The Modi government recently completed two years in office. Substantial progress has been made in our view on improving overall sector investment outlook and policy environment in these two years under ministerPiyushGoyal.
There is a very supportive broad policy framework in place; Specific policies and/or plans have either been put in place or are being deliberated upon for each of the key sectoral issues including land and transmission availability, distribution company (DISCOM) finances and grid capacity;More needs to be done on boosting rooftop solar market and improving long-term financing flow to the sector but the industry seems broadly satisfied with overall progress;
Over the past two years, the rooftop solar market in India has grown at a compounded annual growth rate of 90%. As of March 31, 2016 the cumulative installed capacity stands at 740 MW (refer INDIA SOLAR HANDBOOK 2016). This growth is directly linked to the improvement in price competitiveness of rooftop solar power vs grid power.
Commercial and industrial (C&I) segment makes up almost 73% of the market, leaving the remaining 27% for the residential segment. As viability improves, we expect industrial rooftop segment to account for the fastest expansion at an annual growth rate of 248% until 2020. Tamil Nadu leads the installations due to high consumer awareness and lack of reliable grid power. Gujarat comes in second place and here the rooftop market has been primarily driven by state government initiatives. Maharashtra comes in third driven by high consumer tariffs across all consumer categories is very high.
Around 87% of all rooftop capacity in India is based on the CAPEX model while about 13% (102 MW) is based on the OPEX/ RESCO model. However, the OPEX based project market is showing a year on year growth of about 150%, and is expected to take up a higher market share as the market matures. In other developed countries like the US and UK, the OPEX model is a preferred choice for consumers.
Despite the impressive growth, the market is still way behind on achieving the 40 GW rooftop capacity target for 2022. This is especially true if we compare it to the success of the utility scale solar segment. The key challenges that the government needs to address are improving net metering policy framework and cost/ availability of financing for consumer and start-up RESCO’s. Consumer education remains another major hurdle for the sector.
The Ministry of New and Renewable Energy (MNRE) has issued a draft national policy for mini and micro grids (refer). The policy aims to create up to 500 MW capacity in the private sector in the next five years.
India has a terrible record on providing reliable grid electricity to large parts of the country; several startups have enjoyed limited success in the mini and micro grid sector but a scalable, profitable model seems to be elusive. The policy provides some much needed policy certainty to the sector and includes measures such as single window clearance, grid connectivity and pricing visibility for evolution of bankable business models
Grid power is heavily subsidized for residential and agricultural consumers and the ability of these consumers to pay for more expensive mini/micro grid power continues to be a concern. The Modi government wants to provide ‘24×7 power for all’ in the country by 2019. This is a very lofty target as India has up to 250 million people without access to grid and many more still who have grid connection but face outages of up to 16 hours a day.
As a part of the DeenDayalUpadhyaya Gram JyotiYojna (DDUGJY), the government is in the process of electrifying 18,452 villages by May 2018. Out of this, 14,204 villages have been identified for extension of the grid and 3,449 villages are to be electrified through off-grid power projects (refer). As per the government data, grid extension work is progressing ahead of schedule and 49% of the target has been achieved in the past one year. However, only 16% of the off-grid target has been achieved so far (refer).
Several start-up enterprises have sprung up in the last few years offering multiple business models and product solutions in this space. Companies like Husk Power, Gram Power, Gram Oorja and OMC Power have enjoyed reasonable success but a scalable, profitable model seems to be largely elusive. Main challenges include customer inability to pay (poor affordability), poor policy framework and multiple implementation challenges.
The draft policy is technology agnostic and tries to address many of these challenges:
- determination of regulated prices for mini grid projects with some tariff determination flexibility provided to mini/micro grid operators;
- single window clearances for seeking regulatory approvals and right of way, availability of information on taxes and exemptions;
- notification of areas where grid extension is not planned;
- creation of local village committees to ensure customer adoption, payment collection and faster dispute resolution;
- provision of grid connection to enable sale of power to local utilities;
- RPO multiplier to make interconnection more attractive for distribution companies; and
- Specification of quality and performance standards.
The policy is still in draft stage and is meant as a guideline for states, who can adapt or modify the policy based on their local needs. BRIDGE TO INDIA believes that it provides some much needed policy certainty to the sector and includes many of the measures needed for evolution of bankable business models for mini and micro grids. But somewhat surprisingly, it doesn’t offer any direct financial incentives or subsidies. Grid power is heavily subsidized for residential and agricultural consumers and the ability of these consumers to pay for more expensive mini/micro grid power continues to be a concern.
