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Home » Industry Analysis » Solar PVs get a push with upcoming policies

Solar PVs get a push with upcoming policies

March 26, 2021 2:14 pm

Solar PVs get a push with upcoming policies
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Industry’s solar PV providers discuss various aspects that can increase the present solar share in India. They also discuss the possibilities a challenge to achieve the set target. 
Owing to the huge demand for energy consumption and electricity upsurges, countries worldwide are increasing their power generation capacity by installing new power plants or expanding the existing plants. Since the government’s stringent regulation regarding carbon emission is also a thought to be pondered upon, the energy sector is inclining to use renewable energy. Major economics around the globe is hugely focused on increasing power generation from renewable sources. Solar is a clean and abundant renewable source of energy that has the ability to meet the environmental challenges of the world. Several new solar industry projects are developed as a result of supportive government policies and incentives. The policies such as feed-in tariff, net metering and investment tax credits are fueling solar adoption. 
Target of 40GW solar rooftop by 2022
Under the National Solar Mission initiative, the government aims to promote solar power with the generation target of 40 GW rooftop solar projects by 2022. Government claims that micro, small and medium enterprises can contribute nearly 16 GW of rooftop solar power by 2022. This forms almost 40 percent of the 40 GW target. The central government and state nodal agencies provide subsidy schemes for installing solar rooftop systems. Siddharth Gangal, Founder & CEO Panel stack, Solar Labs said, “Under this scheme, 30 percent of the benchmark installation cost for solar rooftop will be paid by the central government for the states falling under the general category. The states in the special category are applicable for subsidy even as high as up to 70 percent.” Consumers are eligible for a generation-based incentive, thereby entitled to receive `2 per unit of electricity generated. Under the net metering billing mechanism, consumers can sell excess electricity generated to the utility. They would be receiving a regulated cost per unit according to the government set tariffs. Manoj Gupta, VP-Solar and Waste to Energy Business, Fortum India Pvt Ltd says, “We believe that the government is working towards the requisite steps and initiatives to generate the intended capacity of 40GW of solar through rooftop or off grid solar projects by 2022. The major contributor to achieve this target will be through KUSUM scheme.”  
In a recent announcement, our Hon’ble Prime Minister, Shri Narendra Modi, emphasized that the government aims to produce 40 gigawatts (GW) of solar power in the next one-and-a-half years through rooftop solar projects. He also added that renewable energy capacity enhanced two-and-a-half times in the past six years, while solar energy capacity increased by 15 times. Gupta adds, “Referring to the production-linked incentive (PLI) scheme, Prime Minister, Modi mentioned that high efficiency solar PV modules were now part of the PLI scheme, and the government was committed to invest `4,500 crore in it.” Additionally, in this Budget the government had announced additional capital infusion of `1,000 crore in Solar Energy Corporation of India and `1,500 crore in Indian Renewable Energy Development Agency. With these measures and investments in place, we believe that the government will work towards achieving the targeted capacity.
10,000 MW capacities integrated solar PV manufacturing plants being operationalised under the PLI scheme
The government aims to reduce import dependencies by awarding ‘performance linked incentive’ (PLI) to solar panel manufacturers. The country’s solar projects are majorly dependent on the solar panel’s import. “The cabinet’s approval of `4,500 crore for ‘High-efficiency solar PV Modules’ is likely to boost domestic production. MNRE claims that preference will be given to local products for sufficient local capacity.” Gangal explains MNRE has also proposed a Basic Customs Duty (BDC) of 20 percent on solar cells and modules imported. Under the PLI scheme, the government plans to achieve integrated solar PV manufacturing units with a total of 10 GW capacity. The demand for materials like solar glass, EVA sheets, junction box and back sheets is likely to increase. By incentivising the domestic manufacturers to build large scale solar projects in India, the country aims at strategically capturing a significant share of the global value chain for solar PV manufacturing.
Dr. Chetan Solanki, Energy Scientist, Professor – IIT Bombay says, “The context comes from the policy, and particularly towards the subsidy; and I believe that the solar after 50 years of existence has matured enough to stand on its own without any subsidy. however, governments are willing to promote it. But the kind of money allocated by the government to promote the solar sector won’t be sufficient. With the kind of progress, we are expecting in solar sector we actually need tonnes of money which the governments are never going to have. So therefore, this small money that they throw out actually disrupt the market and therefore becomes a borderline possibility to achieve the target. I request all the governments to stop the subsidy immediately. Me being the Brand ambassador for solar energy of Madhya Pradesh, have reached out to the chief minister of Madhya Pradesh to do that, hopefully some action be taken.” The PLI scheme will help in the growth of opportunities for local PV manufacturers as the cost of imports will decrease. The scheme is likely to boost demand for locally produced materials like EVA sheets, solar glass, back sheets, and junction boxes. Gupta adds, “This will help Indian companies become global manufacturers. The PLI scheme is to boost up the manufacturing with new and latest technology trend. If local manufacturers succeed to be in line with global technologies then it will be a game changer for domestic solar industry.”
PLI scheme’s benefit to the local solar PV production
According to industry stakeholders, the lack of financing incentives is holding back the growth of domestic solar components production. This might change soon as a result of the central government’s PLI scheme that allocates `1.45 trillion to ten critical sectors, solar PV modules being one of them. Implementing high-efficiency solar modules under the PLI scheme will reduce solar imports, boost domestic solar panel manufacturing, aid in turn job creation, and attract investments in the sector. Gangal says, “This will also ensure that the complete renewable sector value chain is based out of India by making domestic manufacturing self-sufficient and promoting exports. By providing great incentives for manufacturers, the PLI scheme helps the country move towards its objective of ‘Atma Nirbhar Bharat’ (Self-Reliant India).” This scheme will make Indian manufacturers globally competitive by building on their strength and linking with the global value chains. Thus, the PLI scheme provides necessary encouragement and support from the government to the sunrise sectors’ local production. 
