As the cost of electricity continues to rise and generation of solar power becomes cheaper, the latter is expected to reach grid parity in Delhi by 2018
By Nitasha Chawla
Thursday, October 17, 2013: During the 11th Plan period, the Ministry of New and Renewable Energy (MNRE) proposed that a total of 60 cities and towns be developed as solar cities. The Plan said that at least one city, going up to a maximum of five cities, in a state will be supported by the ministry for its transformation into a solar city. However, major cities like Delhi and Mumbai have not been included among these 60 cities, despite the acute electricity shortage in these metros.
Does Delhi has the potential?
According to the Census 2011, Delhi’s total land area is 1483 sq km. If such an area can be made available for solar installations, it could support 123 GW of installed capacity which, at peak power production, would be more than 20 times Delhi’s current annual peak power demand of 5.6 GW and more than half of India’s current installed capacity of 215 GW. According to the Delhi Master Plan 2021, 700 sq km of Delhi’s total area is built-up. A recent report by Bridge to India, a strategic solar consulting company, reveals that given this built-up area, the potential for rooftop PV solar installations in Delhi can be tremendous. If the rooftops on this entire built-up area could support PV solar installations, the city could potentially generate 58 GW of solar power, the report says.
There are certain factors that work in favour of Delhi becoming a solar city, while some others go against it. Shares DK Varshnei, director, Saur Oorja, “Delhi does not face the problem of power shortages like other cities listed by the MNRE. In Delhi, there is easy access to electricity; hence, there is no will to go for solar power. The only way the solar rooftop model can be implemented in Delhi is by making it compulsory for upcoming residential projects to have solar rooftop installations.”
In Delhi, the cost of solar products is higher than that of in other cities, including Mumbai, because of the 5 per cent value-added tax (VAT) charged by the government. This is also one of the reasons why people are not in favour of going solar in Delhi.
However, the falling prices of solar power can lure consumers to adopt this green energy. Says Mohit Anand, senior consultant, Bridge to India, “The solar market across the globe has been witnessing prices falling each year. The cost of electricity in India at the moment is Rs 8.5 per unit (it varies from state to state) for commercial and industrial use, and the cost for solar power is Rs 9 per unit. By next year, the costs will be reversed as the electricity prices are rising, while the prices of solar power are dropping. Therefore, we believe that, by next year, the prices of solar energy will be at par with the cost of current grid-based electricity for commercial and industrial uses.”
While solar power can become a reality for industrial and commercial applications by next year, the report states that for residential applications, the solar model will become affordable only by 2018. By then, electricity prices will be on par with the cost of solar power.
Raghunandan SS, vice president, PV and engineering, Kotak Urja Pvt Ltd, has the same view. He feels that we are nearing the level of grid parity and, by 2017, the cost of using PV solar power should be less than the grid-based electricity. Until then, the government should incentivise the use of solar power in Delhi as it is a big city with huge consumption of power. “Delhi should ideally be part of the solar revolution and must be included in the MNRE’s list of potential solar cities,” he says.
Lack of space for power plants in a highly congested city like Delhi is another reason for it being difficult to be converted into a solar city. Despite Delhi’s total built-up area being 700 sq km, not all of Delhi’s rooftop space is viable for solar, scaling down the city’s potential drastically.
How Delhi can benefit by going solar
The most important benefit for the city will be the power savings. DK Varshnei estimates power savings of 5-10 MW per day, if Delhi adopts the solar model. Bridge to India’s report says that once solar rooftop installations become a reality in Delhi, it can achieve an installed capacity of 2 GW by 2020.
Another benefit which solar power offers to the government is that it can save the huge costs of transmission losses incurred while electricity is transported from generators to the transmission/distribution interface. Explains Raghunandan SS, “The government can calculate incentives to use solar power based on the amount it will save against transmission losses if Delhi adopts the solar model. As of now, the power distribution companies lose roughly 27.5 per cent of electricity during transmission. If Delhi goes solar, these losses can be done away with.”
What is a solar city?
A solar city aims at reducing a minimum of 10 per cent of the projected demand for conventional energy, by the end of next five years, through a combination of enhanced supply from renewable energy sources in the city and through energy efficiency measures.
The basic aim is to motivate the local governing bodies to adopt renewable energy technologies and energy efficiency measures. In a solar city, all types of renewable energy based on solar, wind, biomass, small hydro projects, waste-to-energy conversion systems, etc, can be installed, while putting in place energy efficiency measures, based on the needs and resources available in a city.
Source: http://www.mnre.gov.in
Financial assistance under solar city programme
Up to Rs 5 million per city/town is provided depending on the population and initiatives decided by the city council/administration:
- Up to Rs 1 million for the preparation of a master plan within a year, along with a few implementable detailed project reports
- Up to Rs 1 million for setting up of a solar city cell and its functioning for a period of three years
- Up to Rs 1 million for oversight of the implementation process for three years
- Up to Rs 2 million for capacity building and other promotional activities to be utilised in three years
In addition, the financial and fiscal incentives available under various programmes of the MNRE will also be applicable to solar cities to install other renewable energy projects, systems and devices.
Source: http://www.mnre.gov.in
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