Has Rooftop Solar In India Finally Reached A Tipping Point At 8 Cents Price Per Unit
Due To A Gargantuan Number Of Solar Installations, China Puts a Hard Stop To New PV Plants
December 13, 2016
Does India Really Need Offshore Wind
December 15, 2016Solar Rooftop India Prices
Solar rooftop has been the ugly baby of India’s renewable energy industry. Despite tall promises made by the Indian government to install gigawatts of rooftop solar, the sad fact is that only 1 GW of solar on rooftop have been installed till date. Though the growth has been clocked at 100%, the base is quite small making the growth figures look large. There are huge problems facing rooftop solar as distribution utilities are also required to play a big role which they are unable and unwilling to do.
Without net metering, making rooftop solar viable is a tough task and for that the utilities have to be on board. Also getting through the maze of rad tape and regulations is another huge challenge. This has made rooftop solar wobble along even as large scale utility installations have raced along to 7 GW of installations. Going forward too rooftop solar does not have the same momentum which ground based large solar power plants have.
Also read Which states are the Most Friendly towards Rooftop Solar in India
However, things may have finally started to turn. The government came out with one of the largest rooftop solar tenders in the world at 500 MW to be installed using a mix of PPA and capex business models. It received a huge response as most solar tenders in India tend to usually do. What was also nice to see was the competitive bids put in by solar bidders. Given that the ticket size is small, solar rooftop tends to have a much higher tariff than large scale ground plants. But the bids were in the 7-8 cents range for most state. Some states reached a tariff as low as 4 cents but that was mainly because of the 70% subsidy being given for underdeveloped regions. Even the 7-8 cents/kWh is a big achievement for the sector since it makes it competitive with the normal electricity rates that large residential customers get in major Indian urban cities.
This tariff is also fixed for 25 years unlike electricity rates which go up by at least the inflation rate of 5%. Rooftop solar is economically cheaper for a large segment of the Indian population now but the problems of the net metering and financing are holding it back. However, I think that this is temporary as solar prices keep falling, soon it will be so much cheaper that grid electricity will die a slow excruciating death.