On Sunday, 5th June 2015, one of India’s leading economic journalists, SwaminathanAiyar, in his weekly column “Swaminomics”, wrote that India should wait for five years before trying to implement big plans for solar (refer). He argues that solar is still a comparatively expensive energy generation technology and that because India is an evening peak country, increasing the share of solar would be a “double whammy”, by driving up indirect costs for thermal, peak power generating sources. As a result, he concludes, India should go all out on solar only after it is fully established that the cost breakthrough has been achieved and the technology is more mature. While there are interesting insights in the article, but we disagree with his conclusions. Here is why.
- Solar costs are not as high as Swami claims. In fact, upcoming NSM bids will show that it’s neck to neck with new thermal projects.
- India is an evening peak country right now but as the economy develops the peak will move into the daytime (cooling).
- Global investors already see the social and economic appeal of solar and are moving out from coal to the sector.
This Order is applicable to all new grid connected solar rooftop and small solar photo voltaic power plants, entering into Power Purchase Agreement (PPA) and commissioned on or after 2nd May, 2016 and up to 31st March, 2018.
Sharing of Clean Development Mechanism (CDM) benefits between the generating company and the beneficiaries
- 100% of gross proceeds on account of CDM benefit are to be retained by the project developer in the first year, after the date of commercial operation of the generating station,
- In the second year, the share of distribution licensees shall be 10%, which shall be progressively increased by 10% every year till it reaches 50% and thereafter, the proceeds shall be shared in equal proportion by the generating companies and the beneficiaries.
Grid Connectivity for roof-top projects
- 1 kW to 5 kW – single phase 230 volts
- 5 kW to 50 kW – 3 phase 415 Volts
- 50 kW to 1 MW – 11 kV line.
- Metering shall be in compliance with the CEA (Installation and Operation of Meters) Regulations 2006 as amended from time to time.
- In the case of, solar rooftop PV systems connected to LT grid of a distribution company, the concept of net metering shall be adopted and the net energy pumped into the grid shall be billed.
- In the net -metering, the consumer is paid for the net energy i.e., the difference between energy generated from solar rooftop plant and consumed by his/her installation.
- This concept allows only surplus energy to be injected into the grid. The Commission had proposed to continue with net-metering concept for all consumers, other than domestic consumers.
- In the case of domestic consumers, the Commission had proposed to adopt gross metering concept where the entire energy generated by the solar rooftop plant is allowed to be injected into the grid
Note – An amendment to CEA (Installation and Operation of Meters) Regulations 2006 has been issued recently, in which a new definition of “renewable energy meter” has been introduced to extend clarity to net-metering scheme.
- If export>import, ESCOM pays generator at the tariff determined.
- If import > export; then generators pays to DISCOM at prevailing retail tariff.
Applicability of Wheeling and Banking Charges and Cross Subsidy Surcharge:
For solar generators going with intra-state open-access, no wheeling/banking charges or cross- subsidy charges are to be paid.
The Chhattisgarh Electricity Regulatory Commission came up with its final order on the CSERC (Terms and Conditions for Determination of Renewable Energy (RE) Tariff) Regulations, 2015, (“the RE Tariff Regulations”) on 1st May, 2016. The RE Tariff Regulations specify the Terms and Conditions and the Procedure for determination of Generic Tariff by the Commission. Central Commission has specified capital cost as Rs.619.16 Lakh/MW for wind energy projects for the year 2015-16.The graph below gives a comparison of the RE tariff determined in year 2013-14, 2014-15 to 2015-16 for wind generators.
In the Draft Generic Tariff Order, the normative Capital Cost for the Solar PV power projects for was not declared by CERC and accordingly, the Commission proposed to consider the same Capital Cost of Rs. 605.85 lakh/MW for the Solar PV Projects and Rs. 1200 lakh/MW for Solar Thermal Projects to be commissioned in the period from 1 April, 2015 to 31 March, 2016.
The graph below gives comparison of Generic Tariffs for Solar Projects in the period from 2015– 2016 to the previous years. The tariff has been determined depending on the type of solar project as follows:
Many people are not so clear about the difference between mono and poly crystalline solar panels. Let us take a look at the 2 types of panels and see which one is better and what makes them different from each other. Even though mono crystalline panels had the initial advantage of being seen as the superior technology, when time went both the technologies improved and the quality and reliability of the panel make is far more important than which of the two technology is chosen.
