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On a Solar
A look at the
current power
situation and
future of the PV
industry in India

India’s total installed power

generation capacity is approximately
146,753 MW, of which 54% is
coal-based, 25% hydro, 8% is
renewable and the balance is the gas
and nuclear-based. The per capita
power consumption is 632 KWh/year
against the world average of 2,516
KWh/year. Power shortages are
estimated at about 11% of total energy
and 15% of peak energy requirements
and are likely to increase
in the coming years.

48 April, 2009

April, 2009 49

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Solar Energy in India

Fortunately, India lies in sunny regions of the world.
India receives solar energy equivalent of about 5,000
trillion kWh/year, and has about 300~330 sunny days
in a year. Against this huge potential the installed ca-
pacity of solar power (off-grid & on-grid) is just 9.84
MW—a fraction of the total 13,242 MW of renewable
energy installed.
Realizing the potential, various efforts have been
made during the past quarter century and devices such
as Solar Water Heaters, Solar Cookers, Solar
Lanterns, Solar Street Lights, Solar Water Pumps, etc.
have been commercialized. A Solar Photovoltaic Pro- A 10.2 KW residential power plant installed in bangalore
gram has been
run for about 2 Photo by
Installations of Solar Systems in India decades and an
Source Capacity
aggregate 1.3
million systems
Solar Street Lightning Systems 70,474 nos have been in-
Home Lightning System 4,34,692 nos stalled in the
Solar Lanterns 6,97,419 nos country. India’s
Integrated Rural
Solar PV Power Plants 8.01 MWp
Energy Program
Soar Water Heating Systems 2.45 Mn Sq mt of collector area using solar ener-
Box Type Solar cookers 6.37 lakhs gy has served
300 districts and World’s largest solar kitchen in Taleti, near Mount Abu, sit-
Solar PV Pumps 7,148 nos uated at a height of 1,219 m above sea level in Rajasthan.
Source: Ministry of New and Renewable Energy, India
around 2,300 vil-

Policy Initiatives
The current provisions under Electricity Act 2003 of Generation-based Incentives by MNRE
the Government of India, mandates the State Electricity In order to demonstrate the usage of solar energy for
Regulatory Commissions to fix certain minimum per- power generation in the country, Ministry of New and
centage for purchase of renewable power in the area of Renewable Energy (MNRE) announced its guidelines
each distribution licensee. Also the National Tariff Pol- for generation-based incentives for Grid Interactive
icy, which lays down guidelines to be followed while Solar PV Power Generation Plants in January 2008.
fixing tariff for purchase of power, allows for procure- Under this scheme, incentive of up to INR 15.00/KWh
ment of power from non-conventional energy sources is provided for power generated using solar photo-
at a preferential rate. The 11th five year plan of the voltaic technology. This incentive will be distributed
Government of India focuses on Grid Connected Solar between the state government and the central ministry.
Power Generation. Various policy initiatives have been The first level of incentive will be provided by the
taken to promote growth of solar energy. state by way of tariff rate for power generated. The
balance amount (INR 15.00 less state tariff) will be
Future Policy Initiative provided by the central ministry.
The maximum capacity to be supported under this
National Solar Mission program is 50 MW, with a state level limit of 10MW.
The National Solar Mission, as part of India’s first The power generation plant is to be commissioned by
National Action Plan on Climate Change (NAPCC) December 31st, 2009, after which the incentive will
was announced by the Prime Minister, Dr. Manmohan reduce by 5%.
Singh. The plan includes:
•A goal of increasing production of 1,000 MW/year State Level Incentives
•A goal of deploying at least 1,000 MW of solar Encouraged by the initiatives taken by MNRE for
power generation, promotion of grid interactive solar PV power plants,
•Specify goals for increasing use of solar energy in various states have announced preferential tariffs for
urban areas, industry and commercial establish- purchase of power from these plants.

50 April, 2009
Photo by

Development of Solar Cities. The major activity in-

cluded under this is Preparation of Master Plan that
will set the goal for reduction of minimum 10% in
total demand for conventional energy at the end of
five years to be achieved through energy saving from
energy efficiency measures and generation from re-
newable energy installations.
The target set to be achieved in the next 5 years is
60 cities, with at least one city in each state. A list of
15 cities has been approved as of now under this
These include :
Solar streetlight installed outside a temple in Tamil Nadu. Agra (Uttar Pradesh), Rajkot (Gujarat), Moradabad
(Uttar Pradesh), Gandhinagar (Gujarat), Nagpur (Ma-
Photo by harashtra), Kalyan-Dombiwali (Maharashtra), Indore
(Madhya Pradesh), Imphal (Manipur), Kohima (Naga-
land), Dehradun (Uttarakhand), Chandigarh (Punjab),
Gurgaon (Haryana), Coimbatore (Tamil Nadu),
Visakhapattanam (Karnataka) and Thane (Maharash-
Of these cities, Nagpur, Maharashtra will be devel-
oped as the first solar city in the country and is expect-
ed to be completed by 2012. Various other states have
started preparations for developing cities as solar
Solar Water Heater installed in Manipur by Selco India
Semiconductor Policy for Solar
For promotion of domestic manufacturing capacity,
Semiconductor Policy was announced in March 2007.
The policy provides capital subsidy for units set up in
States, such as Gujarat, have announced their own the areas of solar cells, photovoltaics, and other
solar policies, wherein targets have been set for solar emerging technologies. Encouraged by the incentives,
PV power generation capacity which are much high- capacities are being added and set up by companies
er than the overall targets set by MNRE (500 MW such as Moser Baer, Solar Semiconductor, Reliance,
for Gujarat). Policy support from state as well as cen- IndoSolar, etc. It is estimated that the installed capaci-
tral government has created huge interest in the mar- ty in India could reach over 5GW in the next 3~4
ket. Various Indian and international companies have years.
expressed interest in setting up generation capacities
across the country. The announcements already Bright Future Ahead
made by companies total more than 1 GW of genera- With the increased focus of the Indian government
tion capacity. The first power plant under this on use of solar energy and the awareness and demon-
scheme is expected to be operational in West Bengal stration programs undertaken, the solar PV industry in
during mid 2009. India will see an exponential growth. Apart from grid
interactive power generation, stand-alone applications
State Level Tariff for Solar Solar Cities such as home light systems, solar street lights, and
PV Power Generation Considering the rural electrification programs are being undertaken.
huge power re- Considering the shortage of power in the country and
State Tariff (INR/KWh)
quirement in unavailability of grid at these places due to difficult
Haryana 15.96 urban areas, terrains, solar energy provides a cost-effective solu-
Rajasthan 15.78 MNRE, in Febru- tion. Various companies have entered the market and
Punjab 15.00
ary 2008, an- others will soon enter the scene. The Indian PV indus-
nounced support try is set to shine bright.
Tamil Nadu 3.15 for municipal cor-
Maharashtra 3.00 porations for Nimisha Garg is Director of
Gujarat 13.00 preparation of (
West Bengal 11.00
Road Map for
Uttar Pradesh 15.00

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