Interview with K.V.S. Baba

“Our focus on secure, economical and sustainable grid operations remains unchanged”

Power System Operation Corporation Limited (POSOCO) continues to play a crucial role in maintaining grid reliability and safety in the fast changing power landscape. In recent years, it has undertaken several measures such as an automatic generation control (AGC) pilot project, fast response ancillary services (FRAS) for hydro stations, security constrained economic despatch (SCED), and implementation of reserves regulation ancillary services (RRAS) to support the changing grid conditions. In addition, key initiatives like the National Open Access Registry and pan-Indian AGC implementation have been lined up for the future. K.V.S. Baba, CMD, POSOCO, shares his views on the state of the sector, the challenges in renewables’ integration, and POSOCO’s key achievements and focus areas…

What is your view on the state of the sector?

The power sector in India is undergoing unprecedented transformation in rate, scale and scope. However, the things that remain unchanged are the physics and POSOCO’s focus on fundamental obligations to provide secure, reliable, economical and, most importantly, sustainable grid operation and wholesale electricity markets. There are eight core disruptors that are changing the way the power system is operated: demand growth, supply sources, consumer behaviour, climate change, new business models, cybersecurity, ageing infrastructure, and the convergence of the electricity, transport and  energy sectors. Sustained economic growth continues to drive electricity demand. At the wholesale level, competition is being encouraged and fostered.

How did the grid perform in the past year?

The diversification of India’s generation mix continues to change the dynamics of the power system. The total installed capacity of power stations stood at around 360 GW as of July 2019. The target for generation from conventional sources for 2019-20 has been fixed at 1,330 BUs; this would mark a growth of 6.5 per cent over the generation of 1,249 BUs in 2018-19. The conventional generation during 2018-19 was 1,249 BUs as compared to 1,206 BUs during 2017-18, representing a growth of 3.5 per cent. In 2018-19, an aggregate capacity of 8.5 GW of renewables was added. Renewable energy generation witnessed a 25 per cent growth, increasing from 102 BUs during 2017-18 to 127 BUs during 2018-19. Wind and solar generation contributed close to 8 per cent of the annual electrical energy consumption during 2018-19. The instantaneous MW generation levels reached around 20 per cent on an all-India basis, going up to 50 per cent for the southern region and up to 90 per cent for states such as Karnataka. As per “Greening the Grid”, a report released by the Ministry of Power and USAID in 2017, the generation despatch simulated for the 100 GW solar-60 GW wind scenario in 2022 showed that the maximum renewable energy penetration would reach around 54 per cent of the load on an all-India basis. Wind and solar energy penetration is expected to go up to 35 per cent by 2029-30, with 80 per cent instantaneous penetration, as per the central electricity authority’s draft report, “Optimal Generation Capacity Mix” for 2029-30. During 2018-19, POSOCO responded to challenges in meeting the 182 GW demand with a focus on grid reliability and planning. We have been in the power sector for many years and are entering 2019-20 with the same confidence to challenge conventional thinking and practices and remain a step ahead.

What are the key challenges in integrating renewable energy into the grid? What is the way forward for addressing grid reliability issues?

The large-scale penetration of renewable energy and other distributed sources increases uncertainty and volatility in grid operations. Operational challenges include fast ramping, variability, potential grid instabilities resulting from loss of inertia, load stagnation/oversupply, inadequate communication interfaces and operator training. Reinforcement and expansion of the grid is needed to deal with the rise in power consumption and the integration of distributed energy sources. Several actions such as bringing flexibility in conventional generation, frequency control, maintaining generation reserves, the introduction of ancillary services, forecasting, scheduling, deviation settlement mechanism, balancing mechanism, robust data telemetry and communication systems, the establishment of renewable energy management centres (REMCs), transmission system strengthening,  and compliance with grid regulations and standards by renewable energy generators will be pivotal for the power sector over the next few years.

What is the status of AGC pilot projects? What benefits will AGC provide once commissioned on a pan-Indian level?

