The Lignite to Methanol project of capacity 0.4 MTPA will be a landmark project in the country being the first of its kind and will provide a great opportunity for other lignite mines in the country, says Prasanna Kumar Motupalli, CMD, NLC India Limited in an interview with EVolution Auto India.
Q: Please walk us through NLC India’s business journey, including its major milestones, crucial achievements and its commitment to sustainability.
Prasanna Kumar Motupalli: NLC India was incorporated in 1956. With the commencement of mining operations on 20 May 1957 and power generation in 1962, NLCIL has since been growing steadily and contributing to energy security and economic development. The initial aim of the company’s birth was to create Industrial development in the country by exploiting the available resources.
Since then, NLC India Ltd (NLCIL) has strongly emphasized sustainability and integrated it into its core business activities. This shall be evident from the deployment of the Specialized Mining Equipment’s, Conveyer systems operating on electricity rather than on Internal Combustion Engine (ICEs) based vehicles for mining operations.
The company follows a Green Agenda that prioritizes People, Planet, and Profit, emphasizing the integration of society, environment, and economy. Key focus areas include eco-restoration in mines, afforestation, rainwater harvesting, waste utilization, biodiversity conservation, water and energy management, pollution control, and climate change mitigation.
NLCIL also invests in employee training in environmental management and adheres to safety, quality, and energy efficiency standards. NLCIL places a significant focus on utilizing surplus mine water for irrigation, drinking water, and industrial purposes in the surrounding areas.
The company also promotes eco-parks, eco-mine tourism, bamboo plantation, and the extraction and use of sand from overburden to minimize waste generation and environmental impact.
Instead of dozers and dumpers which create much of air pollution inside mines, NLCIL is deploying the huge capex affinity SMEs and conveyer system utilizing electricity. This has largely reduced the emissions within mines.
For the first time in the country, we are establishing a 50 MW solar power plant in the mined-out land. Once this project is successfully commissioned and operated, the concept of repurposing mined out land will take a different but positive turn.
We have also appointed agency for studying the feasibility of establishing a pumped storage hydro plant in mined out land. Considering the essential requirement of energy storage in the upcoming times due to higher RE penetration, this technology will help in addressing India’s energy security issues.
Studies are also underway for filing the mine voids with fly ash from thermal power plants near mines. This will also help in avoiding mine voids and subsequent threat of non-usability of land.
Water beneath the lignite seam is extracted for mining and used for irrigation for farming, drinking water needs for vicinity and Chennai. Our initiatives are very much focused towards sustainability, aligned towards the National objectives.
Q: NLC India Ltd (NLCIL) aims to increase its renewable energy capacity to 10 GW by 2030. Could you shed some light on the strategies and actions taken by NLCIL to achieve this ambitious target?
Prasanna Kumar Motupalli: NLCIL is first CPSU to install 1 GW of Renewable Energy (RE) capacity. Presently, the Company is operating 1370 MW of Solar Power Plants in various southern Districts of Tamil Nadu, in Neyveli Township and in Andaman & Nicobar Islands, and 51 MW Wind Power Plant in Tirunelveli district of Tamil Nadu. NLC India Ltd. marked its 10th anniversary of renewable energy generation (REG) in September 2024.
NLC India formed a wholly owned subsidiary NLC India Renewables Ltd (NIRL) to Strengthen Renewable Energy Projects and dedicated to asset monetization. NLCIL also has incorporated a wholly owned arm NLC India Green Energy Ltd (NIGEL) for commission. NLCIL intends to achieve RE portfolio mix of 50 percent of the total planned capacity, i.e, from the present RE capacity of 1.43 GW to 10.11 GW by 2030.
The above plan entails an investment of INR 50,000 Cr (approx) in Renewable portfolio, which will support India’s RE target and contributes to the broader aim of achieving ‘Net Zero’ emissions by 2070. This enhanced target aligns with the Government’s ‘Panchamrit’ initiative announced at the COP 26 Summit as India’s contribution & commitment towards climate action.
