Cogeneration can be a win-win situation for all mill owners, the government, power utilities and the common people
 For over a decade, industrial cogeneration has been generating much interest in India. However, cogeneration has been restricted to the production of electricity for self use only and viewed as a means to meet simultaneous on site needs for heat and power independent of the grid.
Cogeneration and futureAmong all forms of renewables, biomass cogeneration is the most stable with higher plant load factor (PLF). Cogeneration can also contribute to the grid for almost 8 months in a year. The government’s ambitious target of installing 175 GW of renewable energy by 2022 also provides ample opportunity. “Being one of the major components in bio-energy sector, the bagasse cogeneration could well set the tone,” explains Priya Bhamare, Manager – Design and Projects, Sitson India Pvt. Ltd., “With a lot to achieve, this could prove to be a win-win situation for all mill owners, the government, power utilities and the citizens of the country.”
Factors influencing growth of the Indian cogeneration marketMany industries — including the sugar, pulp and paper, and textile — have been co-generating steam and electricity for many years. Ms Bhamare describes nicely why cogeneration has been favoured for several reasons. These are:These industries have significant simultaneous steam and power requirements.By products or waste are produced in these industries that can be used as low-cost fuels.Many of the plants in these industries are located in areas not connected to the grid.The industries want to insulate themselves from undependable utility supplies and lower their plant operating costs.
Sanjeev Nimkar, BU Head, Power Generation, Kirloskar Oil Engines Ltd., believes that 2 to 3 factors are generally influencing the market. “The first factor being availability of power in the country which is directly affects sale of the lower kVA range, 30 kVA to 40 kVA requirements are affected,” says Mr Nimkar. “If the power availability in the country matches its needs, the demand for gensets comes down. Secondly, from 40 kVA onwards up to 1,000 or 2,000 kVA, generator purchases are mainly for commercial or industrial requirements. In this scenario, what impacts the demand is the economic condition; GDP growth of the country has a major role to play in this.”
According to Santosh Dahotre, GM and Head Marketing and Sales, Turbo Tech Precision Engineering India (P) Ltd., “Indian cogeneration market is influenced by the fuel cost and the growth in industrial production.”
Products or services currently offered meeting customer needs?Customers expect value addition to his operations by harnessing the untapped potential of power generation through incidental power generation at a minimal CAPEX. “The present day products and services are technologically well-developed,” says Mr Dahotre. “However, there is scope to optimise the solutions offered to bring down the pay back for the project to less than 12 months.”
Detailed study for select commissioned cogeneration power plants identifies key parameters like generation and exportable power per tonne of cane crushed vis-à-vis technology configuration deployed, station heat rates, auxiliary power consumption, steam to fuel and steam to power ratios during season and off-season, down-times, Plant Load Factor (PLF), manpower capacity.
Mr Nimkar claims that their range of products is the widest by any single brand in the market, in terms of number of nodes and kVAs. Its range extends from 2.1 kVA to 625 kVA as a single unit. With a combination of multiple units (paralleling), we can supply up to 5.5 MW.Key focus areas to keep cogeneration companies ahead of competitionThe industry is hopeful that the requirement for power in India improves. The country have been witnessing reasonable rise in demand, and the markets will be generally growing towards standard applications. “We expect that there will be increased demand for remote monitoring/control of gensets,” says Mr Nimkar. “This is already a feature being sought by some of our customers in the market. To explain this, the owner of a genset should be aware of its parameters like engine rpm, load, temperature, and oil and fuel level to know accurately if the genset is operating within allowable limits. It is imperative that the owner of the genset comes to know of any arising problems in advance to take corrective measures.”
Ms Bhamare lists out some points that can help cogeneration companies stay ahead of completion. These are:Relaxing existing financing norms, including interest rate, moratorium, repayment period and securities (through MNRE risk capital fund)Development, demonstration and commercialisation of innovative financial models, and terms and conditions, including FDI and Foreign Currency (FC) loansEvolving a back-ended financing structure for bagasse cogeneration projects with enabling provisions to overcome fluctuations in sugar and cogeneration operations.
Challenges affecting the growth of cogenerationThe first challenge the industry has just overcome is the change in pollution norms to CPCB 2. “In our industry, second level emission norms have been put into practice, which is a good step since we are becoming more responsible towards our environment,” says Mr Nimkar. “But this move also puts an enormous strain at our back-end since we had to change our entire portfolio as per the new norms. We invested close to ` 75 crore to get our products suited to the new pollution level norms. We also anticipate that in the next 3-4 years another level of norms might be adopted.”
