TE India Biomass Electric Power Generation Project Phase 1

Report Cover Image
Evaluation Plan:
2013-2017, India
Evaluation Type:
Final Project
Planned End Date:
10/2017
Completion Date:
12/2017
Status:
Completed
Management Response:
Yes
Evaluation Budget(US $):
30,000

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Title TE India Biomass Electric Power Generation Project Phase 1
Atlas Project Number: 00043810
Evaluation Plan: 2013-2017, India
Evaluation Type: Final Project
Status: Completed
Completion Date: 12/2017
Planned End Date: 10/2017
Management Response: Yes
Focus Area:
  • 1. Environment & Sustainable Development
  • 2. Others
Corporate Outcome and Output (UNDP Strategic Plan 2014-2017)
  • 1. Output 1.1. National and sub-national systems and institutions enabled to achieve structural transformation of productive capacities that are sustainable and employment - and livelihoods- intensive
Evaluation Budget(US $): 30,000
Source of Funding: Project Budget
Evaluation Expenditure(US $): 28,000
Joint Programme: No
Joint Evaluation: No
Evaluation Team members:
Name Title Email Nationality
Mr. Parimal Sadaphal National Consultant parimalsadaphal@gmail.com INDIA
Roland Wong International Consultant
GEF Evaluation: Yes
GEF Project Title: TE India Biomass Electric Power Generation Project Phase 1
Evaluation Type: Terminal Evaluation
Focal Area: Climate Change
Project Type: FSP
GEF Phase: GEF-3
GEF Project ID: 1199
PIMS Number: 740
Key Stakeholders: Ministry of New and Renewable Energy (MNRE)
Countries: INDIA
Comments:

The Project goal was to “improving electricity supply without increasing GHG emissions through widescale application of biomass power generation technologies” and its goal of “accelerating adoption of environmentally sustainable biomass power technologies for captive and distributed biomass materials in niche areas (including captive power use and open access power sale), through demonstration of model investment projects (MIPs) demonstrating development models and establishment of sustainable business/support services network and undertaking enabling activities for removal of the  key barriers”. 

Lessons
Findings
1.

3.1 Project Design and Formulation

Design of the RBBPG Project was conducted during the period of 2002-2005 and, as mentioned in Para 14, included a national estimate of over 540 million tonnes of biomass available for power production per year13. Assuming 70 to 75% of biomass waste being used as fodder or domestic cooking, 140 to 170 million tonnes of biomass waste would be available for power production, equivalent to installed capacities of 18,000 to 23,000 MW. Approximately 6,000 to 7,000 MW of installed capacity could be developed by agro-industrial sectors related to sugar, rice and oil mills. In addition to this available biomass waste for power generation, the use of more than 70 million ha of wasteland was viewed as potential for energy plantations. These estimates of the potential of biomass were viewed as sufficiently catalytic for investments into biomass power generation by implementing 3strategic actions, namely: knowledge development, dissemination and demonstration of MIPs to complement emphasis of the GoI on biomass-based power generation.


Tag: Clean Energy Energy Programme/Project Design

2.

Under the original LFA, the RBBPG Project Part I was to provide resources over a 3-year period to develop grid-connected biomass power projects to be undertaken with cooperative sugar mills, agro-processing industries and biomass power plants using distributed and decentralized biomass resources. The original ProDoc also targeted states with the most favourable biomass power development policies for model investment projects (MIPs). Part I, however, failed to deliver MIPs as designed with one of the chief reasons being that the Project goal and objective wereoverly ambitious tasking the Project to achieve the completion of 7 biomass power projects (totaling 26.73 MW of “greenfield” installed capacity)throughout India, and monitor the performance of the plants for 6 to 12 months, all within a period of 3 years. To achieve this, the Project would have had to overcome the following “baseline” barriers to biomass energy development in India that were prevalent in 2006:


Tag: Challenges Policies & Procedures Programme/Project Design

3.

The MTE of the RBBPG Project Part I was conducted in 2011, citing poor progress in the implementation of MIPs, changing market conditions involving rising biomass prices, and distribution companies offering power purchase agreements (PPAs) involving fixed low tariffs over a long period of time. One of the main recommendations from the MTR was a review of the RBBPG Project Part ILFA to reset realistic targets and to reorganize activities (in consideration of the complexities encountered during the 2008-2011period in implementing small-scale biomass power projects), all within a new Project time frame that assumed a no-cost Project extension to March 2014.

This LFA review was undertaken in 2013as outlined in Section 2.2. The resulting revisions of this review were:


Tag: Energy Operational Efficiency Programme/Project Design

4.

3.1.1 Analysis of Project Planning Matrix

As previously mentioned, there were 2 planning matrices for the RBBPG Part I Project. While this section is devoted to the analysis of the 2013 (and revised) Project Results framework (PRF), the Evaluation Team has the following comments on the original Log frame Matrix (LFM) that was prepared in 200317:

  • This LFM contained a narrative of each objective, outcome and output with corresponding “objectivity verifiable indicators” to be monitored with means of verification and corresponding critical assumptions for their success;
  • A critical deficiency of the LFMis the lack of clarity of targets which in some cases can be derived from the narrative of the objective, outcome and output as well as the verifiable indicators;
  • The LFM also needed to be linked with a timeline for each of the components which is implied on Tables 6, 7 and 8 on page 23 of the ProDoc(where components are referred to as “activities”) which was to take3 years to complete part I and the full dispersal of the US$5.65 million GEF grant. In hindsight, this was overambitious despite the best intentions in 2005 and 2006 to increase biomass power generation;
  • Due to slow implementation of the Project from 2006 to 2008, revision of the LFA was recommended in 2011 to reflect changing market conditions for the production of biomass power, and to refocus Project activities to support biomass power generation projects towards financial viability.

