹10 million per MW (approximately USD 120,000) and a performance bank guarantee of ₹1.48 million per MW (around USD 18,048). With a minimum bid capacity set at 100 MW under Bucket 1, bidders are required to demonstrate a net worth of ₹1 billion (USD 12 million) and provide a performance bank guarantee of ₹148 million (USD 1.8 million).
These stringent financial requirements create significant barriers for micro, small, and medium enterprises (MSMEs), as their investment in plant and machinery is capped at ₹500 million (USD 6 million). This effectively excludes many manufacturing businesses and start-ups from entering the electrolyzer manufacturing sector. Furthermore, the substantial financial burden of the bank guarantee requirement poses an additional challenge for entities without established credit lines, making it even more difficult for them to participate in the bidding process.
5. Access to Financing:
Large corporations often have better access to financing options, enabling them to undertake significant projects in the green hydrogen sector. For example, Adani New Industries invested $50 billion in green hydrogen in collaboration with TotalEnergies to create the world’s largest green hydrogen ecosystem.
6. Technological Advancements and Expertise
The development and deployment of green hydrogen technologies require advanced expertise and research capabilities. Large corporations typically have dedicated research and development departments, allowing them to innovate and stay ahead in the sector. For instance, companies like Siemens and Thyssenkrupp are investing in research and development to expand their product lines in the green hydrogen market.
7. Market Dynamics and Competitive Pressures
The competitive landscape of the green hydrogen sector favors entities that can operate at scale and absorb market fluctuations. Large corporations can leverage their diversified portfolios to mitigate risks associated with the nascent green hydrogen market, a flexibility that smaller companies often lack.
Conclusion
The dominance of large players in India's green hydrogen sector is a multifaceted issue stemming from high capital requirements, economies of scale, infrastructure challenges, policy uncertainties, financing access, technological expertise, and market dynamics. Addressing these challenges requires targeted policy interventions, financial incentives, and support mechanisms to enable smaller companies to participate meaningfully in the green hydrogen economy.
[slug] => is-indian-hydrogen-market-not-fit-for-smes-as-large-firms-dominate
[created_at] => 2025-01-24 21:13:28
[update_at] => 2025-01-24 21:13:28
[count] => 0
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[type] => the-c-suite-intelligence
[status] => 1
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[2] => stdClass Object
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[id] => 70
[user_id] => 4
[title] => Electrifying Opportunities: Unlocking Investment Potential in South Africa’s EV Market
[content] =>
CURRENT EV LANDSCAPE IN SOUTH AFRICA
South Africa marks a sales of 1257 BEVs during 2024.
WILL A 150% TAX BREAK ATTRACT GLOBAL INVESTMENT INTO SOUTH AFRICA'S EV SECTOR ?
To boost the EV production in the country, the Government of South Africa announced that companies that invest in the production of electric vehicles (EVs) or hydrogen fuel cell vehicles in the country would be able to claim a 150% tax deduction on these investments, beginning in March 2026. The legislation that was signed into law on 3rd Jan 2025 forecasts to unlock roughly $ 27 Billion in new investment in the country’s EV sector. The Hon’ble Finance Ministry of South Africa also announced a budgetary support of $ 51 Million to electric vehicles adoption in the country over medium term. According to South African Automotive Business Council – in light of the tax break, China has already begun encouraging its EV manufacturers to invest in South Africa in a bid to strengthen ties between the two countries, with three Chinese automakers having signed non-disclosure agreements related to potential investments in the sector. Several Chinese EV brands have already made inroads into South Africa. BYD entered the market in 2023 and has introduced three models. Great Wall Motors (GWM) has launched electric and hybrid options under its Ora and Haval brands, while Chery plans to roll out new NEV models in 2025, complementing its existing portfolio of internal combustion engine (ICE) vehicles. Additionally, Dongfeng unveiled its fully electric Box model in South Africa at the end of 2024.
Despite these developments, EV adoption among South African consumers remains limited due to several challenges. A 25% import duty on EVs, compared to an 18% duty on ICE vehicles, makes EVs less competitive. An underdeveloped charging infrastructure network is another obstacle. And although scheduled power cuts have significantly decreased, the country’s history of load-shedding has raised concerns about the feasibility of using EVs.
