Clean Power

Published on October 19th, 2014 | by Smiti


India Expands Solar Power Target, Will Add 15 GW Over Next Five Years

October 19th, 2014 by  

The new Indian government has delivered on its promise to enhance the solar power capacity addition targets under the ambitious National Solar Mission announcing revised guidelines for capacity allocation.

Gujarat Solar Park

The Ministry of New and Renewable Energy recently released revised guidelines for auction of solar photovoltaic power projects with a significant hike in overall capacity. As per the revised target (pdf), the government plans to add 15 GW of solar power capacity by Q1 2019. The first of the auctions to meet these new targets will involve 1,000 MW of capacity.

Under the original National Solar Mission target, India had planned to add 9 GW between 2014 and 2017 and an additional 10 GW between 2018 and 2022. The current installed solar power capacity in India is just under 2.7 GW.

The 1,000 MW capacity will be set up as a solar park or ultra mega solar power project in the southern state of Andhra Pradesh. Similar projects, with capacity of 500 MW or 1,000 MW, can be expected over the next few months. Several states, including Punjab and Telangana, have signed agreements with the Solar Energy Corporation of India to set up such projects.

A proposal (pdf) issued in July this year would have seen the SECI offering 750 MW capacity at the auction. This was to be part of bigger tranche of 1.5 GW. The capacity on offer in the first tranche of the new proposal is 3 GW. The second and third tranches will have 5 GW and 7 GW capacities on offer, respectively.

Power Sale

The mode of power sale from the solar power projects will be similar to that adopted, and in practice, during the first phase auctions of the National Solar Mission in 2010. The 1,000 MW solar power capacity will be bundled with 500 MW thermal power capacity and then sold to power utilities in Andhra Pradesh. This mode reduces the overall cost of electricity per unit and enables the utilities to procure solar power and conventional power from a single entity.

Prospective project developers will be allowed to bid for up to 50 MW per project capacity while a company can bid for a cumulative capacity of 250 MW. Developers will be selected through a process of reverse auctioning.

Domestic Content Requirement

Another interesting aspect of the revised proposal is the reduced proportion of capacity that is required to be commissioned using domestically manufactured PV modules. In the earlier proposal, a third of the 1.5 GW capacity was reserved under the domestic content category while under the new proposal, only a fourth of the 1 GW capacity will be under this obligation.

The decision to reduce this proportion comes weeks after the Indian government decided not to levy anti-dumping duties on imported PV modules.

Wafers (in case of crystalline PV modules) and starting substrate (in case of thin-film modules) can be imported but the final assembly of modules would be required to be completed in India. This may encourage international module manufacturers to set up assembly plants in India.

The enhanced capacity addition targets are in line with the government’s overall target to have installed renewable energy capacity of 100 GW before the end of this decade. The government also plans to add 10 GW wind energy capacity every year. India’s current installed renewable energy capacity stands at about 32.5 GW.

Image Credit: Gujarat Power Corporation Limited

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About the Author

works as a senior solar engineer at a reputed engineering and management consultancy. She has conducted due diligence of several solar PV projects in India and Southeast Asia. She has keen interest in renewable energy, green buildings, environmental sustainability, and biofuels. She currently resides in New Delhi, India.

  • Adam Grant

    Relative poverty may turn out to be an advantage for small-scale solar PV in India. Why go to the expense of building the grid out to each village once a whole village can be served by community-scale solar + storage?
    Micro-grid scale storage will make increasing sense as costs fall and ease of installation improves. Net metering will allow individual households’ solar panels to participate in a village grid.

  • Larmion

    15GW over 5 years works out to an average of 3GW a year. That’s a very small fraction of the fossil fuel capacity India is due to install over the same period, so solar will remain marginal.

    India receives a lot of credit on this site, despite generating a horrible amount of carbon pollution per unit of GDP. Meanwhile, CleanTechnica is endlessly criticizing countries like Australia and the US, both of which have a more energy efficient economy (not that I’m defending those two, all I’m saying is they are a little bit less horrible than India).

    India is of course a developing country that’s still battling severe energy poverty, so they deserve some leeway. But that doesn’t mean the grand promises of the new government shouldn’t be placed in a more critical context.

    • Will E

      Its the change of mind happening now in India that is important.
      Solar and Wind figures will speed up in India as in China.
      In Australia, there is no mind change.
      if there is, it is in reverse .