Tag: Results-Based Management

5.

The revised Project Results framework (PRF) for the RBBPG ProjectPart I (as shown in Appendix F) provides 22indicators (1 goal indicator, 1 objective-level indicator, 4 outcome level indicators and 16 output level indicators) to guide implementation of the Project towards its overall Project goal of “improving electricity supply without increasing GHG emissions through wide scale application of biomass power generation technologies”. The wording of RBBPG Project indicators and targets do not meet SMART criteria18 or best practices for the preparation of PRFs.In the opinion of the evaluation team, the absence of SMART indicators and clear targets in this revised PRF only raised the level of difficulty in effectively managing this Project. Specific comments on the quality of the revised PRF follows:


Tag: Challenges Programme Synergy Results-Based Management

6.

GHG emission reductions proposed on the RBBPG Project in the ProDoc was only covered on page 43 with an estimation of 0.14 mt CO2of GHG emission reductions generated by 43 MIPs. Moreover, this target was not even mentioned on the original LFA in the ProDoc, and no breakdown was available on scheduling of the 7 MIPs to be implemented during Part I of the RBBPG Project.

In the absence of detail GHG emission reductions calculations, the MTE of 2011did provide some calculations of GHG emission reductions generated from 2 MIPs implemented. The midterm evaluators conservatively counted only a certain percentage of the actual GHG emission reductions from these MIPs based on the contributions made by the GEF grant to the operation of these MIPs19.GHG emission reductions were not revised when the PRF was revised in 2013.


Tag: Emission Reduction Challenges Results-Based Management

7.

3.1.2 Risks and Assumptions

In the RBBPG ProDoc, critical assumptions were provided in the LFM including:

  • Bio-mass power remains as the national focus for renewable energy power development;
  • The stakeholders and project promoters look for bio-mass power as viable opportunities.

Tag: Renewable energy Challenges Operational Efficiency

8.

3.1.3 Lessons from Other Relevant Projects Incorporated into RBBPG Project Design

The ProDoc of the RBBPG Project does list other relevant projects into its design:

  • Government initiated national programme (Ministry of Non-Conventional Energy Sources), namely the“National Programme on Grid-Interactive Biomass Power and Bagasse Cogeneration” that commenced in 1993 as mentioned in Para 12. Notwithstanding its slow progress, this program successfully demonstrated projects on a commercial basis using rice husk as the main feedstock. Key lessons learned include different investment models required to combine the interests of different stakeholders that have to be considered in making the entire project chainviable. This includes merging the interests of:

Tag: Sustainability National Institutions Private Sector

9.

3.1.4 Planned Stakeholder Participation

Stakeholders were to be engaged on the RBBPG Project through personnel within the Project Management Cell (PMC)that was to be set up within the Maharashtra Industrial and Technical Consultancy Organization (MITCON). The PMC would engage stakeholders identified for capacity-building in Activity II including “R&D institutions, SEBs, state and central government agencies, financing institutions and banks, engineers and consultants, NGOs (local/regional/national agencies), service entrepreneurs, technology and equipment suppliers, project developer, sugar mill/rice mill owners, micro-entrepreneurs and project promoters.” In Activity III, stakeholder focus would be on the “development of required experts, professionals, groups of experts and professionals, NGOs and training institutions, service institutions, financial intermediaries, market intermediaries”.


Tag: Partnership Project and Programme management Civil Societies and NGOs National Institutions Private Sector

10.

3.1.5 Replication Approach

The Project design envisaged a replication approach through successful implementation of the MIPs of Outcome 4 complemented with:

  • technical assistance to reduce risks during implementation of MIPs;
  • involvement of financial institutions in the region to develop skills and relevant experience that would allow them to continue to fund biomass projects after the EOP, and when funding of biomass projects becomes institutionalized using existing or revised business development models;
  • the establishment of a guarantee mechanism designed to become operational under PartII, using lessons learned under PartI to improve the success rate of MIPsdeveloped.

Tag: Knowledge management Sustainability National Institutions Regional Institutions

11.

3.1.6 UNDP Comparative Advantage

As is usually the case with several other UNDP projects, this Project also had a distinct advantage compared to projects funded by other donor agencies in terms of its focus on policy-based and cross-sectoral approaches as well as creating local capacities through effective collaboration with a wide range of local stakeholders, encompassing public and private sectors in addition to technical experts, civil society and grassroots level organizations. These approaches were strongly applicable to promoting biomass power generation projects on the RBBPG Project. Given UNDP’s long track record on a wide variety of projects within the energy sector, UNDP was appropriately suited as the agency championing this Project.


Tag: Donor relations Civil Societies and NGOs Private Sector

12.