Currently, 2 GW of renewable energy assets are under implementation, NLCIL aims to expand its portfolio by participating in competitive bidding and exploring emerging opportunities in the green energy sector. This expansion will reduce India’s dependence on conventional energy sources, diversify energy generation, and lower coal import. Additionally, it will help ensure round the clock power supply across the country. This encompasses 600 MW solar power project in Gujarat and an 810 MW Solar Photovoltaic Power Project in Rajasthan.
NLCIL envisages increasing the share of Renewable Energy from 50 percent at 2030 to 77 percent at 2047 in its energy generation portfolio, enabling the company to achieve Net Zero by 2070. With a much-changed energy landscape beyond 2030, NLCIL foresees no new thermal power capacity addition. Instead, Innovation in reducing the emissions from the existing thermal power stations will be the guiding action in the domain.
On October 24, 2024, NLC India Ltd has entered an Agreement for formation of Joint Ventures (JVs) with Rajasthan Rajya Vidyut Utpadan Nigam Limited (RRVUNL) to establish Renewable Energy projects in the state of Rajasthan.
Apart from the above, we are also in advanced stage of signing Joint Venture Agreement with Assam Power Distribution Company Limited for developing 1000 MW Solar project in the State of Assam.
Currently, the company has renewable energy projects of about 2,060 MW that are under implementation in various parts of the country. We are establishing a 300 MW solar power project at Barsingsar on land available with us. The engineering, procurement and construction (EPC) contractor has been appointed and we expect to commission the project during the second quarter of 2024-25.
NLCIL won a 600 MW solar project capacity at the Khavda Solar Park, a project being developed by Gujarat State Electricity Corporation Limited in Bhuj district, Gujarat. The letter of award has been received and procurement tenders have been floated. We expect the project to be commissioned during 2024-25.
In addition, an EPC contractor has been appointed for establishing a 200 MW solar project for development under the central public sector undertaking scheme. On August 27, 2024, NLC India also signed a power usage agreement with Telangana State distribution companies (DISCOMs) to supply 200 MW of solar power for a 25-year period under the Central Public Sector Undertaking (CPSU) Scheme.
NLCIL also won 810 MW solar project from Rajasthan Urja Vikas Nigam Limited (RUVNL) for development in the Pugal Solar Park, Rajasthan. For this, tenders have been floated for the appointment of the owner’s engineer.
NLC India Ltd & WAPCOS Ltd, a public-sector enterprise under the Ministry of Jal Shakti signed a Memorandum of Understanding (MoU) to collaborate on pumped storage and hydropower. NLCIL is exploring pump storage projects as energy storage solutions to achieve our objective of clean and green energy,
We are in discussion with Odisha, Telangana, Andhra Pradesh and Karnataka for installing our own solar power stations.
Q: NLC India recently revalidated its Corporate Plan 2030 and Vision 2047. Apart from investing in renewable energy, what other Sustainable Green Initiatives are you planning to undertake?
Prasanna Kumar Motupalli: In a world focused towards sustainability and low carbon footprint, it has become imminent to relook into the way we do business. Our country’s commitment towards climate change is the driving force behind our Corporate Plan realignment.
India is committed to a low carbon emission path while pursuing its development goals, as pledged at COP 26. The nation aims to achieve 500 GW of non-fossil energy capacity by 2030. As a leading & responsible Central Public Sector Enterprise, NLC India Limited (NLCIL) plans three-fold increase (ie. 20 GW) in its total power generation capacity by 2030, to address the double requirement of energy security and sustainability. Our total installed power generation capacity is 6,731 MW, of which renewable energy constitutes 1,431 MW capacity.
We have an aggressive expansion plan in the mining sector too. From 50 MTPA, we aim to be 102+ MTPA mining company with diversified operations including lignite to methanol, green hydrogen, pumped storage plant by 2030.
We expect our pilot scale green hydrogen project based on 4 MW Solar Power Project to operationalize during FY 24 – 25. Based on the learnings and the outside economic factors, we aim to venture big in the green hydrogen economy.