EV Battery Materials Availability in South Africa
EV manufacturers use several different chemistries in batteries. Lithium iron phosphate (LFP), lithium nickel cobalt aluminium oxide (NCA), and nickel manganese cobalt oxide (NMC) are the three leading cathode chemistry types. Of the three, NMC is the most prevalent and the fastest growing for the EV industry. This is due to its high specific energy and low internal resistance. NMC cathodes currently account for about 28% of global EV sales, which is expected to grow to 53% by 2027.
The Southern Africa region is fortunate enough to possess various mineral ores, which can be useful in the local production of lithium-ion batteries.
The African Continental Free Trade Area (AfCFTA) and the SADC Programme on Climate Change Adaptation and Mitigation could thus aid in accessing these raw materials. AfCFTA, enacted in May 2019, is the largest free trade area in the world. It aims to create a single market for easy movement of capital and goods, eliminate tariffs, and create a customs union.
South Africa is an attractive manufacturing destination for lithium-ion batteries because of its existing battery manufacturing (and recycling) industry. Besides, South Africa’s mining sector can provide some of the raw materials required for the NMC cathode battery chemistry, especially manganese and cobalt. SA possess 78% of the world’s manganese. Moreover, other raw materials required in the cathode are mined in sub-Saharan Africa. The increasing global demand and prices for these minerals could provide a boost to South Africa and the region’s mining industries. Considering the safety challenges of transporting LIBs, manufacturing in SA also represents a strong entry point to the wider African market
Availability of Raw Materials in the Sub-Saharan Region for Lithium-ion Battery Production
Minerals & Metals
| Source Country |
| Nickel | South Africa (9th largest global producer) and Zimbabwe |
| Manganese | South Africa (70% of the world’s manganese reserves), DRC, Gabon, and Ghana |
| Cobalt | DRC (>60% of world supply, of which 85% is exported to China), and Zambia |
| Lithium | Zimbabwe (5th largest producing country), South Africa, and Namibia |
| Graphite | Mozambique (20-40% of global reserves), Tanzania, Zimbabwe, and Madagascar |
| Copper | South Africa, DRC, Namibia, Zambia, and Zimbabwe |
EV Battery Mineral Reserves in South Africa & Countries in Southern African Region
Driving Clean Mobility: Key Regulations and Policies Shaping South Africa's Green Future
Key initiatives by Government of South Africa to drive clean mobility
The South African Automotive Master Plan (SAAM) 2021-2035
The SAAM guides policy on growing and supporting the domestic automotive industry from 2020 to 2035. Developed by government and the automotive industry, the SAAM covers car and light commercial vehicle manufacturing, medium, heavy, extra-heavy truck, and bus production (potentially including off-highway vehicles), motorcycles, and the South African component supplier industry. Vehicle importers and distributors are also covered. This also includes incentives for investment into new technologies such as EVs and hybrids.
Green Transport Strategy (GTS) for South Africa – 2018 to 2050
To address the significant contribution of transport to national greenhouse gas (GHG) emissions, the Department of Transport (DoT) has developed a green transport strategy. The GTS, which is based on sustainable development principles, aims to minimize the impact of transport on the environment, and meet current and future transport demands. It promotes green mobility and is the first national government-led strategy that makes provision for sustainable transport. This included – (i) offer producers of EVs manufacturing incentives to both produce and sell affordable EVs in South Africa, for both the local and export markets, (ii) work with local research institutions to research EV batteries,(iii) assist in establishing & developing local EV OEMs, (iv) consider providing incentives related to the beneficiation of using local resources in the manufacturing of key machinery and/or components (e.g., hydrogen fuel cell electric vehicles)
[slug] => electrifying-opportunities-unlocking-investment-potential-in-south-africas-ev-market
[created_at] => 2025-02-11 12:01:54
[update_at] => 2025-02-11 12:01:54
[count] => 0
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[type] => the-c-suite-intelligence
[status] => 1
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