The CERC provided a roadmap for the operationalisation of reserves in October 2015. This roadmap identified primary, secondary and tertiary controls as important components for secure grid operation. A total of 3,600 MW of secondary reserves with secondary frequency controls were earmarked. AGC was operationalised for the first time in January 2018 in India on a pilot basis. The AGC pilot project is operational at one location each in four of the five regions of the country and its implementation in the fifth region, that is, the north-eastern region, is in progress. The total capacity post the last phase would be about 5 GW on AGC. POSOCO filed a petition in November 2018 for the implementation of AGC in all interstate generating stations (ISGS). The CERC, vide its order in August 2019, directed all thermal ISGs with installed capacity of 200 MW and above and all hydropower stations of capacity exceeding 25 MW (excluding run-of-the-river hydro projects), irrespective of the size of the generating station and whose tariff is determined or adopted by the CERC, to install equipment at unit control rooms for transferring the data for AGC as notified by the National Load Despatch Centre (NLDC). A full-scale AGC project will enable efficiency and grid security in the power system, making it ready to handle the 175 GW of renewables targeted by 2022.

How has been the experience in ancillary services operations? What are the next steps?

The implementation of ancillary services was carried out in April 2016 through a regulated mechanism. With the help of in-house development of customised software solutions, RRAS has addressed congestion management issues and optimisation at the regional and pan-Indian levels, thereby facilitating the integration of renewables. Ancillary services have proved to be a valuable mechanism for grid managers to maintain the system parameters, especially during extreme weather conditions, generating unit outages, transmission line trippings and high demand situations. However, there are several challenges such as “gate closure” in the scheduling process, maintaining the quantum of reserves, better load and renewable generation forecasting, metrics for performance monitoring, and review of charges payable for RRAS. With the increase in complexities, more options/products are required under ancillary services for smooth grid operation. It is expected that the challenge of ramping constraint would be addressed by the incentivisation of ramping performance from April 2020 onwards. Steps are being taken to expand the ambit of ancillary services such as fast tertiary control through hydro, secondary frequency control, voltage control and black-start service. After gaining experience from the current regulated version of ancillary services, a market-based model for these services may be considered in the future.

What is the update on the setting up of the National Open Access Registry (NOAR)?

The NOAR would be an integrated and seamless IT-based system accessible to all stakeholders, including open access participants, traders and national/regional/state load despatch centres (LDCs), for automated approvals for short-term open access (STOA). It would help in maintaining an electronic repository of information such as open access granted to all customers, balance margin available per corridor, and availed STOA as per the corridor limit. The NOAR is going to be a critical project, which will help in the smooth and dynamic administration of the electricity market in India. Therefore, high-end technical compliance is required to maintain the reliability and integrity of the system. NOAR implementation is crucial for implementing the real-time electricity market in India. Looking at system requirements and the dependence of stakeholders such as the NLDC, regional load despatch centres (RLDCs), state load despatch centres (SLDCs), the CERC and all industry players in the open access market, a robust solution through NOAR is under progress. It is expected that the NOAR would be rolled out in financial year 2020 as various related processes are already at advanced stages.

What are the key learnings from the pilot project for the implementation of hydro for FRAS?

Hydropower has a well-established role in the energy sector. In a large grid like India, the flexibility rendered by hydro generators in terms of overload capability, fast ramping and peaking support has immense value for reliable, secure and economic grid operation. As renewable energy penetration increases, hydro is going to play an increasingly important role in the future electricity market. A total of 20 hydro generating stations with pondage/storage facility having a total of around 8 GW generation capacity participated in the FRAS pilot project. In the November 2018 – May 2019 period, around 538 FRAS up, 6,788 FRAS down instructions were issued. A total of 9 MUs and 43 MUs were despatched in the FRAS Regulation – Up and Down respectively. The maximum power despatched in a five-minute time-block was around 600 MW and 1,200 MW in the FRAS Regulation – Up and Down respectively. The key learnings include the introduction of fast tertiary response, layer of centralised fast response ancillary despatch (from the regional to the national level) over the decentralised layer of the scheduling process, first-time five-minute scheduling, despatch, accounting and settlement, customised FRAS software solution developed in-house, the optimisation of hydro generation, improved handling of frequency spikes, benefits to stakeholders – hydro generators and state utilities,  and low cost of implementation.

How has been the implementation of SCED? What benefits have been realised so far?

The SCED pilot was started by POSOCO on April 1, 2019. Under SCED, ISGs are being despatched based on national merit order through an optimisation exercise aimed at minimising the total generation cost while honouring the technical constraints of the power plants and the grid. A robust, resilient, self-healing solution engine developed in-house runs every 15 minutes to determine the optimal schedule for each ISGS without any human intervention in the entire process, thereby resulting in a significant reduction in the overall generation cost. The benefits have been realised in terms of optimisation of generation based on merit order thereby saving generation costs. During the April-July 2019 period, it has been observed that there has been a significant reduction in both the number of schedule changes and schedule MW changes. It has resulted in an increased PLF in cheaper power stations. Therefore, the SCED pilot project has facilitated operations for generators. It has been observed that, generally, during holidays/weekends there is an increased reduction in fuel costs. Also, during extreme weather conditions, load crash results in the schedule being revised to a technical minimum within the region and therefore, diverse resources of the generation mix pan-India are harnessed. An interim feedback report on the implementation of pilot on SCED is available on the POSOCO website for the public. Further, the CERC has given directions for the extension of the SCED pilot till March 2020.

