Rise and shine

Delhi, which has the dubious distinction of being the world’s dirtiest city in terms of air quality, has taken an important step forward in encouraging the use of cleaner energy alternatives, by operationalising rooftop solar power generation by individuals and institutions. Two distribution utilities in the national capital have implemented ‘net metering’, which allows consumers to generate solar power at their premises, which is netted off against the quantum of power they consume from the grid. With most parts of India enjoying over 300 days of sunshine a year, rooftop solar power can considerably add to the overall availability of power, thus ensuring consumers both better quality of supply, with fewer outages, and freeing up power availability to service other consumers. A Greenpeace study estimated that the capital’s over 31 sq km of rooftops can generate over 2,500 MW of power — almost 70 per cent of its average consumption! However, that is on paper. In reality, rooftop solar power has failed to take off because of a number of regulatory, financial and infrastructural issues, which need holistic policy intervention from the Centre in order to make this concept a viable reality.

India has favoured large-scale, grid-connected solar generating plants, since they throw up fewer technological issues and offer a clearer route for subsidies and taxation. Rooftop solar, on the other hand, poses several hurdles. For individuals, the first barrier is financial. Consumers have to invest upwards of ₹5 lakh in equipment in order to be able to connect to the grid. Bank financing is limited, since most lenders are unfamiliar with the area and reluctant to lend, given the parlous state of discom finances. Scaling rooftop generation beyond a point poses other technical problems — utilities claim, for instance, that grids become unstable if more than a fifth of the power is generated from solar units at the tail end. Generation will also have to be halted during outages to protect linesmen working on repairs. All this requires investment in new technology and monitoring systems, some of which are difficult to integrate with the legacy infrastructure available in most of our cities. Costing of the grid support offered to individual generators is another issue.

Commercial and industrial establishments take the lead in rooftop solar; as high volume consumers, they pay a higher tariff, but can avail tax benefits like depreciation, which reduces their actual cost. Germany, which has a very high penetration of rooftop solar, has used tax incentives to create renewable energy service companies, which buy rooftop power from consumers and supply grid power to them at tariffs which are fixed for a long period, say 20 years, which makes it viable for consumers as well. If rooftop solar is to become a reality, the Centre as well as States have to work on developing a holistic policy which addresses the concerns of all stakeholders, and make such investments more bankable and tax friendly. Power utilities also need to look beyond short-term revenue concerns to the longer term stability, as well as market expansion possibilities offered by rooftop solar power.

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