Why Grid India is turning to more gas-based power, Pg13

Key Highlights:

• Grid Controller of India (Grid India) has advised gas-based power stations to prepare for additional generation for 7-8 days in June.
• This directive is in response to weather forecasts predicting below-normal rainfall during the June-September monsoon season.
• Only about 5 Gigawatts (GW) of gas-based generation capacity is currently available, significantly less than the typical 10 GW relied upon during peak summer.
• Power sector entities have substantially increased natural gas purchases from the spot market, acquiring 13,92,500 Million Metric British Thermal Units (MMBtu) between June 1 and June 23.
• Spot market gas prices have risen sharply, with the average price reaching Rs 1,846 per MMBtu in June.

Detailed Insights:

• Gas-based power plays a crucial role in balancing the grid during evening peak hours, especially when solar power generation declines.
• The ongoing conflict in West Asia has disrupted long-term gas import contracts, compelling power plants to increasingly rely on the more volatile spot market.
• Hydroelectric power stations are conserving water in their reservoirs due to anticipated low monsoon rainfall, limiting their capacity for flexible peak-hour generation.
• Grid India's assessment considers historical data, planned outages of generating units, and the inherent variability of renewable energy sources.
• The government has prioritized gas allocation to specific sectors amidst concerns over supply disruptions.
• Purchases of natural gas from the spot market by power sector entities surged by 340.4% between April 1 and May 31 compared to the same period last year.

Key Concepts Involved:

• Grid Controller of India (Grid India): The national agency responsible for operating the electricity grid and ensuring its reliable and efficient functioning.
• Gigawatt (GW): A unit of power equal to one billion watts, commonly used to measure the capacity of large power plants or electricity grids.
• Million Metric British Thermal Units (MMBtu): A standard unit of energy used to measure natural gas, representing one million British Thermal Units.
• Spot Market: A market where commodities, such as natural gas, are traded for immediate delivery at current market prices, often influenced by short-term supply and demand.