Replicating the German model will help India meet its generation target
India is blessed with renewable sources, be it wind or solar. But the big question is their viability. Today, in the country, solar has about 3000 MW of installed capacity, wind has about 21000 MW and biomass about 2600 MW.
The focus on renewable energy began about a decade-and-a-half ago. The wind energy companies were the first to seize the opportunity. Naturally, wind has the largest renewable energy generation share in India. However, it has its challenges, such as large initial capital investment, scalability and non-predictability of wind.
With the government pushing for solar energy through programmes such as JNNSM phase 1 and II, (Jawahar Lal Nehru Solar Mission), roof top solar, net metering, solar city (such as in Chandigarh, Shimla, Nagpur and Kohima); and a solar target of 100 GW by 2022, many players have jumped onto the bandwagon of solar power generation.
Over the last few years solar developers have seen a growth rate of more than 100% on a year-on-year basis. So, while the largest might be wind, the fastest growing in the renewable energy space is solar.
There are some intrinsic advantages that solar power generation enjoys over wind energy. It can be installed at any scale, i.e. you can install a viable solar generation plant at 1 Kw or at a megawatt scale. Additionally, there is a large part of India where solar generation can happen vis–a-vis wind, which is not as predictable and would need a large initial capital investment. Finally, solar generation offers flexibility in design and installation depending on the market conditions.
In Germany, roof top solar has been very successful. If India replicates the German model, it can achieve the target faster as buildings here typically have an area, large enough, for a roof-top unit. Owing to a tropical environment, the country has a significantly higher number of sunny days per year. The problems to overcome here are a clear policy framework and good financing models, which help individuals/organisations in capital investment.
The success of solar can also be seen from the bid results of JNNSM phase II released by the Solar Energy Corporation of India (SECI). The total capacity under this phase was 750 MW and all projects will use photovoltaic (PV) technology.
The lowest tariff in the phase II was R5.45 per kWh ( R4.75 kWh for projects claiming accelerated depreciation (AD) for 25 years. To promote local manufacturing, SECI had invited separate bids under the Domestic Content Requirement category. There was a capacity of 375 MW reserved for the DCR category.
Renewable energy is the need of the hour and it is up to the country to take it ahead. Renewables can give 24×7 power to the whole country. While government is doing its part to provide the initial thrust, it is now upon the individual users and the small and large entrepreneurs to make it a viable option for power generation.
The author is principal, resources, Accenture in India