SIDDHARTH GANGAL CEO, The Solar Labs
Grid-tied solar proj ects have seen a change in the installation costs and this is because of the recent publication of the benchmark rates of grid-tied solar rooftop proj ects by the Ministry of New and Renewable Energy (MNRE) for the year 2020-2021. These costs were effective from August 2020 and take into account the total proj ect costs which include solar panels, inverters, installation, commissioning, civil works, transport, GST (8. 9%) and complete maintenance for the following 5 years. The new costs have brought a 20% reduction for 100-500kW systems when compared to last year’ s rates. Also, the solar PV capacities have now been split into 1kW, 1-2kW and 3-10kW systems respectively. These rates are also flexible to vary for states that are classified as special categories such as Jammu and Kashmir, Himachal Pradesh, Uttarakhand and the union territories of Lakshadweep, Andaman and Nicobar Islands. However, are these benchmark rates in alignment with the current solar PV industry trends? For this, we at The Solar Labs interviewed some of our EPC clients to understand the market perspective on these policies. According to Mr Keyur Rakholiya, CEO of Heaven Solar Energy Pvt Ltd, the new benchmark rates brought by MNRE will affect the quality of the solar plants and services provided by the supplier because the reduced benchmark rates combined with subsidies offered by the government leads to a disparity in the quality and the price of the solar PV system. He suggests that government officials look more into the manufacturing processes occasionally to maintain the standard. Mr Ajay Yadav, President of REAR Renewable Energy Association has also confirmed the same. He also stated that the bidding rates vary from state to state which also compromises on quality. He recommends streamlining the bidding processes by making the process online. He also recommended clarifying net metering policies which are currently not covered in the latest benchmark rates published by MNRE. Mr Amit Thussu, Chief Strategist at Solar Compare also considers the MNRE rates to not be feasible because the reduced costs in alliance with government subsidies affect the impression of solar technology apart from the quality. In terms of volume of panels installed, the benchmark rates align with industry trends because cheaper the panels, more are people willing to invest in solar technology. Yet, in terms of generation analysis of solar PV systems, the panels installed based on these reduced costs won’ t be generating optimum power after 5-7 years because the materials used are cheap. He believes that this issue can be remedied by abolishing government subsidies stating that “we have to educate people on the value of solar, not on the price”. The idea of educating people on the value of solar PV technology has been reinforced by Mr. Abhimanyu Rathore, Founder and CEO of Solar Study ® . He stated that from Solar Study’ s perspective, the real installation market’ s established stance in the industry plays a pivotal role in the tangible values provided to learners. Their exclusive courses such as Python in PV, Blockchain in PV and Production of Low-Cost Batteries from Shrimp Cells aim to educate students and professionals on the value of solar technology in the industry. From these insightful perspectives, one can infer that although the MNRE has tried to establish solar technology in the Indian market, the current industry trends are not in sync with these policies. This discrepancy may be rectified through stringent government measures to maintain the minimum standard apart from reduced costs. This is because people need to look at the latest technology and the value they’ ll receive from the system for which they might have to pay a significant price initially but it’ ll be an investment of a lifetime!
| SEPTEMBER ISSUE 2020
PG 14