An IIPM Initiative
Sunday, October 17, 2021

Can India rise to the challenge of its solar potential?


ASHISH KUMAR | Issue Dated: November 25, 2012, New Delhi
Tags : Amritsar | India | Azure Power Pvt Ltd. National Solar Mission |

An hour’s drive from Amritsar, the border city between India and Pakistan, lies the village of Awan. At first glance there is nothing that distinguishes this village from others in Punjab. But walk a little farther from the village and you come across the imposing gates of Azure Power Pvt Ltd. The sprawling solar power plant produces two megawatts of electricity and feeds about 20 neighbouring villages. The land for the plant has been obtained on a 20-year lease from the village panchayat. Besides, Azure Power has also created employment opportunities in the village making it a win-win situation for all stakeholders.

Awan's example typifyies India’s growing strides in the field of solar energy generation. If one takes a closer look at the trends over the last two to three years, solar energy production has risen year on year. In the past two years alone, India’s solar power production has grown from 20 Mw to more than 1,000 Mw. Under the ambitious National Solar Mission (NSM), India has jumpstarted its solar energy industry, fostering growth in both photovoltaic (PV) projects and CSP, also known as solar thermal. Before the Mission began, CSP projects only provided 8.5 megawatts of energy. Two years later, large-scale CSP projects now underway in India are all set to provide a projected 500 Mw of clean, reliable energy under the NSM. Given the short time frame of the Mission, these numbers are impressive.

The objective of the Mission is to establish India as a global leader in solar energy, by creating the policy conditions for its diffusion across the country as quickly as possible and reduce the cost of solar energy. The Mission aims to install 20 million solar lights and 20 million square meters of solar thermal panel, generating 20,000 megawatts by 2022. With lots of untapped potential just around the corner, solar can contribute in a big way to our energy security and power development.

Rajasthan alone, which is expected to be the leader in setting up solar plants, can meet India’s total power needs by covering a fraction of its desert with solar panels. The state’s dry and sunny climate has so far attracted 722 companies for setting up of solar power plants of 16,900 Mw capacity. Of a total 1,100 Mw new project allocations, Rajasthan received a lion’s share of 80 per cent through competitive bidding in the first phase of the National Solar Mission. But of late, Gujarat has proved to be more than a match for Rajasthan. The world’s largest solar power station and a cluster of 17 thin-film solar PV systems, is situated in a single park in Patan district, which already has nearly 200 Mw of solar power generation capacity, according to SunEdison, one of the global solar leaders that has set up plants in the state. Other states too are taking the lead. For instance, Tamil Nadu has announced the creation of 3,000 Mw of solar power generation capacity in the state over the next three years. Says Inderpreet S Wadhwa, CEO, Azure Power, “Considering the acute power shortage that the country is facing, solar energy has really high prospects in India. In the days to come, you will only see the scale of production going up, improved distribution and the final cost going down.”

According to the draft of the 18th Electric Power Survey of India, India’s power shortage during peak consumption hours – between 8 to 11am and 5 to 8 pm – will surge from 124,995Mw to 199,540Mw in 2016-17 and 283,470Mw in 2021-22. The power shortage situation is all the more alarming considering that the country’s per capita electricity consumption, at 700 kilowatt/hour, is less than one-third the global average; yet it faces a 10.2 per cent shortage during peak hours.

Under the circumstances, ramping up solar power capacity appears to be the best bet. India’s demand for primary energy is expected to leap from 400 mtoe (million tonnes of oil equivalent) to 1,200 mtoe by 2030, by which date the per capita consumption of electricity is expected to have tripled from its current 660 kWh/ to 2,000 kWh. Currently, 75 per cent of this electricity is generated from coal and lignite, among the dirtiest sources of energy. In contrast, solar energy has the physical potential for meeting 94 per cent of India’s additional electricity needs by 2031-32. And with advances in solar technology, the cost of solar energy is also becoming comparable. Three years ago, when the National Solar Mission was launched, the price of every unit of solar power was Rs 18, which has now come down to Rs 7 per unit. A KPMG India estimate believes that price of solar energy will further come down at a pace of five to seven per cent per year for the next three to four years.

Arvind Mahajan, Partner and Head, Energy and Natural Resources, KPMG India says, “A high-end residential consumer can install a 1 KW solar PV system and reduce his power consumption with a monthly EMI payment of around Rs 2,000 for five years and avoid an average discounted monthly payment of around Rs 1,200 over a lifetime of about 25 years to the grid.” The cost advantage explains why small solar power installations in plush colonies of metro cities and even tier 1 and 2 cities are becoming more visible and popular these days.

But there are many challenges that need to be addressed before one can tap the full potential of solar power in the country. Dedicating large tracts of land for exclusive installation of solar panels poses a big problem as competing projects also require land. The amount of land required for utility-scale solar power plants is about 1 sq km for every 20–60 megawatts generated. This high requirement for land needs to be reduced to make solar energy viable. Kalpana Jain, Senior Director, Deloitte India, points out another important issue. “While the world has progressed substantially in the production of basic silicon mono-crystalline photovoltaic cells, India has fallen short in catching up with the global momentum,” she says.

India now has a historic opportunity to implement policies that can help develop solar energy. What is also crucial is to nurture a complete ecosystem in which generation, distribution and usage of solar energy becomes viable for all stakeholders. That is the only way to ensure the country's energy security and end its chronic power woes.

Rate this article:
Bad Good    
Current Rating 5.0
Post CommentsPost Comments

Issue Dated: Feb 5, 2017