Rapid Response

Role of gas-based power in meeting peak demand

Peaking power refers to electricity use at its highest points during a day. While day-to-day power demand needs to be met by power plants, it is not optimal for them to produce the maximum power requirement at all times. Therefore, there are baseload power plants, such as coal-fired plants, which provide the minimum needed electricity; and peaking power plants or peakers, which meet the fluctuating needs. Natural gas power plants are the most common peaker plants as they are despatchable – that is, they can be turned on or off and their output can change very quickly.

With an ambitious renewable energy target of 175 GW by 2022, gas-based power generation will help balance the renewable energy in the grid. In addition, it will help meet peak demand, which lasts from mid-June until October in most states. As flexible gas-based power generation has quick start-ups, deeper turn downs and faster ramp rates, it is a key enabler for the integration of higher renewables into the system, and for meeting the seasonal power and peak demand.

Key advantages

Gas-based power plants are very flexible for adjusting the output power level. They could be designed to meet specific start/ stop and ramp up to meet state-specific demands. A recent study by the Power System Operation Corporation has concluded that a ramp rate of 300 MW per minute must be provided by coal- and gas-based power plants. Of this, more than one-fifth is expected to come from gas-based power stations. Other sources for meeting peak power demand include storage-based hydropower plants, and thermal storage and battery storage systems. However, gas-based units (open cycle and combined cycle gas turbines) require the least amount of time for start-up and the least amount of energy per MW. Moreover, gas-based plants offer black start facilities (the process of restoring power in the event of a total or partial grid shutdown without relying on the recovery of the external transmission system), relieve network constraints and provide increased flexibility. The shorter the start-up time, the quicker a power plant can reach minimum load. This flexibility makes it a good partner to renewable energy sources such as solar and wind, which are only available when the sun shines and the wind blows.

Gas-fired power becomes more competitive when the long-term costs associated with climate change and the impact of air pollution, both on people and the environment, are included. Gas-based power plants can operate at as low as 10-20 per cent of the related load in open cycle mode.

Combined cycle gas plants are suitable for providing primary frequency response, as they can produce up to about 15 per cent of the gas turbine rated load (about 10 per cent combined cycle rated load) as primary response in 10 seconds, and full stabilised response within the first 30 seconds. Besides, gas is a clean energy source, next only to renewable energy sources. The nitric oxide emissions of gas-based plants are as low as 25 parts per million (ppm) and can be reduced further to 15 ppm with the use of new technology. Domestic gas-based power also provides an economical option with a variable cost of Rs 2.50-Rs 3 per unit, much lower than the peak hour price of electricity on the exchanges. Moreover, an increase in gas-based power generation would help replace more expensive liquid fuels across a wide variety of power applications.


Despite all the benefits, gas-fired power plants face many challenges, in terms of gas availability, its economics and infrastructure, including pipelines and storage. Natural gas demand far exceeds domestic supply, and this shortage is likely to persist in the near future. Additional demand is met through imported regasified liquefied natural gas. A shortage of domestic gas has kept the utilisation of India’s 25 GW of gas-fired plants at about a fifth of total capacity. Moreover, the cost of gas imports reduces the competitiveness of the fuel in relation to other sources of baseload power.

The flexibilisation of gas-based power plants increases operations and maintenance costs while reducing efficiency. In combined cycle mode, the turbine takes two to three hours to get started. Till then, it can be operated in open cycle mode.

The way forward

A more progressive peaking power supply price signal is needed to appropriately reward flexible supply. Regulatory interventions are required, such as the introduction of  pricing mechanisms (a time-of-day generation tariff system) for peaking capacity, with adequate commitment and despatch to meet grid and market needs. In addition, suitable compensation mechanisms must be in place to support the peaking operation of gas stations along with modifications in the operating norms. A uniform taxation policy should be introduced to make gas-based power generation economical in all states.

Going forward, taking the future of the power system as well as the  targets for renewable integration into account, steps must be taken at the planning stage itself to build a robust and flexible power system. Proactive regulatory intervention is also necessary. Tapping an alternative clean energy source such as gas-based power to meet the load requirements is an imperative.


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