“As a part of energy swaraj movement, we ask people to surrender their electricity connections. The moment I give away my electricity connection, I become a disciplined user of electricity and become localised. Also, I reduce burden from the grid and enable the government to reduce imports and spend less on the exchange. Even the entire world can start following the order and we can see the difference in the percentage of global warming. If the world start enacting upon this idea slowing and gradually, we should be able to be to be successful in dealing with the environmental challenges too.” Solanki adds, Big imports of solar PV panels present high risks in supply-chain resilience and have strategic security bottlenecks taking into account the electronic nature of the value chain. Domestically manufactured module would always be a preferred choice for rooftop solar due to the routine and preventive maintenance of the plant. Gupta conclude, “Warranty claims will also be easier with domestic module supplier. A focused PLI scheme for solar PV modules will incentivise domestic and global players to build large-scale solar PV capacity in India and propel local manufacturers in India to capture the global value chains for solar PV manufacturing.”
Solar Energy’s share will be at par with the coal-fired power generation by 2040
The Indian electricity sector is currently dominated by coal. The government has taken several measures to push the increase in green energy use. The nation added solar capacity almost five times in 2019 as it did in 2015. India will be adding a renewable capacity of 900GW over the period to 2040. Solar and wind will account for more than three-quarters of this growth. Batteries will be contributing a lot to the development. As solar power generation fluctuates in nature, the solar system paired with battery storage is an appealing solution. Solanki explains, “Second, important issue is the provision of free and subsidised electricity. This is one of the critical bottlenecks because the cost complications of solar are highly competitive. I think rather than giving subsidised electricity, let us provide them the benefits of direct benefit transfer to the people. Government can make a provision direct transfer of a particular sum amount every month which will let them pay for the electricity consumed. This will let us save a lot of things in response.  Discussing the same, Gangal says, “Further, the utilisation of coal plants has fallen from more than 70 percent in 2010 to 55 percent in 2019. In an effort to tackle air pollution and diversify the energy mix, the plummeting costs of renewables have contributed to lower expectations from coal-based sources in India. The government’s recent budget addresses the need for technology along with the creation of research funds. With the globally developed technologies made available for India’s clean energy transition, coal’s future in the power sector looks particularly not-so-promising.” 
Gupta on the other hand says, “Looking at the growth various government initiatives and schemes, we are of the opinion that solar energy’s share will definitely grow in the coming years. Additionally, MNRE is trying many business models to achieve long term goals and I am sure that these new business models will definitely bear fruits and help achieve long-term goals.”
 Every individual and every household should become independent. The day we cut down our dependence on the government or the companies to meet our energy requirements, that will be the day when we can proudly say that the energy swaraj mission is becoming a reality.
Catering to the quality and cost complications
Gangal says, “We at Panelstack (formally SolarLabs) enable solar installers to design and sell more solar to customers at a fast pace. The software involves doing a detailed analysis of the customer’s rooftop remotely and developing an optimal design. Installing solar rooftops requires a 3600approach and significant time investment in activities like site inspection, design iterations etc. and is mostly riddled with manual processes and legacy patchy softwares. Our cloud-enabled SaaS suite aims to automate this process, thereby reducing the time and cost of installation. The solar analysis and installation processes are automated, making the entire process efficient and error free. We’re building a platform that helps solar installers and developers design more optimised solar PV systems, increase energy yield per panel installed, reduce cost of installations and create quotations and reports for clients with just a few clicks in less than 20 minutes.” The software is being developed with a mission to make solar energy easily accessible and more affordable. Our platform has been used to estimate 1200 MW+ of solar capacity globally and serves some of the largest companies in the world including Tata Power, Adani Solar, Renew Power and hundreds of small & medium solar companies spread across 20+ countries. When we succeed, the solar industry wins, and the world wins. Gupta says, “Fortum is also part of the growth journey of Renewable Energy in India and is close to reach around 900 MW of Utility scale solar project installation. We further plan to install around 300-400 MW solar plant every year. During Covid situation also we are trying to ensure the quality and competitiveness of the modules because Fortum believe in long term relationship with our supplier and for our ongoing projects also we maintained our earlier supplier, same EPC company etc. So, if you have a strong bonding with your supplier then you need not to worry.” 
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The day we cut down our dependence on the government or the companies to meet our energy requirements, that will be the day when we can proudly say that the energy swaraj mission is becoming a reality
Chetan Solanki, Energy Scientist, Professor – IIT Bombay
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By providing great incentives for manufacturers, the PLI scheme helps the country move towards its objective of ‘Atma Nirbhar Bharat’
Siddharth Gangal, Founder & CEO Panelstack, Solar Labs
____________________________________________________________
MNRE is trying many business models to achieve long term goals and I am sure that these new business models will definitely bear fruits and help achieve long-term goals
Manoj Gupta, VP-Solar and Waste to Energy Business, Fortum India Pvt Ltd
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