Fossil fuels out, efficiency in

Shashi Shekhar, Advisor, EI Dupont Clean Technologies, USA

“India needs to step up quickly and build broad base of solar manufacturing, given its high ambition for solar by the year 2022 if these are here to stay”

Shashi Shekhar, Advisor, EI Dupont Clean Technologies, USA, says that the share of renewable energy in India’s electricity mix is set to increase to around 55 per cent by 2030, as India continues to expand its installed capacity in the face of growing power demand. Shekhar shares his knowledge on the recent developments, initiatives and shortcomings in the energy sector.

India’s contribution to renewable energy

Well, the correlation has been truly established between the advancement in power sector and India’s economic growth. However, today, the power sector stands at an all important juncture and crossroads, which we will determine the path ahead for may be next few decades. Not long back, thermal power sector was considered to be the backbone of the economy, but gradually, we have started to witness the huge financial distress and delay in project implementation resulting into cost overruns. The recent focus, which is all the need of the hour from the government to focus more on renewable energy, has altogether opened the new avenues for power sourcing. India is gradually moving and strengthening its position as the top player in implementation of renewable energy. As part of Paris Climate agreement, India has committed to ensure 40 per cent of its installed electricity capacity based on non-fossil fuel sources by 2030. It is believed that the share of renewable energy in India’s electricity mix is set to increase to around 55 per cent by 2030, as the country continues to expand its installed capacity in the face of growing power demand. But, more importantly, the balance needs to be struck correctly where ambition meets reality. We have to correctly estimate how much power could be actually absorbed in the country and work around that. There are already concerns of excess capacity, energy demand, and implementation of the plan, which also involves core issues of financing, land acquisitions etc. In these entire future and aggressive growth plans, the stressed assets in the power sector shouldn’t be left unattended and unresolved.

Electric power efficient than combustion

If fossil fuels are done away with, then there would be massive efficiency increase in every sector. A large chunk of energy is used to mine, transport and refine fossil fuels. So removal of fossil fuels immediately provides substantial savings. Electric power is more efficient than combustion. An electric vehicle uses approximately 80 per cent of the energy in its battery to move the car, with the rest lost as heat waste. Petrol powered car uses approximately 15-20 per cent of its energy to move the car, with the rest lost as heat waste. So, the automobile sector itself could witness massive growth in terms of efficiency.

Revolutionary policies

There have been many policies and initiatives, which have been announced or shaping up. But, one such policy has been the announcement of Renewable Purchase Obligations (RPOs). RPO is the single most important policy driving renewable energy installations in India towards achieving its aggressive goal of installing 175 GW by 2022, with solar comprising 100 GW of this portfolio. Most of the states have fixed RPO targets. But, due to the lack of RPO regulations being enforced and the absence of penalties/fines when obligations are not met, many of the state DISCOMs continue to miss their targets. RPO refers to the obligations, which have to be met as part of their electricity consumption from renewable resources. For ensuring maximum use of renewable energy, government levied obligation to firms/companies for purchasing minimum number of units produced through renewable sources. The entity is even allowed to produce or possess their own plants for meeting the requirement or they can directly purchase the RECs from other company or firm involved in producing energy through renewable sources. To meet this target, this policy needs to be seriously considered and focus should be there on all times to evaluate the progress.

Benefits of solar-powered irrigation

Farmers in India play the most significant, role which is evident from the fact that agriculture in India contributes to 15 per cent of the GDP and employs 50 per cent of the country’s workforce. Reliable and consistent irrigation, therefore, is the most important requirement not just for the farmer, but also for our nation. Irrigation in India today is almost entirely reliant on electric and diesel pumps. Of the total irrigation pumps in use throughout the country, about 60-70 per cent run on grid electricity, 20-30 per cent is powered by diesel. These pumps attract lower CAPEX, but their operation depends on the availability of diesel fuel or a regular supply of electricity. So, the right substitute we have for these are in the form of solar-powered pumps. A study shows that replacing 100 per cent of all agricultural consumption in the next five years would require a total solar PV installed capacity of close to 150 GW. For India to come any closer to the target of 100 GW of solar energy by 2022, the major portion of traditional water pumps should be replaced by solar water pumps. The shift to solar-powered irrigation pumps can save high volume of money and generate additional income for farmers along with protecting groundwater. Initially, the capital cost of solar pumps could appear to be on the higher side, but gradually the benefit would be witnessed in the form of lower operating expenses. The government is doing its part in encouraging the deployment of solar pumps on a very large scale in rural areas with incentives. Therefore, focus should be shifted towards deep penetration and highlighting the advantages so that it becomes a norm and acceptable mode of irrigation soon. I truly believe that these solar pumps could be the right medium to fill the void in terms of solar installations, which we are seeing in the rooftop segment.

More to be done by governments

There are very slim chances of national solar mission meeting its target unless the entire solar ecosystem is managed well. The uncertainty around the policies and regulations has completely taken over, which in turn is affecting the investor sentiments. There has to be clarity and stricter guidelines around DISCOMs signing PPAs with solar plants. A lot needs to be done around the imposition of safeguard duty where in developers should be given the clarity around their existing projects.