The little village of Awan, 40 km from Amritsar, in Punjab, finds pride of place in the Indian solar map too. Earlier, it used to face severe shortage of electricity and peak gaps at 11% hampered industrial growth and competitiveness. In July 2009, a 2 MW grid-connected solar power plant became operational, supplying power to 20,000 people in 32 villages, thereby generating income and more reliable power for the local community without increasing carbon footprint. The Punjab plant has been helpful in eliminating carbon dioxide emissions equivalent to 5,50,000 trees or removing 3,600 cars from Indian roads, says Inderpreet Wadhwa, founder & CEO, Azure Power, an independent power producer. The company has built Indias first privately owned utility-scale solar power plant in Awan.
Down south, the magnificent Vidhana Soudha in Bangalore is not just the seat of power in Karnataka, but is also a landmark close to the heart of every Bangalorean. The newly constructed South BlockVikasa Soudha, a replica of the Vidhana Soudha has a 100 kWp solar power plant on its rooftop. It provides power to satisfy the energy requirements of the building and housing facilities of the government offices.
Clearly, the sun is a massive reservoir of clean energy and seeds have been sown for a large solar energy sector in the country.
Solar power remains the brightly promising spot in the field of renewable energy, and its prospects seem to be improving by the day. For the industry, solar presents significant investment opportunity. Investment opportunities across the value chain from manufacturing to engineering, procurement and construction (EPC) to project development exist with an estimated total project investment of $110 billion over the next decade.
There are 1,25,000 villages in India that are deprived of electricity. And because some are remote, in hilly terrain, and have low populations, they cannot be served by conventional grid-based power. Solar solutions are very effective for decentralised electrification and with government incentives this sector is likely to grow in many folds, says K Subramanya, former CEO, Tata BP Solar. Solar water pumping for irrigation can be a boon and trend-setter with supportive policy framework. A lot of street lighting can migrate to solar and relieve the grid of peaking problems, he adds.
As one looks to the future, India faces significant challenges of energy security, responding to the call for action against climate change and importantly addressing the issue of inclusive growth within the country. Our coal import requirement is expected to exceed 30% of our coal demand by 2017; India will need to show some action towards its voluntary target of 20-25% reduction in carbon emission intensity of GDP by 2020; and look at ways to electrify over 40% of rural households with reliable electricity.
According to a KPMG report, solar power has the potential to meet almost 7% of our power needs by 2022, mitigate 2.6% of our carbon emissions in that year and save over 71 MTPA of imported coal in that year (equal to $5.5 billion of imports). In this backdrop, the thrust on renewable sources of energy is a step in the right direction. The Prime Ministers National Action Plan on Climate Change (NAPCC) envisages meeting 15% of our power requirements from renewable energy sources by 2020. One of the eight missions under the NAPCC is the Jawaharlal Nehru National Solar Mission (JNNSM) which was launched in late 2009. The mission targets 22,000 MW of solar power by 2022.
In addition, 21 states are pursuing their own programmes, notably Gujarat and Rajasthan which have undertaken concrete steps to support the programme at the State level and have attracted the largest inflows of investment.
However, the future of solar power in India will not be easy. Although the government has promised support, several steps have to be taken to meet the aspirations of the National Solar Mission. First, JNNSM comes with an estimated $19 billion cost, and the government has committed to funding $900 million for the first phase. Subsequent phases will require additional funding commitments. Second, streamlined project allocation and development in line with the gestation period of such projects will be needed to encourage new age developers to enter the market for rapid capacity build up.
For the JNNSM 2020 to succeed, policy makers will have to view solar power generation from a developmental perspective, reckons Wadhwa of Azure Power. A consistent, predictable and long term regulatory environment is the key for development of the solar power generation in India. We must have clear and long term visibility on solar feed in tariff in India, he stresses.
Theres no denying it, more needs to be done and at a faster clip.