3.1.7 Linkages between RBBPG Project and Other Interventions within the Sector

UNDP oversaw the implementation of two earlier GEF-supported projects in India that involve promoting biomass energy. The first is the bio methanation project (Development of High Rate BiomethanationIND/92/G32). This project promoted the development and implementation of high-rate biogas reactors. However, the technological focus of the project largely overlooked institutional and financial constraints resulting in equipment procurement delays, procedural delays in financial clearances, and reluctance by project proponents to contribute 50% ofthe capital costs. The experience on this project also demonstrated considerable time expended on preparation activities and stakeholder consultations. The RBBPG Project sought to utilize the technical assistance and investment risk mitigation support systems of this project to accelerate biomass power generation investments.

The second project (India Biomass Energy for Rural India IND/99/G31or BERI) proposed a number of biomass energy technologies to meet rural energy needs in a village setting through a number of different business models. While the focus of this project is significantly different from the RBBPG Project, lessons from the BERI Project should were to have been incorporated into the RBBPG Project if deemed appropriate.


Tag: Operational Efficiency Programme/Project Design

13.

3.1.8 Management Arrangements

The implementing partner of the RBBPG Project was the Ministry of new and Renewable Energy (MNRE)in accordance with UNDPs National Implementation Modality (now referred to as National Execution or NEX modality). NEX modality tasked MNRE with responsibility for certifying work plans and approved budgets, reporting on procurement, coordinating and tracking co-financing, terms of reference for contractors and tender documentation, and chairing the Project Steering Committee (PSC). The Chair of the PSC was to be the National Project Director (NPD) from MNRE.In the approved ProDocof 2005, the MNES was named as the Implementing Partner. The name of this ministry was changed in 2006 to its current name, MNRE. An organogram of the RBBPG Project Part I implementation arrangements is provided on Figure 1.


Tag: Implementation Modality Oversight Ownership Project and Programme management

14.

3.2 Project Implementation

The following is a compilation of key events and issues of RBBPG Project Part I implementation in chronological order:

  • The RBBPG Project was signed by the Government of India on September 22, 2006;
  • The period between 2006 and 2008 was marked by almost no achievements and few reports;
  • Some progress was made commencing 2008 with 2 out of the 7 MIPs that ultimately emerged being approved and supported by the Project;

Tag: Human and Financial resources Knowledge management Operational Efficiency Programme/Project Design National Institutions Private Sector

15.

3.2.1Adaptive Management

Adaptive management is discussed in GEF terminal evaluations to gauge Project performance and the ability of a project to adapt to changing regulatory and environmental conditions, common occurrences that afflict the majority of GEF projects. Without adaptive management, GEF investments would not be effective in achieving their intended outcomes, outputs and targets.

During the critical commencement period from September 2006to early 2008, the RBBPG Project Part I made almost no progress despite the expenditures of US$1.14 million up to June 30, 2008. A Project audit conducted for 2007 raised concerns that were discussed between UNDP India’s senior management and the Secretary, MNRE. In response to addressing this significant shortcoming, decisions were made in October 2008 to restore Project transparency and put in place the systems and controls for achievement of deliverables and objectives of the Project. Adaptive management measures undertaken included:


Tag: Procurement Project and Programme management

16.

By mid-2011, the MTE mission was undertaken to provide further recommendations on adaptively managing the RBBPG ProjectPart I. The MTE reported that while the Project was expected to achieve targets related to technology benchmarking, enhanced capacity, and development of support services, significant shortcomings were anticipated in the achievement of the Project goal and objective consisting of GHG emission reductions generated from operational MIPs. This observation set the stage and justification for the Project to review its LFA and to reset realistic targets prior to the EOP date which was reset at that time from March 31, 2012 to March 31, 2014. It also recommended reorganization of activities with realigned timelines, considering the complex issues involved in implementing small-scale biomass power projects, and the changed market, policy and regulatory environment in the country.


Tag: Monitoring and Evaluation Operational Efficiency Policies & Procedures Programme/Project Design Project and Programme management Results-Based Management Capacity Building

17.

3.2.2 Partnership Arrangements

The primary partnership of the RBBPG Project was with the stakeholders of the MIPs. Assessment of the partnership arrangements of the RBBPG Project, however, was constrained by the lack of documentation of consultative meetings with stakeholders, the awareness-raising efforts of the Project (with no list of attendees to the various workshops and events under Component 2), follow-ups on discussions held during these workshops and events (which would allow the evaluation team to assess the impacts of these activities and partnerships formed), and a lack of evidence of extensive discussions with MIP proponents (notably lead up discussions to implementation of the MIPs, and discussions after implementation of the MIPs on operational experiences).


Tag: Challenges Communication Knowledge management Partnership

18.

From late 2012 to 2014, the Project undertook a surge of awareness-raising workshops and events designed to interest and catalyze investment into biomass power generation projects. This included consultative meetings with groups such as the IBPA, and various renewable energy development agencies in Orissa, and smaller such agencies in the island states of Andaman, Nicobar and Lakshadweep. Moreover, these workshops appear to focus mainly on grid-connected biomass power generation projects which as mentioned in Para 63, were becoming less financially attractive. This resulted in what appears to be little or no follow-up on these workshops by the PMC.

The urgency for follow-up on these workshops may have been dampened by issues related to the declining demand for biomass power generation due to falling solar PV electricity tariffs(again as mentioned in Para 63). There are still, however, excellent opportunities for the Project to involve stakeholders in the captive market for biomass power generation as well as those projects that address environmental issues (see Paras 125, 132, 141, 147 and 148for more details). With the late setup of the biomass knowledge portal (mentioned in Para 62), overall efforts by the RBBPGProject Part I to facilitate strengthened partnerships to accelerate the development of biomass power generation projects were moderately unsatisfactory.


