The Future of Solar Energy in India

Solar Energy in India

India, with its booming economy and humongous population of over 1 billion, has always faced shortage of energy. Even though the country is among the largest producers of electricity in the world, it is hardly ever able to meet the electricity requirements of its ever-so-rapidly increasing population. At present, almost 53% of India’s energy requirements are met with coal; going by the predictions, the coal reserves of the country will not last beyond 2050. It is common knowledge that over 72% of the population of this third world country still resides in villages, with only about half of its rural population getting access to electricity. It is high time India moved to renewable ways to feed its population its fair-share of electricity.

Solar energy has emerged as the most viable and environment-friendly option for India to cater to the energy requirements of one and all—including the 50% of its rural inhabitants who still live without electricity. A typical solar system is very easy to set up and just entails installing solar panels correctly in order for it to work. Quite a few people were already aware of its benefits and were really quick at setting their properties up with solar systems; in fact, the utilization of solar energy in India is nothing new and has existed in select locations for quite some time now. However, it has yet to pick up steady momentum.

The future of solar energy

The future of solar energy in India is as bright as that of the sun the solar systems derive power from. A brief overview of why India will definitely turn to solar power sooner or later is as follows:

1. Geographical Advantage

How long can India ignore the looming threat to its fossil fuel reserves? The geographical location of India is such that it cannot only produce enough energy to meet its own requirements, but also produce enough energy for the entire world! Because it falls in the tropical region, it receives generous amounts of solar radiation all through the year amounting to nearly 3,000 long hours of sunshine. In India, there are top five states which have highest renewable energy capacity where solar modules are able to produce ample amounts of electricity even on overcast days.

2. Upcoming Solar Projects in India
The states of Andhra Pradesh, Gujarat, Madhya Pradesh, Rajasthan, Punjab, Haryana and Maharashtra have incredulous amounts of potential to tap solar energy, owing to their strategic location. At present, the THAR region in Rajasthan is home to some of the best solar projects of the country, generating close to 2,100 GW power. Gujarat houses one of the largest solar power plants in India. Last year saw Indian government has been approved of a master plan envisaging the up gradation of 50 of India’s cities to blossoming solar cities.

3. How to Use Solar Energy in Multiple Applications around You?
One more reason as to why the future of India’s electricity lies inevitably in harnessing solar energy is because of the number of ways in which the radiation of the sun can be put to use—from solar panels that are the backbone of any solar system, solar inverters, solar street lights, solar UPSs, solar fans, solar lanterns, solar cables, solar mobile chargers, solar power conditioning units, solar home systems, solar road safety equipment and solar fencing to even solar CCTV cameras!
solar panels

4. Highly Advantageous at Cheap Cost
It is true that solar panels and solar systems are slightly expensive to purchase, to begin with. It is, however, also true that solar systems once set up help save money, from the moment on! Solar panels usually have a lifespan of around 25 years and are definitely worth the investment in every respect. The use of solar energy to power electrical appliances eliminates any dependency whatsoever on the constant supply of electricity to any place. Solar power is also good riddance of hefty monthly electricity bills for the common man.

5. Employment Prospects
The transition to the utilization of solar energy is an imminent and long-impending one. It is only a matter of time before we see an entire solar sector come up. The persistent problem of unemployment in India will definitely also get better and the unemployed youth will be able to see the light of day with the creation of more and more jobs.
solar job

Even though many people have already taken to installing solar panels in their homes and offices for meeting their energy requirements on a daily basis, there is still a long way to go before India becomes a complete solar nation.

Transforms Market for Rooftop Solar

Sometimes change comes so quickly it takes time to get to grips with it. One such change is now beginning to take hold in India.

Endowed with more than 300 days of sunshine a year, India is making strides towards becoming a global solar superpower. Since 2009, when the country first launched the National Solar Mission, it has installed solar parks on large tracts of unused land across the country.

“But solar parks need land, and land is scarce in a densely-populated country,” explained Simon Stolp, lead energy specialist at the World Bank in Delhi.

“Rooftops, on the other hand, hold huge potential.”

Today, thanks to a new partnership between the World Bank and the State Bank of India (SBI), India’s largest bank, the market for rooftop solar has also begun to take off.

“Tapping the rooftop solar market will be essential for India to meet its massive energy needs,” said Stolp. “The country has a lot of catching up to do – its per capita consumption of electricity is less than one third the world average.”

To meet these energy needs, India has set itself the ambitious target of generating 100 GW of solar energy by 2022, forty percent of which is to come from rooftop solar.

Getting the Financing

Until now, however, it was difficult to breakthrough into the rooftop solar market. Although the business case was strong, and the costs of solar panels were falling dramatically, financing was difficult to come by.

In solar plants, the largest capital investment goes toward the installation of solar panels, and must be made upfront. At today’s prices, this amounts to an investment of about Rs. 5 crores (approx. $ 760,000) to produce one megawatt of power. “But banks had no models for such new forms of lending, “explained Stolp. “And even where financing was available, the costs were just too high.”

Overwhelming Response

Things have now begun to turn around very quickly. Since June 2017, when the World Bank announced a $625 million loan to SBI to provide discounted finance for rooftop solar installations on factories and institutions, market response has been overwhelming.

In the past six months alone, SBI has approved 575 MW of rooftop solar installations, giving a huge boost to India’s nascent solar rooftop program.

“SBI has developed financing models that will provide loans at a very competitive pricing with long tenor,” explained Karnam Sekar, Deputy Managing Director, SBI. “Several capacity building measures and awareness programs are also being undertaken to sensitize operating functionaries.”

The Early Movers

One of SBI’s first borrowers was Amplus Energy Solutions, a private renewable energy developer, and an early mover in the field. “World Bank-SBI financing has enabled us to borrow at 8.25 percent – down from 12 percent before,” explained Sanjeev Aggarwal, MD of Amplus. “This has helped us lower the cost of solar energy we provide our customers.”

Today, Amplus has around 250 megawatts of solar plants – either installed or under construction – serving more than 70 customers across 20 states of India.

One of Amplus’s first customers was the India Yamaha Motor plant in the Noida industrial belt, across the river from Delhi. The motorcycle manufacturer first began installing solar panels on its Noida rooftops in 2016 to comply with the company’s global energy policy.

Today, Yamaha’s Noida facility is one of the largest manufacturing plants in India with a ‘captive’ solar rooftop facility of more than 20,000 solar panels which generate 6.3 MW of power.

Using Green Power in Manufacturing

The sea of solar panels on Yamaha’s rooftop is owned by the developer. “We buy clean solar power from Amplus at Rs.6 per unit – compared to Rs. 8.5 per unit from our usual energy provider,” explained Sanjiv Paul, senior vice president at Yamaha Motor India.

“This has reduced our power costs by 20-25 percent.”  During peak times, solar power meets a fifth of the Yamaha facility’s energy needs and, on holidays, the energy is fed back into the grid, creating an energy credit that the company can draw upon later.

The change is now beginning to catch on. While large multinational companies have begun to blaze the trail, others are lining up to follow.

“Until now, it’s been a hard sell, because changing mindsets takes time,” said Amplus’s Aggarwal, “But now I think the market is ready to take off. There may be blips in between, but I expect that in 3-5 years’ time the cost of rooftop solar power will fall to Rs. 2 to Rs. 3 per unit.”

“After all,” Aggarwal adds, “This is the first time in history that every person can generate her own clean renewable electricity – be it the smallest tea shop or the largest factory or institution.”

With strong sunshine beating down on rooftops across most of this tropical country, the future of solar power in India is bright indeed.

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