The Jawaharlal Nehru National Solar Mission lays out an ambitious vision and a broad framework to make India a world power in the use of solar energy and fixes a formidable target of generating 20,000 MW of solar power by 2022.
Bringing down the capital cost is going to be a challenge in popularising solar power in India. But fortunately, key technologies are evolving fast and prices are also coming down. Solar photovoltaic (PV) has the option of both thin film and crystalline technologies and it remains to be seen which technology will be the most suited for India.
To evaluate the relative competitiveness of the two technologies, the capital cost and levellised cost of electricity generation (LCOE) were calculated for both technologies at current levels of capacity utilisation factor (CUF) and expected CUF improvements by 2012. The fall in prices of crystalline module by 50% has resulted in a drastic capital cost decline from R25 crore/MW to R19 crore/MW. LCOE has fallen from R23 a unit to R16 a unit mainly because of a fall in module price. Future improvements in CUF for crystalline technology are expected to bring down LCOE to R10?12 a unit by 2010, much lesser than LCOE of R16-18 a unit.
Usage of P-Si in modules by weight is also expected to fall substantially from 8 gm/weight to 5 gm/weight by 2015, leading to a further decline in LCOE.
These numbers show that the historical cost advantage that the thin film had achieved over crystalline is closing fast due to P-Si price fall, and thin film technology improvements will decide this technology?s ability to maintain its market share. However, in India, given the comparatively low labour and capital costs and the cost advantages enjoyed by thin film players like Moser Baer in non-solar businesses in thin film (CDs for Moser Baer), there is still scope for this technology to improve upon the market share.
Presently, only solar PV power plants are operational in India while solar thermal exists in some R&D projects in Rajasthan.
Besides, solar thermal is finding extensive usage in remote distributed generation in places like Leh and Ladakh, and in rural electrification programmes being undertaken in Maharashtra, Chhattisgarh and the Northeast. It also finds applications in household appliances like solar water heaters and solar cookers.
CSP (concentrated solar power) concentrates sunlight using mirrors to create heat and then uses the heat to raise steam to drive turbines and generators, just like a conventional power station. Plants have been operating in California, USA, from mid-1980s and lighting up about 100,000 homes.
Plants of capacity of 1 gw are operational around the world with concentration in the USA and Spain, and in some capacities in Italy, Germany and Australia. New plants are now being planned or built in different places around the world.
A working paper by Centre for Global Development, Washington (July 2010) had calculated LCOE from CSP for India, based on the capital costs of CSP plants in Spain, with a discount of 15% to account for India?s lower in-country labour and capital costs.
The LCOE for certain areas in Rajasthan was calculated at R9.4 a unit and assuming a 15% discount, it works out to R8.22 a unit. These figures can be taken as reference for the cost of the technology in India. However, the major obstacle for its adoption in India is the lack of indigenous technology development. So, the extent of adoption of CSP by Indian players will depend largely on technology transfer initiatives.
The writer is the dean of Management Development Institute, Gurgaon. Views are personal