Tag: Challenges Knowledge management

19.

3.2.3 Feedback from M&E Activities Used for Adaptive Management

Feedback for M&E activities was provided primarily through PIRs. Unfortunately, the Evaluation Team were not provided a full set of PIRs during the entire Project implementation period:

  • PIR was not available for 2007;
  • The PIR from 2008 was not informative, with development progress reporting not coinciding with the Project’s LFM. As such, reading this PIR did not provide any useful information on reasons for the slow progress since 2006;
  • The quality of PIRs from 2009-2015 had improved allowing project monitors to better track progress against the PRF;
  • Despite GHG emission reduction targets in the revised PRF of 2013, post-2013 PIRs did not provide any reporting on progress towards Project GHG emission reduction goal;
  • NoPIRs were made available from 2016 and 2017.

Tag: Emission Reduction Monitoring and Evaluation

20.

3.2.4 Project Finance

The RBBPG Part I Project had a GEF budget of US$5.65million that was to be disbursed over a 3-year duration. After the reorganization of the RBBPG Project in October 2008, GEF resources were advanced by UNDP to the IREDA, the nonbanking financial institution under the administrative control of MNRE.AWPs were prepared by the PMCto inform IREDA and UNDP on how GEF funds were to be utilized. Unfortunately, the TE team was not provided with any of audit reports on the effectiveness of funds utilized. In addition, details of when the Project made investments into the MIPswas not available to the TE team. Without this information, the TE team has been unable to assess the cost-effectiveness of Project expenditures towards reaching the Project goal of 460,000tonnes CO2eq.


Tag: Challenges Global Environment Facility fund Human and Financial resources Private Sector

21.

3.2.5 M&E Design at Entry and Implementation

The ProDoc, MTR nor the review of the LFAin 2013 provided an M&E design. There is no mention of any detailed M&E activities such as the inception workshop and report, PIRs, periodic progress reports, midterm review, and audit reports. As such, the M&E design is rated as highly unsatisfactory.


Tag: Emission Reduction Monitoring and Evaluation

22.

3.2.6 Performance of Implementing and Executing Entities

The performance of the implementing partner of the RBBPG Part I Project, MNRE, can be characterized as follows:

  • The early stages of the Project between 2006 to 2008 was marked by little to no delivery of any of the intended outputs, but expenditures of close to 25% of the RBBPG Part I budget;
  • Following the Project re-organization in September 2008, MNRE proceeded with a cautious approach to delivery of Project activities, in compliance with GoI regulations and procedures. However, delivery of Part I would take activities beyond the original 3-year Project period due to a combination of the over-ambitious design (as mentioned in Para), and the slower pace of delivery by MNRE in strict compliance with GoI procurement rules;

Tag: Challenges Policies & Procedures Project and Programme management

23.

The performance of UNDP (the Implementing Agency) can be characterized as follows:

  • UNDP experienced difficulties in effective communication with implementing partner, MNRE during the early stages of the Project between2006 and 2008;
  • UNDP initiated a management review of the Project in 2008 in close consultation with MNRE in light of poor delivery of outputs and close to 25% of the budget expended. This resulted the replacement of all previous Project personnel, improved oversight into Project expenditures to ensure compliance with GoI rules and regulations, and agreement that the UNDP procurement process will be utilized if requested by GoI;
  • UNDP India as well as personnel from the Regional Center in Bangkok were involved with troubleshooting, and increasing the pace of progress notably in state tariffs for biomass power, notably after 2013;
  • Overall performance of UNDP on the RBBPGProjectPart I can be assessed as being moderately satisfactory.

Tag: Human and Financial resources Implementation Modality Policies & Procedures Project and Programme management

24.

3.3 Project Results

This section provides an overview of the overall project results and assessment of the relevance, effectiveness and efficiency, country ownership, mainstreaming, sustainability, and impact of the RBBPG Part I Project. In addition, evaluation ratings for overall results, effectiveness, efficiency and sustainability are also provided against the revised July 2013Project PRF(as provided in Appendix F)37. For Tables 4to 8, the “status of target achieved” is color-coded according to the following scheme:

3.3.1 Overall Results

With regards to the target of 15.2 MW of additional cumulative biomass power generation capacity by the EOP, the Project has achieved 39.7 MWwithin 7 MIPs. While this target has been met, there are several issues that accompany the achievement of this target including:


Tag: Emission Reduction Effectiveness

25.

As mentioned in Paras 69 and 76, very little attention was paid to monitoring CO2 reductions. As such, without operational records of each of the MIPs and details of the nature and timing of the Project investment into these MIPs, the TE team is unable to reliably estimate the CO2 emission reductions generated by this Project. Moreover, the lifetime CO2 reductions over the MIPscannot be reliably estimated due to the discontinuous operations of mostMIPs. GHG emission reductions achieved during the Project duration was in the order of 200,000 tCO2(over 10 years), mainly achieved through strengthened fuel supply linkages, and not greenfield projects. Further details of GHG emission reduction estimates are provided on Table 4 as well as results under Outcome 5.


Tag: Emission Reduction Challenges

26.

