Businesses talk about going “green” all the time but very few ever get around to doing much about it. Reason? It takes a lot of legwork and ingenuity to acquire a more organic way of life. For L&T and its constituent businesses acquiring a greener posture has always meant finding more sustainable ways of conducting business. And yes, without compromising on profitability.
A case in point is L&T Metro Rail (Hyderabad) Limited or LTMRHL’s solar initiative under which it has been implementing captive solar power plant on station rooftops and depots. The project currently underway in full steam is not only expected to increase the sustainability quotient of the metro project by reducing its dependence on grid power and lower its overall carbon footprint but also result in substantial monetary savings for LTMRHL.
A special purpose vehicle of L&T, LTMRHL is one of the country’s most anticipated metro rail projects. A study in project management excellence and execution at L&T, the project is now in its final stretch before completion.
Typically metro systems are power intensive enterprises and estimates suggest that roughly 40% of the total cost of running a metro is spent on power expenses. In case of Hyderabad Metro this power is to be delivered by Telangana State DISCOM, an entity which depends largely on Thermal Power generators. Besides the possibility of incurring considerably higher charges – power tariffs are fairly steep in the state – the arrangement stood to increase the carbon footprint of the metro system significantly after it would become fully operational.
Another thing which concerned project officials is their high dependency on the grid and the fact that there was no backup power source which they could rely on. High costs, complete dependency on a single source and grid’s potential negative impact on its sustainability quotient, were enough to encourage LTMRHL to examine alternative power sources that would not only be cheaper but greener as well. After much deliberation it was felt that solar power was a suitable alternative worth looking into.
An internal team conducted further research to identify spaces in the station premises for implementing solar plants and recommended that station rooftops and depots be used since they were ideally suited for the exercise.
Not wanting to add to its CAPEX, LTMRHL assigned the solar project to a third party on a BOOT (Build-Own-Operate-Transfer) model after a tender followed by a reverse e-auction. Under the terms of the contract agreement it worked out capacities of 8 MW and 7 MW on depots and station rooftops respectively amounting to 15 MW of power. A minimum power generation guarantee was also worked into the contract – something that is unheard of in the industry – from the vendor for 25 years.
The solar power plant initiative of LTMRHL isn’t the first one in the country. The Delhi Metro Rail project has already implemented a similar project. What makes the Hyderabad Metro project unique is the fact that the implementation works of solar plant precedes the revenue operations of metro rail, which reduces the complexity of work and implementation time considerably. Once the metro system goes live, deploying such a project would have been incredibly difficult given the very small window for implementation work. Another thing which makes the project unique is that the entire work was awarded as a single package with staggered roll out resulting in competitive tariff from the vendor. LTMRHL is set to get power at Rs.4.9/kWh flat for the next 25 years resulting in NPV savings of Rs. 98 crores over the duration of the contract.
The project has also lowered Hyderabad Metro’s high dependence on state grid for power requirement by 21% by supplying 15 MW out of the total requirement of 70 MW. Not only that but by installing the power source within the premises, the project stands to save on any kind of transmission losses and wheeling charges and offer greater control over the generation source.
But perhaps the most important of all the benefits to accrue is the reduction in carbon emission by 16,000 tons annually making the metro rail project stand out as an example of sustainability and green business initiatives.
A four member team from LTMRHL comprising Kumar Vibhash, Uday Kiran Batlanki, K Kalyan Kumar Reddy and M Santosh Raviraj continues to work tirelessly to ensure that the project reaches its intended objectives. The team believes that the project has a great potential for horizontal deployment in future metro projects due to come up soon in other parts of the country.