THE DIFFERENCES :
A typical monocrystalline solar cell is dark black in color while polycrystalline cells are either light or dark blue color. The result in appearance is a result of the different type of manufacturing process. During the solar PV boom in 2010monocrystalline panels were thought to be superior to polycrystalline panels. The reasons for this are ready availability of mono panels when compares to poly panels and the higher peak efficiency of mono panels. It is not true that mono panels are always better than poly panels, the quality of the panels depends on the manufacture.
Comparisons of efficiency :
- GermanSolar brand 60-cell monocrystalline Premium Line panels have 15.47% efficiency.
- Conergy’s polycrystalline PowerPlus modules, 14.3% efficiency.
- Sun-Earth’s 190W monocrystalline module, 14.9%
Solar panel efficiency and its importance to the system :
For buildings with ample roof space, a panels peak efficiency is the not the most important factor. It is very important to use quality products so that the price and the quality is balanced. At the end, if you look at the overall performance of the system, it is defined not just by the quality of the panels, but the solar inverter has a huge role. Some other small factors are, installers labour costs, the orientation and tilt of your panels.
Beyond efficiency and module, importance of the company from which the product is procured :
Although quality technology is important in selecting the solar panels, both the panels have their advantages and one cannot be simply considered better than the other. Since the manufacturing equipment for silicon is now readily available, it is easier for the companies to manufacture the panels. What differentiates a quality company from a bottom line company is the R&D that investment. For most houses balancing affordability with reliability is key. Solar power systems are expected to operate for more than 30 years + while they have a product warranty over 25 years. Hence while selecting a panel it is important to make sure that years down the lane the manufacturer is likely to be around. If the panels need repairing, the cost would end up being greater than the initial investment.
Solar Power Conditioning unit (SPCU) is an integrated system that provides the facility to charge the battery bank through either a Solar or Grid/DG set.An SPCU (solar power conditioning unit) will consist of the following parts:
- Solar charger
- Grids (main utility) charger
- Output selector mechanism
- Battery mechanism
- Control algorithm
Solar Charger : The sole purpose of the solar charger is to convert the solar energy collected by the photo voltaic panels to charge the battery. There are basically two types of solar chargers available in the market :
PWM type:in this type the panels are directly connected to the battery through an electronic switch. The PV panels are considered as a current source and it delivers current at a voltage equal to the battery voltage plus the drop across the switching element. This is a very low cost charger. The main drawback here is that the SPV voltage is controlled by the battery voltage and because of this the PV panels don’t operate at its peak voltage and hence efficiency is less. For switching the panel to the battery either a combination of MOSFET and diode is used or a Zero drop type switching is used.
MPPT Charge control: In this type an electronic conversion unit changes the voltage of the solar panel to the battery level. Here since the panel voltage is independent on the battery voltage level, the panels are operated at its peak power point. Hence utilization of the panel is maximized. This is used for larger systems and this is costlier than PWM type.
Inverter : In simple terms this is the heart of the solar PCU. This part is responsible for converting the DC voltage from the battery to SC power to the output. There are different technologies that exist for inverter. In the transformer based inverter, the dc-ac inversion happens at low voltage of the battery and then it is stepped up using a transformer. This technology is being replaced by High efficiency switched mode power supply (SMPS) based inverter around the world. The SMPS is used to transform the dc current to high voltage DC and it is then inverted.
Grid Charger : It is an auxiliary charger in a Solar PCU. It charge’s the battery from the grid when solar is not available. Different type of chargers are available in the market. Some inverters are even bi-directional and have the ability to charge the battery in the reverse direction from the grid.
Selector Mechanism : The system is always placed in the solar mode, under this condition the power from the PCU will be coming from the inverter. But when solar energy is not sufficient enough the appliances will be operated from the grid. This is made possible with the help of a relay.
Battery bank : The battery bank stores the solar charge for use by the inverter. In a normal day solar energy keeps varying depending on cloud formation, shadow and time of day etc. The loads connected to the inverter will also be having its own variations in loading pattern. Hence it is very essential to have a battery backup to act as a buffer and for storage of electricity produced through solar. Use C10 tubular batteries which are available in the market exclusively for solar systems.