With regards to the indicator and target or additional greenfield MIPs after 2013 up to 15.2 MW, the Project oversaw a general lack of interest on biomass power generation. This was primarily due to the lack of interest in electricity sales from biomass power plants caused by falling solar PV electricity tariffs, and the higher and fixed operational costs of biomass power generation projects.As of 2015, only 7 MW of biomass power generation projects were under consideration (one 1 MW gasifier project in Tamil Nadu by M/s Cummins Cogeneration Pvt Ltd., 3 biomass power plants (2MW + 2MW + 1MW) on 3 islands in Lakshadweep, and one 1 MW biomass power plant in Andaman & Nicobar islands. However, the TE team have not received any reports of completion on the aforementioned projects. In addition, one of the Project measures for contacting to potential biomass project investors was through expressions of interest, which resulted in responses from a number of entities, many of whom could not comply with minimum requirements for Project support. A summary of the achievements of RBBPG Project Part I at the Objective level with evaluation ratings are provided on Table 5.


Tag: Renewable energy Challenges Operational Efficiency

27.

3.3.2 Outcome1: Technology package benchmarking & validation for different biomass power technologies

Activities under Outcome 1 were intended to result in“technology package benchmarking and validation for different biomass power technologies including the feasibility of energy plantations”. Project resources were to be used to generate outputs including:

  • potential of biomass hybrid technology for power generation in India explored, documented and shared with MNRE;
  • technology performance and evaluation of benchmarks for MIPs available;
  • long term perspective plan for utilization of wasteland and biomass resources for power generation; and
  • socioe conomic study for assessment of impact of biomass power plant on employment generation, livelihood improvement and environment.

Tag: Renewable energy Challenges Technology

28.

With regards to the DPRs in response to the floating of an EOI by the Project, and information generated by the Project on the feasibility of biomass hybrid projects, a total of 16 responses were received in early 2015. However, these potential developers were noncommittal building biomass hybrid projects due to the stated reluctance of Indian financial institutions on funding biomass related projects. A second EOI was issued in early 2015 inviting proposals for biomass solar thermal projects that resulted in no response. As a result, no DPRs on biomass hybrid projects have been received by the Project for review by MNRE.

With regards to benchmarking of MIP technologies, a number of important studies were completed by the Project. By 2010, some of the important studies completed included:


Tag: Policies & Procedures Technology Knowledge management

29.

With regards to Project efforts to develop long-term strategic planning for the use of wastelands and biomass power projects, there had been a number of other studies completed by 2010 to study the utilization of various biomass types for power generation including:

  • Utilization of rice husk for providing electricity in rural areas;
  • Feasibility of briquetting of agro-residues;
  • Management of field distributed crop residues

Tag: Renewable energy Challenges Effectiveness Human and Financial resources

30.

Outcome 2: Enhanced capacities and confidence of stakeholders

With regards to the enhancement of stakeholder capacities, activities under Outcome2 were intended to “enhanced capacities and confidence of project promoters, financial institutions, regulators, policymakers, SNAs, other stakeholders through effective information development and dissemination program, along with capacity building initiative”. Project resources were to be utilized to generate outputs including:

  • Increased availability of information for project promoters and all stakeholders in focused states and their enhanced knowledge base;
  • Improved capacity of key stakeholders and project promoters in targeted states that includes:

o Communication and advocacy on biomass power become regular feature;

o Improved access to information through website;

o Capacity building modules developed and tested in target states/sectors; and

o study tours organized for missions in national events.


Tag: Capacity Building

31.

A summary of the actual achievements of the activities of Outcome 2with evaluation ratings are provided on Table 7.

With regards to “increased availability of information available for project promoters and all stakeholders in focused states”, issues of the “Bioenergy Magazine” between September 2009 and July 2011 have been uploaded onto both MNRE and UNDP Project websites with a focus on biomass power technologies, policy and regulatory issues, and best practices. The name of the publication changed to “Biopower Magazine” with quarterly issues commencing in January-March 2014to March 2016. Due to lack of strong support for biomass projects by MNRE, there has been no confirmation of any more recent publications of the Biopower Magazine since March 2016.


Tag: Communication Knowledge management

32.

By 2010, the outcomes of various studies undertaken during the project implementation created positive advocacy to regulators and policy makers as well as directly impacting some National Programmes being implemented by the Ministry including:

  • providing inputs to the formulation of revised Guidelines by CERC for determination of normative tariff for biomass power and bagasse cogeneration projects in 2009;
  • a policy that exempts biomass power projects having capacity ≤ 15 MW from an EIA study;
  • modification of the National Program on Biomass Gasification Technology to enable effective involvement of manufacturers, beneficiary industries and non-governmental organizations;
  • development of guidelines for setting up of biomass power projects with reduced risk that include sustainable biomass fuel linkages;
  • modification in the national program on bagasse cogeneration to facilitate cooperative sector sugar mills to take up cogeneration projects through BOOT (Build, Own, Operate, Transfer) model; and
  • benchmark norms for material specifications and performance standards for biomass gasifiers and revised procedure for empanelment of gasifier manufacturers.

Tag: Effectiveness Knowledge management Policies & Procedures

33.

