India and Germany are strengthening their ties by increasing their cooperation to address the issue of energy security and energy efficiency. Dr Nikolaus Supersberger, Deputy Director, Indo-German Energy Programme (IGEN), Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH speaks to Richa Kapoor (journalist from Energy Next, the leading Indian magazine on renewable energy), about Germany providing technical and financial support to India to make grid management more efficient and to help build a 'green energy corridor'.
Dr. Nikolaus Supersberger: The contribution of Germany has to be seen in different contexts. There is financial cooperation, which is done by "Kreditanstalt für Wiederaufbau" (KfW), and there is technical assistance, which is provided by the "Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH". It was last year that the German government decided to provide India with concessional loans worth up to Euro 1 billion and it will be channelled through KfW.
Apart from the financial cooperation, technical cooperation will be provided by GIZ and this will be financed by the Federal Ministry for Economic Cooperation and Development and by German Federal Ministry for Environment (BMUB). These projects, on which GIZ is currently working, are - among other issues - aimed towards the "Green Energy Corridors" approach of the Indian Government.
A recent workshop that was conducted by the Indo-German Energy Forum (IGEF) was a relevant step towards strengthening technical cooperation for Green Energy Corridors and it brought to the fore some of the most important issues, namely forecasting, scheduling and balancing.
The technical cooperation between the two nations will work towards addressing these issues, but it even goes further. Forecasting, scheduling and balancing are only the first challenges when it comes to the technical integration of renewables into the growing electricity grids in the country.
Our cooperation also takes into account the market aspects such as new market features or market reforms. This is owed to the necessity to integrate electricity generated from intermittent renewables into the grids at lowest possible costs. There will be ancillary services like transmission grid related services which can also include grid management. When we look at Europe, there was privatisation and liberalisation going on in the end of the Nineties, which meant that there was unbundling of generation, transmission and distribution of electricity taking place.
We would not suggest India to move into this direction currently, because this needs very thorough analysis. What I want to say is that for the Indian stakeholders it is important to look into various market designs and see which one is the most favourable to reach the goals which it has set for itself. The major goals here are the integration of renewables into the grid and to increase energy security. Taking over solutions 1:1 from other countries would not be the favourable thing to do. India needs to find out itself what the most appropriate way can be.
So, it is difficult to transfer the European example point to point to India as there are a lot of differences, for example electricity demands in Europe are more or less saturated. However, in India the situation is different as there are many who do not have power, while the people consuming power already are increasing their consumption. So in Europe more and more renewables are coming into the system which leads e.g. in Germany to a conflict between renewables generation and fossil generation, leading to a surplus.
In that sense GIZ wants to work closely with Indian stakeholders of the electricity grids with regards to techniques and requirements. Also the Renewable Energy Management Centres (REMCs) will play an important role in our work.
Dr. Supersberger: In general, there is no national ownership of technologies. Germany is in some technologies a world leader. When it comes to wind, it is Denmark which had played a front running role and Germany took up on the wind technology quite well in terms of industry development. When it comes to photovoltaic, Germany has been performing quite well. All these technologies are quite relevant to India, no matter from which country it comes from. India's target should be to build on energy security as well as build on the production of renewable technologies itself. This has already happened in the wind sector. Germany is willing to cooperate as well and this is expressed by the government support. From a personal point of view I am of course happy to see German technologies here in the country I chose to live with my family currently.
Dr. Supersberger: In general there are two dimensions of energy security. First is the international dimension when it comes to import dependency for example of coal. The second dimension is with regards to the contribution of the renewables to energy supply security domestically. The international aspect of energy security recently in India is for example about coal, because India has to import different qualities of coal. This is posing problems for the operation of the power plants as different quality of coal requires operational adjustments.
Renewables can play a very important role in bringing about energy security because it means that you are able to produce the energy which you need domestically. The discussion in India also focuses on energy security and the Scenario 2047 approach is all about the same. Hence the renewables can contribute a lot. There is need to harvest solar and wind, energy intermittent sources, whenever they are available.
Dr. Supersberger: Renewables are not far from grid parity. In Europe, renewables have already reached grid parity in very many cases. It always depends on the comparison baseline. If we take the example of off-grid in India, we see that the renewables are less expensive as compared to diesel generators. In general, taking the case of grid connected power, one also needs to take into account the external costs which are not included in the electricity generation. For example all damages done regarding health due to emissions from power plants, the environmental costs due to degradation of soil and water, sometimes subsidies given to the power generated from fossil fuels and so on. We need to make proper assessment on these external costs and find out what is more expensive. Renewables are not so expensive when we talk about real costs.
Dr. Supersberger: Nuclear contributes about 2 per cent to the overall power generated in India. India faces the problem of fuel supply for nuclear power plants and it can only get it from abroad. It would not change the situation of being dependent on the import of energy -- in this respect nuclear fuel.
Dr. Supersberger: There has been a lot of work done in forecasting and it became a big business especially because renewables are contributing in a significant manner to overall energy supply. In the absence of good forecasting, we face the problem of inaccuracy, leading to economic losses and the like. This triggered the technological progress in forecasting. Hence, success can be achieved sustainably only if the forecasting is done in an accurate manner. There are logistical and technological solutions to tackle this.
Dr. Supersberger: GIZ is working for more than a decade in the field of energy efficiency and Germany ventured in this sphere before it did in the renewables. Energy Efficiency potential is huge in India in all economic sectors such as buildings, electrical appliances. The industrial processes in India are not so efficient as compared to international standards. This can be a strong motivation for India to execute energy efficiency measures more vigorously. The point is why you should generate expensive electricity when you don't use it efficiently? Renewables should be backed with Energy Efficiency. GIZ is communicating closely with Bureau of Energy Efficiency on such issues like the Perform Achieve Trade (PAT) scheme which requires energy savings for 478 companies, while KfW is working in the field of energy efficient buildings.