Then imports from Chinese manufacturers can prove to be a major challenge in future if the Chinese gensets get qualified as per the new pollution norms. “Other challenges remain towards the unorganised manufacturers in the market who supply loose engines.”
Ms Bhamare feels the biggest challenge is funding. “Considering the paucity of funds and precarious financial situation, the industry direly needs funding, both in terms of equity and debt, with innovative financial terms,” she said. “This exactly is also the golden opportunity for foreign direct investments in both equity and debt, given the conducive investment environment emerging in India.”
Mr Dahotre believes that poor application engineering by non-serious players may lead to failure of the project, leading to lack of confidence by the surrounding cluster of industry. Even the projects should be approved as a qualified investment for various focused industry development funds.
Ms Bhamare is very optimistic because the key barriers, particularly related to technology, have been removed over this long period of almost two decades. She adds, “Extra high pressure and temperature configurations up to 110 kg/sq. cm and 540 C have been technically and commercially established, while operation and maintenance of key equipment like boiler, turbine, water treatment plant and DCS have also been established. The totally negative mindsets and fear amongst the sugar factory technocrats and personnel have more or less become positive for implementing cogeneration power plants.
Despite being a fruitful proposition, the sector is also faced with certain issue that need to be addressed at the central and state government levels. “The investors demand a long-term policy certainty and assurance from the regulators with respect to tariff structure,” says Ms Bhamare.  “When moving from one state to another, one faces the problem of non-uniformity in policy and regulatory regime.”
India has been implementing cogeneration programmes since mid-90s.  A total of 288 biomass power and cogeneration projects aggregating to 2,665 MW capacity have been installed in the country for feeding power. Around 70 cogeneration projects are under implementation with surplus capacity aggregating to 800 MW.
_________________________________Being one of the major components in bio-energy sector, the bagasse cogeneration could well set the tone.
Priya Bhamare, Manager – Design and Projects, Sitson India Pvt._______________________________________________
We expect that there will be increased demand for remote monitoring/control of gensets.
Sanjeev Nimkar, BU Head, Power Generation, Kirloskar Oil Engines Ltd.__________________________________________________
Indian cogeneration market is influenced by the fuel cost and the growth in industrial production.
Santosh Dahotre, GM and Head Marketing & Sales, Turbo Tech Precision Engineering India (P) Ltd.

Cogeneration can be a win-win situation for all mill owners, the government, power utilities and the common people
 For over a decade, industrial cogeneration has been generating much interest in India. However, cogeneration has been restricted to the production of electricity for self use only and viewed as a means to meet simultaneous on site needs for heat and power independent of the grid.
Cogeneration and futureAmong all forms of renewables, biomass cogeneration is the most stable with higher plant load factor (PLF). Cogeneration can also contribute to the grid for almost 8 months in a year. The government’s ambitious target of installing 175 GW of renewable energy by 2022 also provides ample opportunity. “Being one of the major components in bio-energy sector, the bagasse cogeneration could well set the tone,” explains Priya Bhamare, Manager – Design and Projects, Sitson India Pvt. Ltd., “With a lot to achieve, this could prove to be a win-win situation for all mill owners, the government, power utilities and the citizens of the country.”
Factors influencing growth of the Indian cogeneration marketMany industries — including the sugar, pulp and paper, and textile — have been co-generating steam and electricity for many years. Ms Bhamare describes nicely why cogeneration has been favoured for several reasons. These are:These industries have significant simultaneous steam and power requirements.By products or waste are produced in these industries that can be used as low-cost fuels.Many of the plants in these industries are located in areas not connected to the grid.The industries want to insulate themselves from undependable utility supplies and lower their plant operating costs.
Sanjeev Nimkar, BU Head, Power Generation, Kirloskar Oil Engines Ltd., believes that 2 to 3 factors are generally influencing the market. “The first factor being availability of power in the country which is directly affects sale of the lower kVA range, 30 kVA to 40 kVA requirements are affected,” says Mr Nimkar. “If the power availability in the country matches its needs, the demand for gensets comes down. Secondly, from 40 kVA onwards up to 1,000 or 2,000 kVA, generator purchases are mainly for commercial or industrial requirements. In this scenario, what impacts the demand is the economic condition; GDP growth of the country has a major role to play in this.”
According to Santosh Dahotre, GM and Head Marketing and Sales, Turbo Tech Precision Engineering India (P) Ltd., “Indian cogeneration market is influenced by the fuel cost and the growth in industrial production.”
