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Why Indian Clean Energy Policy is Misguided by CSE

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I have said in numerous posts that India’s support and subsidies for large solar power projects may not be the best use of money.

The CSE concurs and also criticizes the support for large wind farms as well . Note the capital subsidy and depreciation given to wind farms makes it much more lucrative to just build wind energy turbines rather than on focusing on the electricity generated . This has made many wind farms generate only half of the electricity given by normal wind turbines. Note the article also emphasizes on giving subsidies to the poor through loans and subsidies for biomass energy to shift them from dirty energy sources like kerosene.


Here lies the nub of the problem. The poorest need access to what are currently the most expensive systems. This is possible only with massive public-financed programmes that drive down the cost.

The fact is that 10 to 12 per cent of the primary energy supply today comes from renewable sources (not counting hydroelectric energy). But new renewables – technologies of the future – still make up only one or two per cent of this supply. The rest comes from biomass systems of the poor, like the stove that burns wood or cow dung. These are the clients who can now either take the next step on the energy ladder to kerosene or liquefied petroleum gas or jump to the top of the ladder by moving to modern biomass energy sources. These are the same clients who are in the dark, but today they have the option of selecting decentralised mini-grids for their energy needs. But if these are the people who are the targets of the new ventures, then business is completely out of touch with its customers.

The same businesses, with the same wheeling and dealing to make a fast buck, are taking over the future. A few years ago, when the Centre for Science and Environment (CSE) studied the wind energy scenario in India, it found that business had subverted the purpose for profit. Wind farms set up across the country were not generating energy. The plant load factor was only 10 or 11 per cent in many states, against the norm of 20 per cents

What India’s Solar Energy Needs

India is a massively energy deficient country with official figures citing around 15% of peak electricity demand deficit due to lack of power generation and distribution.The figures would be much higher if you add the thousands of villages which don’t have grid connectivity and access to power.Solar Energy in India is perfectly suited to fill a number of holes and the government has made a start by fixing an ambitious 22 GW solar capacity target by 2022 which rivals that of China.However the first phase of the JNNSM has mainly given subsidies and incentives to large megawatt solar installations which are to be ground mountedSolar Energy incentives in most of the developed solar markets in Europe have clearly shifted their preference to distributed small rooftop solar installations on residences.This is because it reduces the need for expensive power generation infrastructure,improves reliability and puts money in the hands of the common citizens.Spain,Germany and Italy which are the 3 biggest markets in the world have done this.India however has not paid any focus to rooftop solar installations except for Delhi.Electricity in India is not only expensive but also highly unreliable and of low quality.Low voltages and blackouts of 10 hours are not uncommon.Having a reliable home based source of power would be attractive to most people in India even at higher costs (note electricity tariffs have been outgrowing inflation).It would also lead to reduced losses in the power transmission which is the highest in the world at around 30%.The advantages of promoting residential solar is much more however the policymakers have not given enough thought with half of the subsidies going to Solar Thermal Technology which is fast losing out to Solar PV technology.India’s solar policy makes it clear that the decision makers do not have enough knowledge about the developments in this fast paced solar energy sector to make the optimum decisions.

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Sneha Shah

I am Sneha, the Editor-in-chief for the Blog. We would be glad to receive suggestions, inputs & comments on GWI from you guys to keep it going! You can contact me for consultancy/trade inquires by writing an email to or call me on +913340606492.

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