The recent nationwide power outages in India have raised serious questions about the reliability of the country’s ageing electric grid.

Having grown up in Chennai, I have seen firsthand, the effect of daily power cuts in the city. I can only imagine how bad things must be in other parts of the State.

While it is important to invest in upgrading the current grid infrastructure, India must take a cue from Germany and Spain (recent events notwithstanding), and aggressively promote solar photovoltaic energy by the use of feed-in tariffs.

Feed-in tariffs are a mechanism by which a renewable energy producer signs a long-term contract with a buyer (potentially the state government agencies engaged in energy generation, transmission and distribution) to supply renewable energy at a fixed rate over a fixed period of time.

Over time, this tariff is lowered in order to encourage technological innovation and achieve grid parity (when the price of electricity from renewable sources equals that from conventional sources). This has been the most successful policy mechanism in accelerating renewable energy deployment globally. Further, this policy enables regular people to own and sell electricity generating assets.

The high upfront cost of solar photovoltaics is cited as the reason for their slow deployment. While this is true, it is important to know that solar panels themselves are only a small portion of the cost of an entire solar photovoltaic system.

The major costs relate to Balance-of-System – mounting structures, brackets, additional power electronics (inverters) and batteries – and installation labour.

Therefore, emphasis must be placed on lowering these costs, not just the costs of the panels alone.

India must make the most of its solar resources.

Solar photovoltaics have the potential to be a driver of economic growth while helping solve the power problem.

The Ministry of New and Renewable Energy must look at what other developed countries have done and adopt similar policy mechanisms in order to accelerate the growth of renewable energy technologies.

(Tejas is studying sustainable systems and energy systems engineering at the University of Michigan, Ann Arbor, US.)

(This article was published on December 2, 2012)
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