By 2015, a web-based Knowledge Portal for biomass power project development was developed (www.biomasspower.gov.in). The knowledge portal did serve asa user-friendly single point source for information and data related to biomass power, covering biomass power generation, grid-connected as well as off-grid and captive applications; and thermal energy from biomass. While the biomass web portal was formally launched by Mr. Piyush Goyal, HonourableMinister of State for Power, Coal and New & Renewable Energy on 14 May 2015, updating of the website was last conducted in March 2016. Since then, no new information has been posted on the website, leading to speculation that the website will not be supported after the EOP. The effectiveness of this website is questionable considering inception of the website in 2015, a time when there was a decline in interest in biomass investments due to decreasing solar PV tariffs, and when MNRE were not actively promoting viable biomass opportunities such as captive applications for agro-processing industries and biomass power generation to avoid burning of rice stalk and associated air pollution problems.


Tag: Communication Knowledge management Policies & Procedures Awareness raising Capacity Building

34.

In 2013, the Project also facilitated the formation of a working group chaired by the NPD to work on the removal of barriers and challenges in the development of biomass power. The working group sought to identify biomass power development issues related to tariff, financing, fuel supply security, suitable policy interventions, actions required at regular intervals for re-validation of biomass resource atlas and appropriate studies on fuel pricing. Efforts of the working group resulted in the CERC revising the tariff for biomass power plants to Rs.7 per kWh to be implemented by SERCs51.
 


Tag: Challenges Knowledge management Operational Efficiency

35.

Outcome 3: Development of business, commercial and support services networks

Activities under Component 3 were intended to “develop business, commercial and support services networks in focused states”. The RBBPG Project Part I resources were to be utilized to support national level events as well as state and regional level events to bring together biomass power practitioners, project developers and other relevant stakeholders to share their expertise and promote learning and the strengthening of commercial and support services for biomass power projects. Unfortunately, activities in Outcome 3 only were designed to support 3 networking events and thus making it difficult to understand how these activities contributed towards the development of business, commercial and support services networks, which have not been clearly defined in any of the Project documents. A summary of the actual achievements of Outcome 3 with evaluation ratings are provided on Table 8.


Tag: National Regional Trade and Development

36.

3.3.5 Outcome 4: Creation of fund for contingent financing

The original Outcome 4 (referred to in the ProDoc as Activity 4) was the “identification and selection of MIP models”. At a point unknown to the evaluation team, this outcome was changed to the “creation of fund for contingent financing” under which resources from the RBBPG Project Part 1 were utilized for this purpose up to 2013. The purpose for the contingent financing was never clearly defined; however, both GEF and GoI committed US$5 million for the fund. Various project documents stated that the contingent fund was to provide project preparation funds for biomass project developers as well as funds to be used for unforeseen circumstances in the development and operation of biomass power plants. This was thought to have included funds for working capital during the initial year of operation of a biomass plant after commissioning.


Tag: Global Environment Facility fund Human and Financial resources National Institutions

37.

Outcome 5: Model Investment Projects (MIPs)

Activities under Component 5 were intended to “commence implementation and commissioning of model investment projects (MIPs)”. Project resources were to be utilized to commission and stabilize MIPs, implement green field MIPs, and document lessons and evolution of replication strategy for biomass MIPs.A summary of the actual delivery of outputs from Outcome 5with evaluation ratings are provided on Table 9.

With regards to the commissioning and stabilization of MIPs and implementation of greenfield MIPs, the evaluation team refers the reader to Table 3on the latest status of the MIPs as of the EOP. There was no progress towards achieving the targets set in 2013 for new MIPs. With regards to the intended targets of entire outcome, the Project took considerable time to strategize its approach on how to support the MIPs:


Tag: Effectiveness Human and Financial resources Trade and Development

38.

By the EOP, two projects were not operational:

  • The 1.0 MW biomass gasification technology in Sankheda, Gujarat owned by Ankur Scientific Energy Technology Pvt. Ltd. The primary reason for the plant shut down has been the crash of REC prices and the failure of Ankurto secure the PPA with Gujarat SERC at a tariff that could sustain plant operations57; and
  • The 2.0 MW biomass combustion plant developed by Dee VeePower in Kushal Nagar, Karnataka. Plant was never completed due to the owner not being able to comply with the conditions of MNRE and Project support which requires the plant equipment to be erected and commissioned as well as demonstrating successful operations for 3 months. The plant owner despite having purchased all equipment, is unable to find financing to complete the plant which may be dismantled within the next 3 to 4 months.

Tag: Emission Reduction Challenges Operational Efficiency

39.

At the EOP date of July 31, 2017, the RBBPG Project had several other biomass projects in the pipeline that have not yet received Project support including:

  • Kandra Energy’s2 MW biomass-based distributed power generation plant at Bellary, Karnataka: The project was to use cotton stalk, paddy straw, rice husk, bamboo chips biomass residues with 25% of the power being sold to local communities at Rs.4.2/kWh with 2% annual escalation and the remainder to Karnataka Power Corporation Limited (KPCL) at a feed-in tariff of Rs.3.72/kWh with 2% annual escalation. Initiated in 2010, this project has not yet achieved financial closure, partly due to the low feed-in tariff. Project will not likely be implemented unless the Government of Karnataka increases the feed-in tariff for biomass power plants;
  • Three greenfield biomass power plants (3MW + 3MW + 1MW) on three islands in Lakshadweep that are currently being developed;
  • One greenfield biomass power plant (1MW)in Andaman & Nicobar islands currently under development;
  • A greenfield 1 MW Gasifier being commissioned by Cummins Cogeneration Ltd.In Tamil Nadu.

Tag: Renewable energy Challenges Operational Efficiency Project and Programme management

40.

