India’s National Solar Mission is helping create conditions for the rapid scale-up of solar capacity and technological innovation. But although it appears to be going great guns in some states like Rajasthan and Gujarat, it will need greater push and deployment across the country in order to meet its overall objective.
In fact 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, ideal for setting up solar projects, has so far attracted 722 companies for setting up of solar power plants of 16,900 Mw capacity. Rajasthan and Gujarat have attracted the largest investments as their geography and climate are conducive for solar energy radiation. Out of a total 1,100 Mw new project allocations, Rajasthan received a lion’s share of 80% through competitive bidding in the first phase of the National Solar Mission.
But of late, Gujarat has proved to be more than a match to Rajasthan in setting up solar projects in the state. The world’s largest solar power station and a cluster of 17 thin-film solar PV systems, is situated in a single park at Charanka village in Patan district in Gujarat, 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. The state government proposes addition of 1,000 Mw of solar power generation capacity each year for the next three years by creation of solar power generation facilities.
What is it that is goading state governments and private players to create incentives for driving up the scale for solar energy production? In the words of 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 8-11am and 5-8pm—will surge from 124,995Mw now 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% shortage during the peak hours.
Under the circumstances, ramping up solar power capacity appears to be the best bet for bridging the country’s yawning power deficit. 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% of this electricity is generated from coal and lignite, among the dirtiest sources of energy. In contrast, solar energy has the estimated physical potential for meeting 94% of India’s additional electricity needs by 2031-32. And with advances in solar technology, the cost of solar energy is becoming comparable to or less than that of electricity from coal and oil fired generating stations once their externalities and current subsidies are factored in. 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 5-7% per year for the next three to four years.
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In fact 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, ideal for setting up solar projects, has so far attracted 722 companies for setting up of solar power plants of 16,900 Mw capacity. Rajasthan and Gujarat have attracted the largest investments as their geography and climate are conducive for solar energy radiation. Out of a total 1,100 Mw new project allocations, Rajasthan received a lion’s share of 80% through competitive bidding in the first phase of the National Solar Mission.
But of late, Gujarat has proved to be more than a match to Rajasthan in setting up solar projects in the state. The world’s largest solar power station and a cluster of 17 thin-film solar PV systems, is situated in a single park at Charanka village in Patan district in Gujarat, 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. The state government proposes addition of 1,000 Mw of solar power generation capacity each year for the next three years by creation of solar power generation facilities.
What is it that is goading state governments and private players to create incentives for driving up the scale for solar energy production? In the words of 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 8-11am and 5-8pm—will surge from 124,995Mw now 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% shortage during the peak hours.
Under the circumstances, ramping up solar power capacity appears to be the best bet for bridging the country’s yawning power deficit. 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% of this electricity is generated from coal and lignite, among the dirtiest sources of energy. In contrast, solar energy has the estimated physical potential for meeting 94% of India’s additional electricity needs by 2031-32. And with advances in solar technology, the cost of solar energy is becoming comparable to or less than that of electricity from coal and oil fired generating stations once their externalities and current subsidies are factored in. 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 5-7% per year for the next three to four years.
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