Narendra Modi Is A Big Fan Of Solar, But Not Coal
Originally published on RenewEconomy.
Australian coal producers – in particular the billionaire miners Gina Rinehart and Clive Palmer – face another major roadblock to their dreams of digging up the Galilee Basin and other coal-rich resources: The likely new prime minister of India is not a big fan of coal.
Narendra Modi, the leader of the Bharatiya Janata Party who is currently leading in the polls in the lead-up to the general election in May, is in fact a big fan of solar – and pioneered the first incentives for large-scale solar power in 2009.
As Bloomberg writes in this profile piece, if Modi wins the election: “One thing is clear: he’s signaling a clean energy revolution to end blackouts and revive economic growth.”
Some observers suggest Modi will effectively abandon most new coal projects and turn instead to solar, potentially increasing the government’s already ambitious solar target 10-fold. Vineet Mittal, managing director of Welspun Energy, a major Indian power producer and solar developer, told Bloomberg. “I wouldn’t be surprised if he came out with a 200,000-megawatt target by 2025.”
Interestingly, Modi’s home state of Gujarat enjoys the highest take up of solar in India, 40 per cent of the country’s capacity of nearly 3,000MW, and it boasts the least blackouts in the country.
India has been hamstrung for years by its chaotic infrastructure and the inability to deliver power reliably even to big business, let alone to some 300 million people without access to the grid.
As we reported last week, when noting that BHP Billiton had insisted that coal was the only option for emerging economies, including India, the fact is that in India, energy companies, big and small, are walking away from coal-fired generation because of the costs and the risks.
Much of the country’s easy-to-access surface coal has been extracted, with the remaining reserves harder to reach: underground, beneath cities or within national parks and tiger reserve. Imported coal is too expensive.
As Associated Press reports, solar is about to cheap to build as coal, and without the headaches.
“For the first time, solar electricity prices have fallen to near parity with India’s coal-generated power prices. Subsidies at about a third of cost put solar prices at about 7 rupees (11 US cents) per kilowatt/hour, versus coal’s 5-6 rupees per kilowatt/hour. Solar projects also need fewer clearances and take just six to 12 months to develop, versus about eight years for a coal plant.
“Today’s coal availability is inadequate. And investors are worried. In India, if there are coal shortages, there will be power shortages, and industrial growth will be inhibited,” said Vivek Pandit, senior director at the Federation of Indian Chambers of Commerce and Industry.”
Modi’s solar program in Gujarat lured investment from Essar Group controlled by the billionaire brothers Shashikant and Ravikant Ruia, and SunEdison (which recently agreed to sell solar power from a 150MW power plant in Texas for less than 5c/kWh)
Bloomberg quoted S.L. Rao, the head of India’s central electricity regulator from 1998 to 2001, as saying that the utility industry in India “has reached a stage where either we change the whole system quickly or it will collapse.”
“The power sector needs tough politics, and the only person in politics today who might be capable of that kind of toughness is Modi,” he said.
Coal currently generates 68 per cent of its electricity from coal. Most of this is supplied by the state monopoly Coal India, which sell it at a 44 percent discount to global prices. However, because Coal India is unable to guarantee deliveries, companies have sought contracts overseas, but then find themselves unable to make a profit on the prices regulated in India.
Bloomberg says India is already forecast to be the sixth-largest market this year, behind China, Japan, the U.S., Germany and Italy, Bloomberg New Energy Finance estimates. Its goal to make solar PV as cheap as coal by 2022 is on track to be reached at least five years earlier, aided by a plunge in solar prices and higher costs for oil, gas and coal, according to Tarun Kapoor, the joint secretary at the Ministry of New and Renewable Energy.
As Bloomberg reports:
“We have to focus on generating more power from our abundant renewable energy resources,” Modi declared at a rally for 10,000 supporters in central Madhya Pradesh state on Feb. 26. “The time has arrived for a saffron revolution, and the color of energy is saffron.”
Invoking the three colors of the Indian flag, Modi pledged an energy overhaul that would rival the so-called green and white revolutions in the 1900s. Those turned India into a major agricultural exporter and the world’s top milk producer.
“God has showered our country with an abundance of renewable energy,” Modi told the crowd of poppy-seed farmers gathered near a sea of reflective solar panels. “If these renewable resources were exploited properly, we wouldn’t have required mining coal or spending so much on importing crude and petroleum products
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The bad news for coal is piling up higher than the mountains of fly ash.
And I’ll be happy to see them both finally buried for good.
With promise from Modi, India is hoping to have a lot of Solar projects in the coming years.
India is a perfect candidate for solar. High cost of imported fuels, with particularly heavy dependence on Middle East producers. Plenty of affordable land, and a grid that needs tremendous investment if India wants to reach its economic potential to lift millions out of poverty.
Faster please.
India has also been installing a lot of hydro. That gives them a good fill-in for solar.
And India has a well-established wind industry including one of the leading wind turbine manufacturers.
Plus pollution worse than China’s.
Modi fixed the electricity industry in Gujarat with a radical policy. He split consumers into two groups: farmers, who would continue to get the cheap, subsidized electricity to which they’ve got accustomed – but not the whole day; and everybody else, who would get a 24/7 supply and pay the market rate for it. He got away with it, perhaps because farmers are used to getting irrigation water on the same basis.
Modi is an example of a careerist politician taking up solar not out of environmental conviction but because it works for him politically. Eduardo Campos in Brazil, the ambitious governor of Pernambuco who recently carried out Brazil’s first solar-only auction, is another of the same stripe. We will see more of them.
The split among types of consumers can be seen in all states in India. Residential, commercial, industrial (with several sub-categories) and agricultural. Electricity rates for all these segments are different.
Just to point out in the context of the headline of this article, Gujarat also has two of the largest coal-fired power plants in India. Adani Power’s Mundra Thermal Power Plant (4,620 MW) and Tata Power’s Mundra UMPP (4,000 MW).
I don’t like Modi for his slaughter of Muslims, but this is good news. It’s smart and pragmatic to give farmers less electricity but cheaper and the general public more as more expensive. It makes sense as a policy and it should be expanded to every state with a good level of planning and then blessing from the Lord
Hopefully Modi will focus more on improving the independence, cleanliness, efficiency and development of India than killing Muslims.
Really hope the Modi solar agenda goes through. In combination with China reportedly planning to cap its CO2 from coal in a few years, it could mark peak coal for the planet – as in peak demand, not peak supply.
Meantime, there’s a very intriguing low tech innovation coming out of India. Its called the Mitti Cool clay fridge. Its a small peasant fridge made out of a special formulation of highly porous clay that keeps the interior cool with ambient moisture evaporation. And I think the effect could easily be augmented with a micro solar fan.
We invented that over 100 years ago
http://en.wikipedia.org/wiki/Coolgardie_safe
The description you shared involves the use of a lot of metal, which can be difficult to access and beyond the budget of the poor in developing countries. I believe the one Doug describes is much like the one the enterprising young lady from Great Britain came up with for a school project to help the disadvantaged in Africa. With the majority of the material being clay or hand formed pottery, in other words materials they could go out and dig up. Which helps to make it much more accessible and easier to implement for the very poor. But still able to keep milk or meat cool enough not to spoil in the heat of the day, and this style is activated by the heat of the sun and not so reliant on the wind. Apologies for not having the link handy, but a quick search should turn it up if you are curious.
Ah Ha! The Coolgardie. Love the name. Obviously not possible to get down to 5 degrees centigrade with these. Still I wonder if there’s some hybrid design that could yet produce a super efficient fridge that runs on micro-solar. Thanks for the link.