PERSPECTIVE
What Has Kept Rooftop Lagging In The 2022 40GW TARGET RACE? What Are Some Lessons To be Learnt?
Prelude India has set an ambitious target to achieve 40 GW RE capacity from rooftop solar projects by 2022. However, India has installed only 9 GW till Dec 2021, hence it is highly unlikely that India will achieve its set rooftop target. Though India’s solar energy capacity has risen 17 times in the last seven years, when one looks at the various targets set for the shift to solar, it becomes evident that there is still a long distance to be covered. Rooftop Solar is an attractive pathway toward RE shift, which will help in covering this long-distance as it has a minimum requirement of land and negligible distribution losses. However, in spite of being the easiest and surest path, it has lagged behind. There have been a number of factors that have contributed to this, one of them being uncertainty in policymaking. Also, the rules on solar installations, including those related to gross and net metering, differ from one state to another, and also from one DISCOM to another. This leads to a lot of ambiguity. Rooftop solar in India has huge untapped potential. Clearly, states and local DISCOMs need to come and act together to make adoption and installation less costly and cumbersome. Meanwhile, awareness-building and facilitative initiatives from non-state actors could also help. If proactive measures are taken to improve the condition, this could transform the country’s dreams into reality to become a leader in climate action.
NITHYANANDAM YUVARAJ DINESH BABU EXECUTIVE DIRECTOR, TEAM LEADER, THE WORLD BANK - SBI GRID CONNECTED SOLAR ROOFTOP PROGRAM, EY
The journey of rooftop solar (RTS) adoption by India has been exciting thus far despite the gamut of challenges faced by this sector. It is heartening to witness the increasing awareness and an impressive adoption by several end-use segments in the country. These have signaled RTS’s inevitable transformation, though delaying the target set by the Government of India. It is fair to assume the enormity of the target when set for this sector way back in 2014. With the promising enabling ecosystem in the form of predictable and long-term policies and regulations coupled with access to financing, RTS was touted to be a game-changer in the Distributed Renewable Energy (DRE) market. Given India’s democratic power sector setup with States differing in implementing prioritized (read consumer-friendly) schemes, the RTS sector is suffering the most. The Central Electricity Regulatory Commission through the Forum of Regulators provided the crucial model regulation for implementing Net Metering way back in 2013 which was further modified to include transforming features in 2019. In 2014, the Ministry of New and Renewable Energy (MNRE) launched financial incentives (Phase I) for solarizing government and institutional sectors as well. Many States who were expected to make the most of the model regulation and incentives
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missed the golden opportunity resulting in a varied and complex implementation regime. DISCOMs are still shying away from having a comprehensive understanding of the impact of RTS; many have instead approached regulatory commissions and restricted net metering and other enabling RTS features to the consumers. These shaky pillars of support further triggered uncertainty in the availability of standardized financing product(s) and constrained investments leading to dismal uptake. Ministry of Power’s Rights of Consumers Rules 2020 isn’t helping the sector either with its revised ceiling of 500 kW for net metering as it is misconstrued as the new ceiling for all the States whereas it is a guide for states without net metering. Interestingly, smart developers successfully engaged with the commercial and industrial consumers (the so-called low-hanging fruits), and the third-party investment model (RESCO) coupled with CAPEX morel triggered the growth of the RTS market in India. In the meanwhile, MNRE discontinued the Phase I program and launched the Phase II program in August 2019, this time focusing on incentivizing the solarization of the residential sector. Several DISCOMs have demonstrated their interest in solarizing the residential sector under MNRE’s Phase II program. For example, Gujarat’s residential consumers have already installed more than 1 GW of RTS, thanks to MNRE and the Surya Gujarat program. Further, MNRE’s recent announcement to simplify the RTS installation for the residential sector through Direct Benefit Transfer (DBT) is expected to be a game-changer though with intrinsic challenges. Small and medium developers along with entrepreneurs/start-ups have come a long way in playing an active role in the RTS sector resulting in a significant number of green jobs. These vulnerable developers are trying to cope with the shocks from an abrupt increase in domestic and imported module costs in addition to restrictions imposed under ALMM (Approved List of Models and Manufacturers) guidelines besides postpandemic impacts.
APR-MAY ISSUE 2022 | PG 38