Energy Storage Systems are set to play a vital role in the power sector ecosystem in the days to come. We have already established an 8 MWhr Battery Energy Storage System project at Andaman for smoothening the 20 MW solar power output. Our BESS at Andaman has given us an understanding and we plan to try a Pumped Storage Project in our Mine Void area in Neyveli. Put together we will be in a position to position ourselves in the energy storage domain.
The Lignite to Methanol project of capacity 0.4 MTPA will be a landmark project in the country being the first of its kind and will provide a great opportunity for other lignite mines in the country.
Pilot Green Hydrogen project based on 4 MW Solar Power Project has been planned at Neyveli. Tenders are being finalized by the project management consultant.
In the path to a sustainable future, creating Wealth from Waste plays an important role. Accordingly, as a novel initiative, NLC India Limited established an Overburden to M- Sand plant at Mine IA, Neyveli, Tamil Nadu. The M-Sand plant of NLC India Limited at Mine IA can produce 2.62 Lakh Cubic Meters annually. M-Sand production reduces demand on traditional river sand which helps to maintain the water table, reduce erosion etc. Utilizing OB to extract M-Sand will reduce land desertification caused by storing OB dumps. M-Sand is cheaper than river sand in terms of cost and environmental damage. NLC India Limited is in the process of establishing similar M- Sand plants at its Lignite Mine I (6.25 Lakh Cubic Meters per year) and in Lignite Mine II. Extraction of M- Sand from Overburden promotes a Circular economy and showcases the ‘Sustainable Mining’ (waste to wealth) practices of NLC India Limited.
First time in the country, a solar power project of this capacity 50 MW is being established in the reclaimed mined-out land utilizing around 80 hectares of land. This maiden venture will help in repurposing the reclaimed land and will supplement the Mine operation requirement through green power from Solar Projects. The project is proposed to be developed at a capital outlay of around Rs. 295 Crore and set to generate 118 million units of electricity annually. This project will become a State-of-the-art facility for showcasing to the entire globe, the success in repurposing of mined-out land for sustainable mining.
In line with the Government of India’s Smart City program and CPSU Solar Scheme, the 10 MW project is developed at the land available at Neyveli at INR 45.29 crore. Green power to the tune of 17 million units is set to be generated annually, conserving equivalent greenhouse gas emissions. Power from this project is set to be supplied for Neyveli Township under the Smart-city scheme. Additionally, it will also cater to the energy needs of the upcoming Green Hydrogen Project at Neyveli.
NLCIL is moving towards a sustainable and reliable future, with a mix of Renewable power generation and stable conventional power generation. We are anxiously awaiting to embrace the next five years with optimism.
Q: NLC India Renewables Limited (NIRL) recently joined hands with Rajasthan Rajya Vidyut Utpadan Nigam Limited (RRVUNL) to establish renewable energy projects. Please tell us more about this collaboration?
Prasanna Kumar Motupalli: With the vision of Prime Minister Narendra Modi, for energy security with sustainable energy generation, under the guidance of Union Minister of Coal and Mines G Kishan Reddy and Minister of State for Coal and Mines Satish Chandra Dubey, and in line with the corporate plan for aggressive capacity addition, NLC India Ltd has entered into Joint Venture Agreements for the formation of two significant Joint Ventures (JVs) with Rajasthan Rajya Vidyut Utpadan Nigam Limited (RRVUNL).
The first JV is signed between NLC India Renewables Limited (NIRL) and RRVUNL to establish renewable energy projects in the state of Rajasthan and to the tune of 2000 MW. The second JV is between NLCIL and RRVUNL for the development of a Lignite-Based Thermal Power Station.
In both the Joint Ventures (JVs), NLCIL will hold a 74 percent equity stake, while RRVUNL will hold 26 percent. These JVs mark a significant step towards advancing sustainable energy and power generation.
Q: Could you share details on the ‘lignite-to-methanol’ project and its impact on natural gas usage and the reduction in LNG imports?