With the notable surplus of GEF funds still remaining as of 2016 (upwards of US$2.4 million), the MNRE suggested the restructuring of the RBBPG Project during the review meeting held on February 23,2016(and in MNRE’s proposal to GEF-OFP and UNDP on March 10, 2016) in a last attempt to catalyze biomass power generation investments, with the following conditions:

  • include bio methanation of green organic waste to include fruits, vegetables, flower market wastes, agro-industrial wastes (pressed mud from sugar industry, wastewater residues from fruits, maize tapioca starch processing industry), and livestock manure;
  • hold a consultation meeting with potential stakeholders immediately to discuss plant layouts, cost of waste to power plants, financial support requirements and preliminary feasibility;
  • set a target of the minimum 5 bio methanation projects with a cumulative capacity of 5 MW;
  • extend the Project for a period of 2 years to utilize the remaining US$2.4 million of GEF funds.

Tag: Challenges Global Environment Facility fund Human and Financial resources

41.

3.3.7 Relevance

The RBBPG ProjectPart I still remains relevant to the development priorities of India, notably the Integrated Energy Policy (IEP) of 2006 and the National Action Plan on Climate Change (NAPCC). The objective of the RBBPG Project Part I of“accelerating the adoption of environmentally sustainable biomass power technologies for captive and distributed biomass materials in niche areas” is in line with the Government’s strategy to increase India’s energy security, and to undertake and implement key strategies and actions to mitigate the impacts of climate change. Although the Project has taken 10 years to implement with profound changes to the market conditions for renewable energy, the promotion of biomass energy in India still remains relevant to India’s development goals in consideration of the availability of biomass, the number of SME industries still utilizing fossil fuels many of which are imported, and the opportunities to convert biomass to energy to resolve significant environmental issues in India.


Tag: Relevance Renewable energy

42.

3.3.8 Effectiveness and Efficiency

The effectiveness of the RBBPG ProjectPart I has been moderately unsatisfactory, given the shortcoming of the Project goal in not achieving GHG emission reduction targets, and not achieving the Project objective of accelerating adoption of biomass power technologies and distributed biomass materials. The Project was successful in formulating and successfully lobbying the CERC for a biomass tariff of Rs. 7/kWh for dissemination to SERCs. However, the lack of Project effectiveness can be largely attributed to:

  • the changing marketplace for renewable energies (with the falling price of solar PV power);
  • a general lack of active and focused adaptive management to promote biomass power projects that are viable in captive applications and for resolving significant environmental problems;
  • experiencing of difficulties to provide sufficient influence over SERCs to honour long-standing PPAs with tariffs to sustain BMPPoperations;
  • too much focus on the sale of electricity to the grid.

Tag: Renewable energy Challenges Effectiveness

43.

3.3.9 Country Ownership and Drivenness

In consideration of the current state of the biomass power generation market, the RBBPG Project has not resulted in improvements in the regulatory framework for the approval of biomass projects in India. Moreover, despite the financial attractiveness of cogeneration biomass projects and over 2,000 MW of cogeneration projects in operation, the RBBPG Project has not resulted in any improvements in streamlining regulatory approvals for biomass power generation projects. In particular, this would apply to biomass power generation projects which have open access for sale of electricity to the national grid. The complexities of promoting biomass power generation in India are strongly linked to working at state-level institutions to ensure security of power purchase agreements between biomass power producing entities and state-level utilities for the sale of electricity.


Tag: Challenges Ownership Renewable energy

44.

3.3.10 Mainstreaming

The intended objective and outcomes of the RBBPG Project Part I are successfully mainstreamed with:

  • the UNDAF for India 2008 to 201259, specifically UNDAF CP Outcome 4.2: Communities are aware of their vulnerabilities and adequately prepared to manage and reduce disaster and environmental-related risks, Output 4.3.2:Capacities build and pro poor initiatives supported at national and local levels to directly address environmental issues. One of the targets for this output is to “increase access to clean energy with focus on renewable energy technologies for remote areas”;
  • UNDAF for India for 2013 to 201760, specifically UNDAF/CPD Outcome: Government, industry and other relevant stakeholders actively promote environmental sustainability and enhanced resilience of communities inthe face of challenges of climate change, disaster risk and natural resource depletion”, with CP output of “access to clean energy is expanded to underserved communities and small-scale industries”by “demonstrating solutions to reduce barriers for investment into biomass projects”.

Tag: Agriculture Climate Change Adaptation Clean Energy Environment Policy Renewable energy Jobs and Livelihoods Capacity Building

45.

3.3.11Sustainability of Project Outcomes

In assessing sustainability of the RBBPG Project Part I, the evaluators asked “how likely will the Project outcomes be sustained beyond Project termination?” Sustainability of these objectives was evaluated in the dimensions of financial resources, socio-political risks, institutional framework and governance, and environmental factors, using a simple ranking scheme:

•4 = Likely (L):negligible risks to sustainability;•3 = Moderately Likely (ML): moderate risks to sustainability;•2 = Moderately Unlikely (MU):significant risks to sustainability; and•1 = Unlikely (U): severe risks to sustainability; and•U/A = unable to assess.Overall rating is equivalent to the lowest sustainability ranking score of the 4 dimensions.


Tag: Challenges Sustainability Human and Financial resources

46.