What is your view on the relevance of energy storage technology in the Indian context?

It is felt that there is a need to harness the full potential of grid-scale storage technologies (for example, pumped storage hydropower) as well as promote other forms of energy storage technologies that are at various stages of development and deployment. The Indian grid has a large footprint and hence, a huge capability to tap the energy storage potential. The latent potential of flexibility from state hydro resources can be realised with suitable means to incentivise performance. Large-scale storage potential is a function of on-peak energy prices seen in the energy market, the amount of renewable energy expected to be online to meet the renewable mandates and the total system costs. Additionally, the amount of wholesale storage penetration is a function of load profile (which leads to peak versus off-peak arbitrage opportunities), the level of demand-side management options (which influences the system peak demand characteristics) and the amount and nature of conventional generation capacity available.

What are the key challenges in grid operation? What will be POSOCO’s main focus areas?

Electricity grid managers have a significant and critical role to play in the energy value chain and hence, they need to be quick in adapting to market changes and also mitigating new risks. One of the key priorities of POSOCO is to implement a framework for reserves along with both primary and secondary frequency controls. The implementation of AGC in the thermal and hydro ISGs as per the CERC order is being done on a priority basis. Load and generation forecasting is another thrust area to manage uncertainties on account of load and renewable variations. POSOCO is focused on improving grid resilience and equiping them with self-healing capabilities that help them adapt to natural calamities. In view of cross-border interconnections, POSOCO’s role would be pivotal beyond national boundaries.

Further, POSOCO would handhold the emerging economies to have reliable and secure grid operations as well as robust electricity markets. With the increasing penetration of renewables, use of dynamic models, simulation, field testing and the validation of models become very important to assess the reliability of the grid. Suitable provisions have to be incorporated in the grid code to ensure compliance. Real-time data acquisition from various stations across the country is a challenging task and it involves state-of-the-art technologies in SCADA/energy management system (EMS) and WAMS, as well as a strong communication network. The availability of SCADA/EMS systems is being maintained above 99.9 per cent to provide interruption-free data to grid operators. A backup control centre has  also been established as a disaster recovery system to take over the system operation function in case of any contingency in the main control center. With a vibrant electricity market and the continuous pursuit of the distribution utilities to scout for cheaper sources of electricity, the pressure on the transmission network is inevitable. Some transmission corridors get congested on a seasonal basis. In the planning horizon, several transmission lines have been envisaged to mitigate this congestion. POSOCO through its operational feedback and discussion has persuaded several transmission utilities to fast-track certain projects, so that the congestion is mitigated quickly. This process has been very successful and has helped in slowly reducing the congestion in the past three years.

Managing the power system during natural disasters such as earthquakes and cyclones has been quite challenging. The immediate effects of such natural disasters on the grid are system faults and load imbalances. This leads to high voltage and frequencies in the system which, if left uncontrolled, may lead to a cascading failure. The proactive and fast response from POSOCO has averted cascading failures in both the cases. Such high-impact, low-probability events call for the need for a resilient grid and underline the necessity for designing such a resilient grid during the planning horizon. Further, outage coordination, which includes interaction with multiple agencies on distributed locations, for the power system elements, at an all-India level are paramount tasks. This is being done by RLDCs/NLDC after a careful study and coordination with several utilities to ensure reliable and secure grid operation. There is a lot of scope for improvement in areas like interface meter adequacy, sacrosanct schedules, 5-minute scheduling and settlement, real-time generation despatching, double-entry energy accounting system, DSM based on the “causer pays” principle, and communication and data telemetry. Currently, the electricity market in India is a “physical” delivery-only market with no financial products. Forwards and futures contracts may be required to be introduced to enable higher liquidity and depth in the market. POSOCO is working closely with SLDCs through technical co-operation, knowledge sharing, regular interaction and active collaboration on various fora such as Forum of Load Despatchers. There is a need for institutional building and strengthening of LDCs at all levels and to this end, suitable frameworks for LDCs need to be evolved for attracting and retaining talent.


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