Future Of Energy Is Solar And It Is Here In India
Realising the great potential of renewable energy development, Narendra Modi made a quantum jump (from Megawatt to Gigawatt) and scaled up the target of developing renewable energy to 1.75 lakh MW by 2022 (solar energy = 1.00 lakh MW, wind energy = 0.6 lakh MW, biomass = 0.10 lakh MW and micro hydel = 0.05 lakh MW)
Realising the importance of developing solar power, the UPA government had set up the National Solar Mission and set the target of developing 20000 MW of solar power by 2020. Investors started setting up solar power plants with low capacities i.e. 5 MW to 40 MW. Gujarat government installed solar panels on the embankments of the canals. Somehow, the euphoria was not developed but the progress at a slow pace was set in motion. NTPC was made the coordinating agency to purchase power from the power producers and add to the national grid. Till now 3.5 GW (3500 MW) of solar power plants have been installed and a large number of projects are in the pipeline. China has developed 13.0 GW and Japan 7.0 GW so far.
Two important feature of solar energy development came out in the fore
- It has become widely known that the gestation period of installing solar power plants is very small as compared to those of thermal and hydro power plants. The power company of Anil Ambani set up a 40 MW power plant near Jaisalmer (Rajasthan) in 125 days. Now Madhya Pradesh government has gone a step further to set up a 750 MW solar power plant (largest in the world so far) and commission it by 15.08.2015 within a period of five months. It will be a big event and India will become the undisputed pioneer in the field of solar energy development in the world.
- Uncultivable lands in the states of Rajasthan, A.P. and M.P. will now be in great demand for installing solar power plants. These barren areas will see a lot of economic activities in future and may become the hub of industrialisation and urbanisation both in place of dull and dreary land scapes.
Realising the great potential of renewable energy development, Narendra Modi made a quantum jump (from Megawatt to Gigawatt) and scaled up the target of developing renewable energy to 1.75 lakh MW by 2022 (solar energy = 1.00 lakh MW, wind energy = 0.6 lakh MW, biomass = 0.10 lakh MW and micro hydel = 0.05 lakh MW). The five reasons are as below:
- For fear of climate change, there is a tremendous pressure from the international community to put more reliance on renewable energy and reduce the use of fossil fuels to meet energy requirements. Even otherwise thermal power plants produce a huge amount of air pollution and carriage of coal from mines to power plants has became a big problem.
- Among all the renewable resources, solar energy provides the maximum energy security in future. This is because India gets three hundred clear sky days and maximum intensity of solar radiations in Rajasthan. Above all, it is an inexhaustible source of energy.
- The cost of generating solar power is now close to the cost of power generation from conventional sources.
- Development of solar energy for its triple use (cooking, heating and power generation) can provide 10 million jobs by 2022.
- Gestation period for a solar power plant is very small as compared to those of thermal or hydro power plants. A 1000 MW power plant can be installed and commissioned in nine months provided all clearances are set in place and financial closures for the project have been achieved.
The target of developing 1.0 lac MW by 2022 has been further split into two sub targets, i.e. 60 GW from solar farms and 40 GW from roof tops. Development of 60 GW in next six years is achievable but the same cannot be said about the second part. (Reason described in the next para). This is because the euphoric sentiment for setting up more solar power plants by the private sector is developing fast. Adani Group is now in talks with Rajasthan government to set up a 1000 MW power plant in that state. The Ministry for renewable energy is identifying areas to set up solar farms. Bloomberg has twitted that India has become the front runner country to develop solar energy and a beacon light to other nations in this field.
Installation of 60000 MW in a period of six years is achievable as 10 efficient power producers can install one 1000 MW power plant per year each to accomplish this job with great felicity. They are now lining up for prequalification by the Ministory of Renewable Energy in response to its advertisement circulated recently.
Development of roof-top solar power is a different ball-game altogether. The government has set a target of 40 GW in next six years or 6.7 GW per year. This programme will have to be split into two parts, i.e. 20 GW to be developed in institutional areas (both commercial and non-commercial) and 20 GW on individual house roof-tops. Institutes (commercial, non-commercial and housing societies) can provide sufficient area to generate 20 GW. But it will be a difficult proposition to develop 20 GW on house-tops. This is because each individual may hardly offer roof-top area to generate more than 2KW solar power. So you require, one crore houses (500 x 20000) to generate 20 GW. Moreover, the cost of generating 2 KW power varies from Rs.2.5 lakh to Rs. 4.5 lakh and guidelines for availing 15 per cent subsidy are not clear. Consequently, achievement of this target is doubtful. However, private power producers have started requesting big institutions to allow them solar power plants at their cost and charge solar power @ Rs.7.5 per unit. Presently, there are not many takers but this campaign may catch up if the government makes it compulsory for every institute to set up solar power plants of specified capacity in proportion to its power load.
