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Independent Project by Pranay Surakanti PGPIM Batch-3 Adani Institute of Infrastructure Management

Solar Power Vital Stats

Around 1000MW of installed capacity
CERC decides tariffs based on assumptions about capital

and operating costs. Costs between Rs.9 to 10 crore per MW for MW scale plants. Breakup: 2 crore for mounting and civil work. 5-6 crore on panel cost. 20-30 lakh for land. Rest for power equipment. (CERC tariff order) Drivers: Capacity factor, Interest cost, project cost

Solar Highways
Concept: Using land occupied by highways to generate solar

Why Highways: NHAI has so far 16,500km of 4/6 lane

highways under its NHDP program

Abundance: 1.32% of total land area

Open Space
Limited Use

Other Similar Applications: Railway Tracks Irrigation Canals

Solar Highway: Advantages

For Solar Power Plant: Ease and Speed of Land Acquisition Lower Investment in Evacuation Ease during construction For Road Operator: Extra Source of Revenue Lower Risk of Cashflow

Government: Can use generate money for non toll roads

The main objective is to understand the impediments to the implementation of this simple idea
Policy and Legal Implications that need to be cleared before. Technology and engineering Challenges

Economic Benefits: Model-wise

Evaluation of operating models based on above criteria

Who owns the land in a road project? Clause from MCA:
13.3 The license and the right to use the Site shall be granted for the purpose of carrying out the functions placed upon the Concessionaire under the Agreement and not for any other purposes Clauses 3.2 (vi) and 9.1 (xi) further restrict the Concessionaire from creating an encumbrance , lease, transfer or part possession, except as provided for by the CA.
In short, NHAI owns the land, and only has given the right

for to use the land for the purpose of construction or extension of the highway, and in return the Concessionaire gets the right to charge toll as prescribed.

Policy (Contd.)
By extension, the right to any alternative use has to be given

specifically by NHAI.

Will the Concessionaire have the right to gain revenue from

alternate uses?
This right also needs to be specified by the NHAI, similar to the right

to benefit from facilities such as fuel stations, food courts and hoardings. It would depend on how the NHAI is wants to structure the project, but it cannot pass on the right to alternate revenue to a third party by itself because the Concessionaire will be in possession of the land.

Technical and Engineering Viability

Over-Head Models A Roof over the Road T-Shaped median structure T-shaped shoulder structure Approximate Height 12 meters After Modeling in STAAD Pro, we found that the cost of

Roof-over-Road structure was most comparable with the normal solar plant (2 crore/MW), provided panels are placed horizontally and not tilted.

Roof over the Road

T-Shaped Structure

Technical and Engineering

Ground level structure: Excess Land at interchanges and between service roads Higher perceived safety Well established cost structure Easy acceptability NHAI acquires more land than it requires for having a safety


E.g. 4 lane highway requires 60 meter corridor and uses only 30

meters for the road structure 6 lane expressway between Surat and Mumbai is going to need a 120 meter corridor for a 50mtr road

So it is possible to utilise this land for solar power, provided

government takes initiative

Operating Structure
What are the ways in which the model can be

implemented? Who are the players in each model?

BOT projects:

NHAI-Concessionaire-Developer NHAI-Concessionaire

Govt. tolled or un-tolled highways

NHAI or State Government Developer Government Implementation Authority (e.g. GEDA)

Payment Mechanisms

One time Payment: based on share of project value Fixed Annual Payment: based on share of project value Revenue Share: as a percentage Electricity Share: supplying a certain number of electricity units

Recommended Method: Revenue Sharing The costs is fixed Gives incentive to increase efficiency factor Gives incentive for govt./concessionaire to continue giving good service

NHAI-Concessionaire-Developer Advantages Protects rights of the concessionaire as the possessor of land. Risks are shared by those best placed to manage those risks. Disadvantage: transaction costs will increase, especially monitoring and co-ordination while shifting. NHAI and Concessionaire cum developer Concessionaire becomes solar power producer Advantages are that it reduces transaction costs and increases the reliability of the cashflows for the concessionaire, since they are both not correlated

Government and Developer: Good model for un-tolled roads Can be structured as a BOT project which can generate free cash flow for the life of the panels Pays for road Maintenance
Government owned Implementation Authority: Low transaction costs Low funding costs High initial outlay

Awareness and Policy support from within the government

seems to be the core impediment Engineering not a barrier to implementation because of excess land availability Viable option for concessionaire and government Current PPP structures can be applied to this easily, for faster implementation
News: World Bank supports installation of Solar Panels along highways in Gujarat Indian Banks See Highway Toll-Like Cash in Solar

Prof. Girija Sharan
Prof. Pramod Yadav Ramachandran Rajagopalan Vishal Vora Ravi Kumar PBV