GS (M) Paper-3: “Infrastructure: Energy”
Solar Sector: Solar power breaks a price barrier
In another barrier-breaking development, the auctioned price of solar photovoltaic (SPV) power per kilowatt hour has dropped below Rs. 3 to Rs. 2.97 in Madhya Pradesh, providing a clear pointer to the future course of renewable energy.
This is the first time in the history that the tariff of electricity based out of Solar Power Plants is going to be at sub-3 level.
- The National Solar Mission, inaugurated in 2010, is an initiative of the Government of India to promote renewable solar power. It has set a target of achieving 20GW by 2022 which was later increased to 100 GW in 2015.
- An important missing aspect in the national policy on renewables is the failure to tap the investment potential of the middle class.
- The grid-connected large-scale installations have received maximum attention, while the rooftop solar sector was largely ignored.
- Also, the target of installing even 12 GW solar capacity in 2016-17 is far from attainable now, since it fell short by almost 10 GW as of December 2016.
The experience of Germany, where robust solar expansion has been taking place over the years, illustrates the benefits of policy guarantees for rooftop installations and feed-in tariffs lasting 20 years.
SPV costs are expected to continue to fall, and tariffs paid both for large plants and smaller installations require periodic review. At some point, significant subsidies may no longer be necessary.
What needs to be done?
- The progress in solar sector must be deepened with policy incentives, for several reasons. The most important being, the need to connect millions of people who are without access to electricity.
- Clearly, adding more than 10 GW capacity annually over the next six years will require active participation and investment by both residential and commercial buildings sector.
- This process can be kick-started using mass participation by citizens, with State electricity utilities being given mandatory time frames to introduce net-metering systems.
Currently, India needs a lot more good quality power, which renewables provide.
Solar power is an emissions-free driver of the economy, generating growth in both direct and indirect employment. A lot of sunlight remains to be tapped.[Ref: The Hindu]