Opportunities beyond solar and EVs: Fortum interview

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pv magazine: With Fortum a clean energy solutions provider, which areas other than solar and EV charging infrastructure are you looking at in India to help the transition to a low-carbon economy?

In the last five years there has been a lot of push for renewables. [The] Indian market – both for solar and EVs – offers a great opportunity for researchers to find a breakthrough advancement in lithium based storage solutions. We want to continue our focus on solar. That would remain our foundation. We will build it up step by step, gradually creating projects that are best in class.

We have already launched our EV charging infrastructure and will expand it in sync with EV adoption in India, along with battery swapping pilots.

We have also started our bioethanol refinery along with Numaligarh refinery in [the] northeast and our intent is to expand it further and do more on [the] biomass side.

In addition, we have advanced optimized solutions for nitrogen oxide (NOx) reduction in thermal power plants and will continue to expand on that front. Our technology aims to reduce NOx emissions which are very harmful to health and cause acid rains that have a damaging effect on forests and lakes.

As thermal is going to be a mainstay in India’s energy mix for the next 30 years, the Indian government has, among other things, defined new permissible NOx emission levels for coal-based thermal power plants in India, to be achieved by 2022: 600 mg/normal cubic meter [Nm3] for plants installed up to December 31, 2003; 300 mg/Nm3 for those installed between January 1, 2004 and December 31, 2016; and 100 mg/Nm3 for those installed from January 1, 2017 onwards.

To support India to achieve this goal, Fortum has introduced its own innovative NOx reduction technology in India under the new business line called Fortum eNext.

Fortum’s low-NOx solution is based on primary reduction methods, preventing NOx formation in the combustion process. It reduces emissions effectively – even up to 80% – and, compared to other solutions [such as] secondary methods, offers the benefits of a minimum need for new equipment, no auxiliary power consumption, no water consumption and no ammonia or urea consumption, [with] no byproducts for disposal.

Lastly, waste-to-energy excites Fortum and we have done several projects in [the] Nordic [nations]. Bioethanol and biomass-related energy systems, waste to energy, battery lifecycle solutions and hazardous waste management would find [an] increased share in Fortum’s [business] offering as we go forward.

Solar tariffs in India have declined rapidly. Analysts have voiced concern developers who bid such low tariffs may be unable to realize their projects. Do you agree? How can developers reduce project costs to stay competitive?

Solar power tariffs in India have witnessed [an] unprecedented fall in the last couple of years, primarily owing to the fall in imported solar panel prices and [the] competitive bidding dynamics prevalent in the industry. This has helped India achieve more than 20 GW of installed, or under-installation solar capacity in [the] last two years.

Unfortunately, this fall in solar tariffs has led to discoms [power distribution companies] delaying their long-term power procurement on the expectations of further falls. Whether the fall in module price shall continue [at a] similar rate or not is something to watch out for.

Global developments in the last couple of months, such as [the] extension of [the] solar program in China or [the] verdict on Suniva’s case [petitioning for tariffs to be applied to solar panel imports] in [the] U.S. [which have led] to [a] shift [or] increase in demand in those local markets, have not augured well for Indian developers and they have witnessed [a] sharp increase in module prices. Project developers must keep looking for their niche areas to stay competitive in future bids, given the uncertainty in project allocation in the short term.

Ironically, while we say that we [have a] power surplus, there are regions in India which experience unreliable power or long power cuts. Also, per capita usage of electricity is still abysmally low, at 850 kWh in India.

The government needs to focus on demand creation and [must] holistically look at delivering sustainable clean power, inclusive of transmission and distribution [costs] to the consumers in the long run, rather than being too much enamored with reverse auctions and lower tariffs at any cost.

Given the paucity of space for infrastructure, especially in cities, how can India scale up EV charging for the smoother adoption of EVs? Fortum has come up with EV charging at taxi stands. Will this work for India? Do you have any such plans for India?

For EVs to be acceptable in India, consumers must be assured of [the] availability of charging stations, like fuel stations for internal combustion engine vehicles. If adequate and appropriate charging points are available within cities as well as along highways, it would alleviate the range concerns of vehicle users.

Currently, the foremost concern of prospective EV owners is what they would do if they got stuck in [a] traffic jam and the [car] battery was showing low [charge]. A robust charging station network would give them confidence and that would act as a pull effect for original equipment manufacturers.

There are two major requirements for scaling up the charging infrastructure: access to land and availability of adequate electrical infrastructure. As EVs are expected to be adopted first in [the] major cities of India, space constraint poses a major challenge. To overcome this, the government has to support willing charging-infrastructure companies by providing … space at public locations [such as] municipal parking [lots], metro stations and airports.

As India would require a large number of public charging stations, private investment would be needed to scale up the infrastructure. To attract private investment, a fair competitive market environment has to be facilitated.

We are happy to note the FAME-II [The Faster Adoption and Manufacturing of (Hybrid) and Electric Vehicles] scheme has provided about $1.5 billion [Rs10,517 crore] for creating charging infrastructure in the next three years.

Though the detailed guidelines on using this fund have not been made public, we hope private players shall also be given the opportunity to avail [themselves of] this fund for developing charging infrastructure.

We are constantly evaluating the market for charging infrastructure. In [the] Nordic market we have taken [the] lead in setting up the latest charging technology, [such as] 150-350-kilowatt high-power capacity chargers that take less than 10 minutes to charge a compatible car for 125 km. In Oslo we have also started a pilot project of wireless charging for taxi fleets. We see huge potential [for] wireless charging in India as well.

Overall, what capacity are you looking at for India’s EV infrastructure, and where?

With a dominant presence in Nordic countries and the Baltic region, Russia and Poland, Fortum is looking to deepen [its] presence in India by building on its network of charging points for EVs.

Fortum India has already operationalized 40 direct current [DC], unmanned charging points in the suburbs of Hyderabad and Mumbai. On our radar are the advanced cities with higher per capita incomes, and people with greater disposable incomes. So, in addition to Hyderabad and Mumbai, we are looking at cities [such as] Delhi, Chennai, Bengaluru, Chandigarh and Pune.

While these DC charging points cater to four-wheeler passenger cars, we have also launched a pilot project of battery swapping for three-wheelers in and around [the] DLF Mall of India in Noida, where 30 Zbees [e-vehicles] are operating with two 1.5 kWh, swappable battery packs.