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The Tamil Nadu Electricity Regulatory Commission (TNERC) has released an Explanatory Memorandum (EM) on the Draft Tamil Nadu Electricity Regulatory Commission (Framework for Resource Adequacy) Regulations, 2024. This memorandum aims to provide a comprehensive framework for resource adequacy in Tamil Nadu’s electricity sector, focusing on demand assessment, generation resource planning, procurement planning, and monitoring and compliance.
Tamil Nadu’s electricity demand and energy requirements are expected to grow significantly in the coming years. The state’s renewable energy (RE) capacity has increased substantially, with a 65% growth in installed capacity from FY18 to FY23. This growth positions Tamil Nadu as a leader in the renewable energy sector in India, with further plans to expand wind power capacity by 25 GW by 2030.
As the state transitions to a higher share of renewable energy, several challenges arise, including the need to treat RE capacity for peak load and increased system ramping and balancing requirements. The proposed Resource Adequacy (RA) framework aims to address these challenges by ensuring a cost-effective approach to meeting forecasted demand while maximizing resource utilization among distribution licensees (DLs) and states.
RA involves the planning of generation and transmission resources to reliably meet projected demand in compliance with specified reliability standards. This framework is crucial for scaling up renewables in the grid while maintaining grid reliability in a cost-effective manner. It also considers the need for flexible resources, storage systems, and demand response measures to manage the intermittency and variability of renewable energy sources.
The existing institutional frameworks include several key regulations and guidelines. In December 2022, the Ministry of Power (MoP) notified the Electricity Amendment Rules, stating that State Electricity Regulatory Commissions (SERCs) would frame RA Regulations following Central Government guidelines and State Model Regulations by the Forum of Regulators (FoR). The Central Electricity Regulatory Commission (CERC) and the Central Electricity Authority (CEA) have also issued relevant guidelines and codes for integrated resource planning.
The Draft TNERC (Framework for Resource Adequacy) Regulations, 2024, should be read alongside the present EM, which outlines various aspects of RA planning. The EM is organized into sections covering demand assessment and forecasting, generation resource planning, procurement planning, and monitoring and compliance.
Demand assessment and forecasting are critical first steps in RA planning, involving the forecasting of peak (MW) and energy (MUs) requirements for multiple horizons (short, medium, and long-term). This process requires a scientific approach at an hourly granularity to identify overall resource requirements to meet demand with minimal cost implications while maintaining reliability.
Generation resource planning includes capacity crediting, planning reserve margin, and RA requirement and allocation. Capacity crediting ensures that generation resources are available to meet demand even with generation outages and variability. The Planning Reserve Margin (PRM) is a percentage of the projected capacity resources over the projected peak load forecast, ensuring resource adequacy by meeting reliability targets such as Loss of Load Probability (LOLP) and Energy Not Served (ENS).
Procurement planning involves the mix of procurement resources, the type and tenure of procurement, and capacity trading/sharing. This ensures an optimal mix of resources to meet demand reliably and cost-effectively. Monitoring and compliance are essential to ensure adherence to the RA framework and regulations.
The Draft Tamil Nadu Electricity Regulatory Commission (Framework for Resource Adequacy) Regulations, 2024, and its accompanying Explanatory Memorandum provide a detailed and structured approach to ensuring resource adequacy in Tamil Nadu’s electricity sector. By addressing demand assessment, generation resource planning, procurement planning, and monitoring and compliance, the framework aims to support the state’s transition to a higher share of renewable energy while maintaining grid reliability and cost-effectiveness. |