This is the part which distinguishes a solar PCU from an ordinary inverter + solar charger. This is the part which controls the priority and optimally select which is the source of charging solar or grid or both. It also selects the source of ac output to be either from the inverter or from the grid. It can operate in either Solar-Battery-Grid or as Solar-Grid-Battery. In solar-battery-grid, the battery is charged first and also supports the inverter to power the appliances. Once the solar energy stops, the PCU starts consuming the stored energy from the battery. Once the stored energy is used to a particular level, the inverter stops and the connections to the appliances is given from the grid with the help of output selector. The main focus here is to save the electricity bill cost. In the solar-grid-battery mode of operation, the battery is first charged with the help of solar and also supports the inverter to power the appliances. Once the solar energy stops coming, the appliances are run with the help of the grid using the output selector. The battery is not discharged in this case till there is a grid failure. This type is used at places where power outage is more and the consumer wants to use the grid as long as it is available. The battery is kept as a backup to use when the grid fails. In this condition at day time the load will work in solar power. Here the main purpose is to have uninterrupted solar power. The efficiency of the inverter is one of the most important factor which decides the overall cost of the system. For eg transformer based inverter has only 70% efficiency, while for SMPS based high frequency inverter the efficiency is 90%. In short it is very important to choose the right type of technology for a solar PCU. Not doing so, one would never get the real benefit of the installed solar system.
What is solar energy?
In simple terms solar energy is the energy provided by the sun. Solar energy comes in the form of radiation, which in turn helps to produce electricity. It is actually the light and not the temperature that matters when it comes to producing electricity from solar energy.
The Real Working
The light energy is converted into usable solar energy by the panels, with the help of N type and P type semi-conductors. When lights falls on the panels, it is absorbed and it knocks electrons from their atoms, which in turn allows electrons to run through the material which in turn produces electricity. Solar panels mainly convert about half of the ultraviolet and infrared spectrum, while most of the visible light is usable solar energy.
Different Solar Energy Technologies used in the Indian Market
Photovoltaic (solar cell) systems - Solar cells are often used in the past to power calculators and watches. They are mainly made up of semiconductor material. They are used to convert light (photon) into electricity (voltage) which is called as photovoltaic effect (PV) effect. Solar cells are normally mounted on a module, which would contain about 40 cells. These modules are connected together and used to power houses partly or fully. They are mounted on rooftops or on floors with the help of structures facing in the south direction with a small tilt which depends on the geographical location of the site.
The performance of a solar cell is usually measured in terms of its efficiency of converting light into electricity. Usually on the market the average efficiency of cells are about 14-15%. There are higher quality cells available which gives about 30 -35% efficiency but those panels are very costly and hence not feasible for everyday projects. The first solar cell was built in 1950 and it had about just 4% efficiency.
Solar Hot Water - For solar water heaters the panels are setup in a way so that they are facing south (this is to make sure that the system receives more of the sunrays throughout the day). This system consist of mainly 2 parts. A solar collector and a storage tank. Most of the systems come with a flat plate collector having a transparent cover that faces the sun. There will be small tubes running through the box carrying water to be heated. Once the heat starts building up in the collector the water running through the tubes also gets heated up.
The storage tank is responsible for holding the hot liquid. It usually comes in 100Litres or 200Litres in the Indian market. Another type of classification comes in this system when it comes to the way the heated water is transferred. Active system uses a pump to transfer the water while passive system using the normal gravitation force.
- Solar energy is one of the forms of cleanest energy as it doesn’t produce any greenhouse gases. In effect setting up a solar system helps in offsetting CO2 from the earth’s atmosphere. 10kw solar electricity will help to reduce about 10kg of CO2 equivalent.
- Solar energy doesn’t produce smoke.
- It doesn’t involve destroying the environment.
- Conserves so much water used in electricity production.
- Eliminating the needs to burn fossil fuel.
- Planting acres of trees.
For people in India and those around the world it was a shock when they heard about bankruptcy filed by SunEdison, the world’s largest solar company. But many people in the field of renewables and solar and many industrial experts saw it coming months before. Let’s take a look at what possibly may have happened with this company who were once the giant in the solar industry.
This was not the first time a solar company had failed and had grabbed the business headlines. In 2011 a solar startup Solyndra filed for Chapter 11 bankruptcy protection. What’s the similarities in both – presidential election in the US. According to different sources the partisan uproar that immediately arose after the 2011 bankruptcy of solar startup Solyndra could not be more striking.In 2016, an even more contentious presidential election is underway, and the nation’s partisan divide has only increased in the past five years.If the opponents of clean energy wanted a political cudgel, SunEdison’s a big one. (more…)