But the things are not as simple as they look out to be and the challenges in meticulous execution of this projects are many and described below briefly:
- The first challenge before the Ministry is to prequalify only highly competent agencies to do the job. Delhi Metro Railway Project (DMRC) is an undisputed success story simply because of the right selection of executing agencies and the Ministry needs to emulate that example.
- The Ministry has to keep itself abreast of latest cost effective technologies to develop solar energy and dove-tail these technologies in its future programme. To take up a gigantic project of developing 1.00 lac MW solar power, the country needs to establish a big research base which presently does not exist at all even on a minor scale. Hence, a collaborative effort is needed with international universities in this regard. Japan is equally keen to develop as much solar energy as possible in the shortest possible time and the two countries need to collaborate in this field.
- The most formidable challenge is to ensure the availability of land to the power producers before the signing of tender documents. 1.0 MW of solar power plant requires 5 acres of land for its farming. 10000 MW capacity power plants will require a land bank of 50000 acres per year. International investors will not be able to come and have direct negotiations with the farmers for the purchase of lands. Therefore, the states will have to take this initiative to provide or arrange hassle-free land to the power producers. Rajasthan government has taken the right initiative in this regard. It requisitions the land from the farmers on lease-hold basis and hands over to the investors for a period of 25 years, i.e. the duration of the power purchase agreement. Consequently, ownership of land remains with the farmers.
The definition of the term “Farming” too has been extended to include solar farming to off-set the need for obtaining the change in land use pattern (CLU).
- The state governments will have to lay the basic infrastructure works towards the identified solar farms to help the power producers execute the projects as quickly as possible. The infrastructure works will include new rail, road, water supply lines and other similar facilities together with setting up a small airport nearby. New small industrial township will also have to be set up to provide housing facilities to the workforce. Rest will be done by the investors. You can not simply hand over a piece of barren land to the investors and ask them to install 1000 MW power plant within nine months.
- Adding 10 GW (Gigga watts) of additional capacity every year will require an investment of Rs. 80000 crore. The state governments will have to tie up with the banks to create facilities for seeking heavy loans at reasonable interest rates (Priority Sector Landing) to ensure early financial closures by the power producers. Many projects have been stuck up for want of early financial closures. Presently, banks are feeling shy to grant loans to power projects because state/ power utilities have failed to make regular payments to the power producers. Therefore, to make the project bankable, NTPC will have to fix a minimum price for purchase of electricity from the private power producers and ensure timely payments for the power purchased. Many investors quote low rates for the sale of power and abandon the project in the mid-stream. The price formula (like DGS & D) can be revised bi-annually. The Central Budget has already provided facilities for MAT reduction and also waived custom duties on 22 items. Investors will come flocking to India only when they get a remunerative price for their produce with surety of regular payments.
- There is a clause in the power purchase agreement that the investors will have to provide 50 per cent solar panels manufactured in India for the success of “Make In India” programme. Presently, the existing factories will not be able to cope up with the demand and the manufacturing base needs urgent expansion. Therefore, Government of India or state governments will have to provide well developed industrial plots to enable the investors to
broker with the manufacturers to set up their solar panel plants within the country.
- NTPC cannot purchase the entire power and sell it to consumers at subsidised rates. The right approach would be to consume the solar power within the state and within the day time to minimise the line losses and also to reduce the cost of storage of power. This calls for the positive role of state power utilities. Presently, power utilities in most states are under heavy debts because of non-realisation of electricity charges from the consumers, particularly the villagers. Many companies had to stop the power supply when the power utilities failed to make timely and regular payments. Therefore, developing a full-proof mechanism for timely payments to the power producers is a very big challenge for the state governments and the Government of India will have to develop a national policy in this regard.
- The Ministry of Renewable Energy has set it jumbo target only on one aspect of development of solar energy, i.e. power generation. The other two uses, i.e. water heating and cooking, are equally important for the economic growth, employment generation and energy security of India. If cooking of foods in the army, police lines, hospitals, hotels, hostels etc. is done by solar cookers, one can imagine the amount of daily saving of cooking gas. Likewise, if all the electric geysers are replaced with solar geysers in all the cities in India, the saving in electricity will be to the tune of 50000 MW. Therefore, the government needs to set similar target for using solar energy for cooking and water heating purposes. Presently, this aspect is almost neglected. Complete revolution in development of solar energy in India will come only if we make maximum use of solar energy for cooking, heating and power generation. Use of solar energy for cooking and heating is more beneficial than power generation because of very low investment and high grade of employment generation.
By RN Malik