Prasanna Kumar Motupalli: The lignite-to-methanol is an interesting & essential diversification measure in the present context for Net Zero mission through just transition. Because of their high oxygen content in the form of moisture, direct liquefaction of lignite by various hydrogenation processes requires more hydrogen than required to liquefy bituminous and subbituminous coal. Lignite might be considered, therefore, as a more suitable feedstock for gasification and indirect liquefaction.
Methanol plant of 0.4 MTPA/1200 MTPD capacity is proposed at Neyveli. 1200 MTPD Methanol will replace 1.5 MMSCMD Natural Gas and will annually save INR 1000 Cr. of LNG import with indigenous source. The estimated capital cost is INR 4,400 Crore, with expected commissioning by FY 2027.
The process involves converting lignite into syn-gas first and then converting that into methanol. This initiative is set to meet the future energy needs of the country and also to achieve the govt. target of coal gasification of 100 million tonnes (MT) coal by FY 2030. The adoption of gasification technology in India will revolutionize the coal sector, reducing reliance on imports of Natural Gas, Methanol, Ammonia and other essential product. Currently, India imports approximately 50 percent of its Natural Gas, over 90 percent of its total Methanol consumption and around 13-15 percent of its total ammonia consumption to cater to the domestic demand. It will contribute to India’s vision of becoming Aatmanirbhar and create a surge in employment opportunities.
The implementation of coal gasification is expected to make significant contributions to the nation’s development by reducing imports by 2030.This initiative holds the potential to alleviate the environmental burden by reducing carbon emissions and fostering sustainable practices, contributing to our global commitments towards a greener future.
Q: From shipping to Sustainable Aviation Fuel, the potential of methanol seems huge. What are your views on using methanol as a transportation fuel? What are the challenges and how can those be mitigated?
Prasanna Kumar Motupalli: The transportation sector stands at the forefront of global challenges, where its significant contribution to greenhouse gas emissions and air pollution has become an urgent matter demanding immediate attention. For addressing these compelling concerns and leading the automotive industry toward a sustainable future, it is, therefore, imperative to explore the realm of alternative fuel that can effectively mitigate the environmental impact of automobiles.
Methanol, a renewable alternative fuel, has gathered quite attention due to its potential to be used as a wonderful alternative to neat gasoline in spark ignition engines. However, some core challenges must be addressed to utilize methanol on a commercial scale in the transport sector. These core challenges include cold start issues, enhanced NOx emissions, 100 percent methanol utilization, transportation concerns and lubricant oil deterioration.
The adoption of methanol, as an alternative to gasoline, will help us achieve some important sustainable development goals, thus fulfilling the promise of a sustainable future for the upcoming world.
Q: Today, India positions itself as the third-largest user of methanol globally, according to you, how can robust methanol infrastructure be established?
Prasanna Kumar Motupalli: Methanol is not only an alternative fuel but a green fuel. The various applications of methanol, ranging from shipping and transport to sustainable aviation fuel, cooking, and as a feedstock for various industrial processes.
India’s journey toward achieving net-zero emissions by 2070 is distinct from that of developed nations. While developed countries have already reached peak industrialization, India must simultaneously develop its industrial capabilities while reducing carbon emissions. Methanol and other alternative fuels will be instrumental in this journey.
As India positions itself as the third-largest user of methanol globally, the importance of establishing a robust methanol infrastructure is vital. Rolling of methanol fuel stations, similar to existing ethanol stations, enables easier access to this sustainable fuel. This would facilitate methanol’s use in various applications, particularly in urban public transport, where rising diesel prices are causing financial strain.
Methanol dispensing vehicles, aimed at delivering methanol to large kitchens and reducing emissions significantly must be given importance. Methanol has no nitrogen oxides (NOx), sulfur oxides (SOx), or particulate matter, making it an ideal choice for urban settings struggling with air pollution.
There must be an emphasis on global collaboration, bringing together experts, industry leaders, policymakers, and researchers from around the world. The partnership with the Methanol Institute as a knowledge partner underscored the importance of shared expertise in promoting methanol initiatives.
With collective efforts of the government, industry, and academia, India can lead the way in sustainable energy solutions.