Soon 20% of all C&I Solar Systems in India Will be Grid-Tied: Report

Jul 24, 2020 01:25 PM ET
  • Enhancing power demand and climbing grid tariffs for commercial as well as industrial (C&I) customers are driving service individuals to rooftop solar, which is not just cleaner and cheaper however additionally gives them tariff assurance for 25 years.
Soon 20% of all C&I Solar Systems in India Will be Grid-Tied: Report

In 'Powering up Sunshine-- Untapped Opportunities in India's Rooftop Solar Market', a new report from JMK Research & Analytics and also the Institute for Energy Economics as well as Financial Analysis (IEEFA), writers Jyoti Gulia and also Vibhuti Garg check out the raising awareness of the advantages of rooftop solar power for India's business customers.

" Commercial and also commercial (C&I) customers consume around 49 percent of the electricity produced in India, yet only 3.5 percent of the power acquired by India's C&I segment is from renewable sources," said Gulia. "C&I rooftop solar has substantial possibility, and also currently represents 70-80 percent of all the country's rooftop solar installments."

Garg states this scenario is quite various from various other economic situations where the residential section brings about rooftop solar.

" The reason is that, in India, domestic and farming customers are subsidised while C&I consumers are levied an extra significant cross-subsidy additional charge causing greater than ordinary keys electrical power tariffs," said Garg. "As an outcome, roof solar is a financially viable remedy for C&I consumers."

India's roof solar market has, broadly, 2 service models-- Capex & Opex. From the viewpoint of a power customer, Capex is a self-financing design while Opex is a third-party funding version. Opex represented virtually a 3rd of all cumulative rooftop solar installments in India at the end of last year.

With the falling devices price, the payback duration for rooftop solar jobs in India is also gradually shortening. Presently, in capital investment (Capex) version, payback can be become aware by a shorter duration of 3-4 years, while for an Opex job the tariff rate is about Rs 3.5-4/ kWh (USD 0.047-- 0.053), which is less than half the average of C&I grid tariffs common throughout many states.

MSMEs are most likely to aggressively take on solar in the coming years. In the C&I section itself, tool, small, and mini ventures (MSMEs) are most likely to strongly embrace solar in the coming years.

" MSMEs are the backbone of the Indian economy, adding 6.1 percent of gdp (GDP) and regarding 45 percent of total manufacturing output," claimed Gulia. "Electricity prices depend on 50 percent of their overall expenses, so cutting such prices using solar power sustainably boosts their competition in a large means."

The report keeps in mind there are enough growth chances in C&I roof solar, but two fundamental concerns, funding and also governing unpredictability should be taken on to quicken adoption in this section. Distributed, domestic generation is a crucial solution to fulfill India's energy security and power needs.

The authors' further information that under the recently released Draft Electricity Amendment Act 2020, numerous dynamic measures are likewise planned for the renewable energy market such as presenting a pan-India eco-friendly acquisition commitment (RPO) with a stringent penalty mechanism. RPOs urge discoms as well as various other huge electrical power consumers to buy a specific portion of the power they require from renewable energy resources. Such an action would give a considerable boost to the uptake of roof solar in the C&I sector.

Guliia additionally believes that the following change in roof solar will certainly remain in storage. "It is likely that in the next 2-4 years, 20 percent of all C&I setups will be attached to the grid, coupled with battery storage space," she said. "Technological developments such as even more cost-reflective time-of-day tariffs, smart meters, high-efficiency modules, and also battery storage will certainly drive the development of this market."