Products or services currently offered meeting customer needs?Customers expect value addition to his operations by harnessing the untapped potential of power generation through incidental power generation at a minimal CAPEX. “The present day products and services are technologically well-developed,” says Mr Dahotre. “However, there is scope to optimise the solutions offered to bring down the pay back for the project to less than 12 months.”
Detailed study for select commissioned cogeneration power plants identifies key parameters like generation and exportable power per tonne of cane crushed vis-à-vis technology configuration deployed, station heat rates, auxiliary power consumption, steam to fuel and steam to power ratios during season and off-season, down-times, Plant Load Factor (PLF), manpower capacity.
Mr Nimkar claims that their range of products is the widest by any single brand in the market, in terms of number of nodes and kVAs. Its range extends from 2.1 kVA to 625 kVA as a single unit. With a combination of multiple units (paralleling), we can supply up to 5.5 MW.Key focus areas to keep cogeneration companies ahead of competitionThe industry is hopeful that the requirement for power in India improves. The country have been witnessing reasonable rise in demand, and the markets will be generally growing towards standard applications. “We expect that there will be increased demand for remote monitoring/control of gensets,” says Mr Nimkar. “This is already a feature being sought by some of our customers in the market. To explain this, the owner of a genset should be aware of its parameters like engine rpm, load, temperature, and oil and fuel level to know accurately if the genset is operating within allowable limits. It is imperative that the owner of the genset comes to know of any arising problems in advance to take corrective measures.”
Ms Bhamare lists out some points that can help cogeneration companies stay ahead of completion. These are:Relaxing existing financing norms, including interest rate, moratorium, repayment period and securities (through MNRE risk capital fund)Development, demonstration and commercialisation of innovative financial models, and terms and conditions, including FDI and Foreign Currency (FC) loansEvolving a back-ended financing structure for bagasse cogeneration projects with enabling provisions to overcome fluctuations in sugar and cogeneration operations.
Challenges affecting the growth of cogenerationThe first challenge the industry has just overcome is the change in pollution norms to CPCB 2. “In our industry, second level emission norms have been put into practice, which is a good step since we are becoming more responsible towards our environment,” says Mr Nimkar. “But this move also puts an enormous strain at our back-end since we had to change our entire portfolio as per the new norms. We invested close to ` 75 crore to get our products suited to the new pollution level norms. We also anticipate that in the next 3-4 years another level of norms might be adopted.”
Then imports from Chinese manufacturers can prove to be a major challenge in future if the Chinese gensets get qualified as per the new pollution norms. “Other challenges remain towards the unorganised manufacturers in the market who supply loose engines.”
Ms Bhamare feels the biggest challenge is funding. “Considering the paucity of funds and precarious financial situation, the industry direly needs funding, both in terms of equity and debt, with innovative financial terms,” she said. “This exactly is also the golden opportunity for foreign direct investments in both equity and debt, given the conducive investment environment emerging in India.”
Mr Dahotre believes that poor application engineering by non-serious players may lead to failure of the project, leading to lack of confidence by the surrounding cluster of industry. Even the projects should be approved as a qualified investment for various focused industry development funds.
Ms Bhamare is very optimistic because the key barriers, particularly related to technology, have been removed over this long period of almost two decades. She adds, “Extra high pressure and temperature configurations up to 110 kg/sq. cm and 540 C have been technically and commercially established, while operation and maintenance of key equipment like boiler, turbine, water treatment plant and DCS have also been established. The totally negative mindsets and fear amongst the sugar factory technocrats and personnel have more or less become positive for implementing cogeneration power plants.
Despite being a fruitful proposition, the sector is also faced with certain issue that need to be addressed at the central and state government levels. “The investors demand a long-term policy certainty and assurance from the regulators with respect to tariff structure,” says Ms Bhamare.  “When moving from one state to another, one faces the problem of non-uniformity in policy and regulatory regime.”
India has been implementing cogeneration programmes since mid-90s.  A total of 288 biomass power and cogeneration projects aggregating to 2,665 MW capacity have been installed in the country for feeding power. Around 70 cogeneration projects are under implementation with surplus capacity aggregating to 800 MW.
_________________________________Being one of the major components in bio-energy sector, the bagasse cogeneration could well set the tone.
Priya Bhamare, Manager – Design and Projects, Sitson India Pvt._______________________________________________
We expect that there will be increased demand for remote monitoring/control of gensets.
Sanjeev Nimkar, BU Head, Power Generation, Kirloskar Oil Engines Ltd.__________________________________________________
Indian cogeneration market is influenced by the fuel cost and the growth in industrial production.
Santosh Dahotre, GM and Head Marketing & Sales, Turbo Tech Precision Engineering India (P) Ltd.