3.3.12 Impacts

The RBBPG Project Part I did not achieve the desired impacts of accelerating the adoption of biomass power generation and increased use of biomass materials for power generation. The resulting impact of the RBBPG Project Part I was a low level of GHG emission reductions from biomass MIPs considering the expenditure of US$3.25 million of GEF grant funds. Despite Project support for 7 MIPs, the impact of Project support has not been significant in the context of catalyzing biomass power project investments over and above the baseline growth of biomass power projects (which was estimated by MNRE to be 1,677 MW in 2008 and 2,808 MW in 2013 as mentioned in Para 21). Much of this growth was fuelled by CDM (with an estimated 2,933 MW in the CDM pipeline as of 2008)61.Of the 7 MIPs:


Tag: Emission Reduction Challenges Impact

47.

The efficiency of the RBBPG Project Part I has been unsatisfactory for a range of reasons:

  • the Project was designed to be implemented within 3 years. The original Project duration specified in the ProDoc was 3 years although the Project took 11 years with just over 40% of the original GEF funds remaining of US$2.4 million;
  • during the first 2 years of the Project in 2006 to 2008, close to US$1.4 million was expended with very few if any outputs delivered;
  • approximately US$1.85 million of Project funds was expended between 2009 and the termination date of July 31, 2017, a span of almost 8 years. During these 8 years, the Project managed to support 7 MIPs, all of which were completed with varying degrees of success. In consideration of the modest level of funds spent to achieve support for 7 MIPs as well as project outputs that assisted biomass Project developers (such as model templates for PPAs and agreements, and the recommended national biomass tariff of Rs.7 recommended by the CERC), these outputs have been delivered with moderate cost-effectiveness. However, these expenditures have not resulted in the delivery of the objective of the Project, which was to accelerate the adoption of biomass power technologies and distributed biomass materials

Tag: Efficiency

Recommendations
1

Methodologies for project planning, design, implementation, monitoring and evaluation to feature more intensive engagement and capacity building of investors, project proponents and developers.

2

Actions to follow up or reinforce initial benefits from the project: All MIPs or demonstration projects should employ a monitoring officer to compile data and information pertaining to energy generation, plant revenue and GHG emission reductions. Since MIPs serve as demonstrations of functional biomass power projects for the purposes of replicating these types of projects, there is a strong need for a focus on reporting credible energy savings of these investments as well as sharing rates of investment returns and GHG emission reductions.

3

Foster a more enabled policy environment for BMP and increased involvement of biomass associations as well as agro-processing industries

1. Recommendation:

Methodologies for project planning, design, implementation, monitoring and evaluation to feature more intensive engagement and capacity building of investors, project proponents and developers.

Management Response: [Added: 2017/12/20] [Last Updated: 2021/02/08]

This has been taken note of and will be applied to any future phases of this project or similar new projects

Key Actions:

Key Action Responsible DueDate Status Comments Documents
1.1. Methodology to include setting up of demonstration plants to disseminate lessons of design, implementation and operation as well as extensive handholding of project proponents on plant design, contracting, construction supervision, community outreach, commissioning, maintenance
[Added: 2017/12/20] [Last Updated: 2017/12/28]
MNRE 2017/12 No Longer Applicable [Justification: The project is closed]
The Evalution report is shared with the stakeholders History
1.2. Project Management Cell (PMC) personnel to improve stakeholder engagement through face-to-face interactions
[Added: 2017/12/28]
MNRE 2017/12 No Longer Applicable [Justification: The project is closed]
1.3. Project implementation arrangements to include Direct Implementation Modality (DIM) by UNDP
[Added: 2017/12/28]
UNDP/MNRE 2017/12 No Longer Applicable [Justification: The project is closed]
2. Recommendation:

Actions to follow up or reinforce initial benefits from the project: All MIPs or demonstration projects should employ a monitoring officer to compile data and information pertaining to energy generation, plant revenue and GHG emission reductions. Since MIPs serve as demonstrations of functional biomass power projects for the purposes of replicating these types of projects, there is a strong need for a focus on reporting credible energy savings of these investments as well as sharing rates of investment returns and GHG emission reductions.

Management Response: [Added: 2017/12/20] [Last Updated: 2021/02/08]

MNRE will designate one official to collect information and will include the same in its annual reports

Key Actions:

Key Action Responsible DueDate Status Comments Documents
2.1. All MIPs or demonstration projects to employ a monitoring officer for compilation of data and information on energy generation, plant revenue and GHG emission reductions
[Added: 2017/12/21] [Last Updated: 2017/12/28]
MNRE 2017/12 Completed History
3. Recommendation:

Foster a more enabled policy environment for BMP and increased involvement of biomass associations as well as agro-processing industries

Management Response: [Added: 2017/12/28] [Last Updated: 2021/02/08]

MNRE will work with MoEF to develop a suitable package for making biomass power production more attractive to producers

Key Actions:

Key Action Responsible DueDate Status Comments Documents
3.1 Use information generated through MIPs for promoting biomass based captive power in agro-processing industry
[Added: 2017/12/28] [Last Updated: 2018/04/09]
MNRE 2018/07 Completed History
3.2 Moot NCEF compensation to PSEB for purchasing biomass power at a higher rate as a “credit” for air pollution alleveation
[Added: 2017/12/28] [Last Updated: 2018/10/02]
MNRE & MOEF 2018/12 No Longer Applicable [Justification: The project is closed]
History

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