http://your-story.org/is-solar-an-expedient-solution-to-energy-security-will-piling-of-solar-project-and-policy-announcements-in-india-predict-the-market-growth-266072/

Energy sector is one of the major reasons of economic growth and development, both at the global or national level. With a trembling economic condition plaguing the last few years, energy security has become an issue of high importance. India has encountered triple provocation of climate change, energy security and economic development with political will and technological prowess. However the question that lies unanswered is would that be enough to bring in the capital to ensure a need of transition to clean green growth?

Endowed with rich solar energy, India has high solar isolation forming an ideal scenario for solar power. To meet the decentralized requirements of mainly the rural sector, alternate energy development has been part of its strategy. Solar energy in India offers enormous potential of 20 megawatt (MW) per sq km which is slowly gathering pace to enhance the generation capacity. It receives approximately 3000 hours of sunshine per year or 5000 trillion kwh (kilo watt hour) through abundant solar resources.

The total installed capacity of grid interactive renewable power, which was 14,486 MW in FY09, had gone up to 16,817 MW in FY10 indicating growth of 16.1 per cent during the period However, the total installed grid interactive solar power, accounted for 79.37 per cent growth in the solar sector, up from 2.12 MW in 2009 to 10.275 MW in 2010. The share of solar in grid interactive renewable power still accounts to nearly zero percent in the overall energy mix.

Source: MOSPI

Jawaharlal Nehru National Solar Mission, a transformational initiative taken by the government was launched on January 11, 2010 which planned three major initiatives including creating volumes which will allow large scale domestic manufacture, announcing a long term policy to purchase power; and supporting R&D to reduce material consumption and improve efficiency and develop new materials and storage methods. The government is initialising to popularize solar energy systems aiming to build 1,000 MW of solar power capacity by 2013 in the first phase. Further, it aims to add 20,000 MW of solar power by 2022 under the National Solar Mission.

On a global scale the solar power industry grew at close to 75-80%. The total installed capacity of solar PV has reached approximately 40 GW in 2010, with Germany being the leader in capacity addition.

India over all does not figure in the list of major markets for solar PV. Although solar power development has shown an upward trend here, there are certain challenges impacting the progress. These include Land Acquisition and Project Development, Project Financing, Long Term Funding, Solar Photovoltaic Technology remains economically unviable, Solar Irradiance, Energy Storage and High Initial Cost.

Solar PV in the industry is gaining spree as these systems are modular and flexible to all requested sizes, can be installed anywhere and are installed faster than any other power installation.

Further India boasts of significant off-grid opportunities, given the cost involved in off grid applications when compared to huge financial investments to be made to set up grids. Moreover, specific government incentives to promote off grid applications are also expected to prompt growth in off-grid opportunities.

Despite of the affirmative policies and support being provided by the centre and state governments, solar power remains a precarious and expensive option for power generation. It is contemplated that currently the cost of generation (levelised) far exceeds conventional as well as other renewable power. Looking at the overall scenario in the solar industry, it is thereby expected that solar projects may reach grid parity in the coming years, however, that is a distant dream.

Major initiatives by state governments of Gujarat, Rajasthan and Tamil Nadu for development of Solar Cities have been taken aimed at meeting the energy demand.

The country plans to shift to solar power in the future with three percent of energy portfolio to be from solar by 2022. Moreover, a prolonged strategy has been setup to achieve demand reduction from conventional energy sources. The strategy adopted by states endeavours to bring about energy efficiency and enhance power supply from renewable energy sources through solar cities.

However, with significant increase in demand in the future, the share of solar may not be significant enough to drive the country’s green drive and the high cost involved may not make it a developer’s favourite choice. Thermal sources of power generation are still expected to hold a major share in the energy mix.

The choice of purchasing high cost solar power may not find favour with the ailing distribution utilities. Though some states have taken major level initiatives like Gujarat and Rajasthan’s large scale solar farms to expedite solar power development in the country, the long term choice of fulfilling renewable purchase obligation through solar may not find favour with the discoms. Solar power being non-firm is only a seasonal option for power supply in the grid. The states have to device an efficient load forecasting system to accommodate non-firm solar power without impacting gird stability.

The report focuses on the growing market-place for solar industry at the domestic level and analyzes the current market trends along with future growth prospects of the industry. It provides state wise ranking based on different parameters thereby, helping in identifying factors critical to their successful market penetration. Besides, the report analyzes the technological knowhow, benefits and sustainability which will further help the experts to ascertain the future of the industry. It also addresses the intertwined issues of India’s solar market and deliberates interpretation perceiving whether piling of solar project and policy announcements in India can predict the sector growth.