      • Larmion

        What ‘change of mind’? Promises to build relatively minor quantities of renewable energy alongside massive investment in fossil fuels and considerable investment in new nuclear?

        Australia already has a higher renewable electricity share than India will have even if all currently licensed and fundend projects are built.

        Coal is still king in India; it is being built on a far larger scale than any other energy source and would be even more popular if the national coal monopoly were slightly more competent at mining it.

        India’s renewable strategy cannot be compared to that of China. China already has a significant renewable share (mostly thanks to hydro) and is adding more renewables at a sufficiently fast pace to actually halt the rise of coal. India is nowhere near that stage yet, despite having better solar and wind resources than China.

        • Karn

          Err .. If you count hydro as “renewable” India has a far larger share of energy production as compared to China .
          But yes you are right there are too many articles on India on this site giving a rather skewed version of events .

          • Skewed because India doubled its coal tax in July this year unlike abolishing it like Australia did. Skewed because you won’t find politicians questioning the science behind climate change. Skewed because you won’t find anyone asking to reduce renewable purchase obligation.

            I write most of the India articles on this website. If there are problems I do highlight them. If you read them you will see that I have mentioned a number of times that many utilities are not in the condition to meet their RPO. When the previous government withdrew a financial incentive to the wind energy industry I published an article about it. When the new government re-introduced it I published an article about it.

          • Karn

            Why compare oneself with the worst examples ? The point is these efforts are small compared to the expansion of coal . The share of renewables in Indias energy mix will not change appreciably

          • Larmion

            I do not doubt India’s politicians grasp of climate change, nor the sincerity of their promises. And I most certainly do not condone Australia’s policy on coal (side note: India is a major consumer of Australian coal).

            However, I can only judge countries on what they achieve. India’s renewable capacity isn’t growing at a sufficient pace to halt the rise in fossil fuel usage (and the carbon picture would be even bleaker if it was not for India’s nuclear ambition), and that is making the very optimistic assumption that all proposed renewable projects make it to completion – something that isn’t even realistic in a country like China or Germany, never mind India.

            I appreciate your articles very much. India is a hugely important country and one that receives far fewer media attention than its sheer size and future prospects warrant. However, the vast majority of what CleanTechnica writes about India are articles about proposals for renewable energy projects. To someone who isn’t familiar with India that might give the impression that it is undergoing some sort of Energiewende, which couldn’t be further from the truth.

            It would be informative if you would put the numbers you present in their context: how does target X or milestone Y stack up against the increase new coal, new nuclear or new gas? Are India’s carbon emissions going up or down?

          • Since this is a blog only about renewable energy we usually do not cover fossil fuels but comparison with conventional energy is good suggestion from the reader’s prospective. The reason there are so many ‘good’ renewable energy stories coming out of India is because there has been a change in the government earlier this year which is pushing for renewable energy expansion at a rate not seen for decades.

          • Dragon

            I’d also appreciate some context. Like what percent of new energy installs are renewable vs fossil, how has that changed in the last few years, how fast will CO2 emissions rise or fall with this new plan and how does that compare to previous years, etc.

        • You will find that renewable energy has different meaning in different country. In India hydro power projects above 25 MW capacity are not considered as renewable. Include all hydro and you’ll see ‘renewable energy’ capacity has a share of about 29% in installed capacity in India.

          Why compare emission intensity, why not compare emissions per capita. Does Australia have a market-mechanism to address GHG emissions directly or indirectly? Does the US have a carbon/coal tax? India has both.

          • Zer0Sum

            I agree that it would be very helpful to get the running total on the actual percentage of capacity in India versus the FF capacity. The recent flurry of articles are slightly biased towards the optimistic in that regard which is not a criticism but just an observation. There is no need to gloss the data. The more detailed information we have on the actual transitional process the better it is.

            The same could be said for every other article though so don’t over do it. Maybe just a single article focusing on the details which you can refer to in all the others. Write a new one every time a major change occurs.

            Lisa does a pretty good job of managing that but her articles tend to be more indepth in general.

    • Karn

      15 GW “increase” . Over the original 20 GW target .

      • Increase to 15 GW over original 9 GW.

        • Karn

          Not according to the government website .

          • Have you seen the links in the article above? Check page 3 of both the PDFs; and both the documents have been issued by the Ministry of New & Renewable Energy, Government of India.

          • Karn

            My mistake I took that to mean over the total 20 GW target .

        • Zer0Sum

          You could make that clearer in the article. ex. in the first paragraph you could add “from 9 to 15GW”.

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