Policy

Solar rooftop segment awaits policy sunshine

V Rishi Kumar Hyderabad | Updated on June 07, 2019 Published on June 07, 2019

Though they are buoyed by the sector’s prospects, players look for govt support

Ground-level implementation issues, last-mile problems, netmetre-related concerns and inadequate finance options are all leading to a slower-than-projected growth in the solar rooftop segment in the country.

This is in spite of the Central government’s stated objective of promoting the rooftop segment across domestic, commercial, and industrial sectors.

While problems vary from one State to another, vendors seek a broad regulatory framework that could brighten the horizon.

Interactions with various players show that though the sector holds huge promise, they want State governments to address concerns to pave way for accelerated growth.

Sanjay Banga, CEO, Tata Power Delhi Distribution Ltd, said: “It depends on which State we are talking about in terms of solar rooftop installations. It makes perfect economic sense, as the average procurement cost has come down to about ₹2.60-3 a unit as against ₹4 a unit for thermal power at the peak purchase price.”

However, when it comes to Delhi, there is no incentive for setting up a solar rooftop in the domestic sector, as the tariffs are low and 50 per cent of around 400 units per month is subsidised by the State. Of the 1.6 million consumers, 1.4 million use below 3 kwh capacity, he said.

But in the commercial and industrial cases, it works out well, as consumers save about ₹ 3-4 per unit when they install a unit or source solar power.

Billing issues

Gautham Nalamada, Executive Director, Photon Energy, said: “There is a case for improving the netmetreing system with better-quality smart-metres. In the current scenario, there are a number of complaints about improper billing when excess power is exported from the unit to the grid.”

Hence, both vendors and consumers are unhappy as the billing goes awry.

States would have to look into the issue of how much can be carried forward and reverted to the consumer when there is excess production.

In Andhra Pradesh, an innovative scheme has been initiated, wherein consumers are offered a 1-kwh solar unit for ₹49,000, with an upfront payment of ₹15,000.

The rest is met with State and Central government funding. The State Discom is offering 12,000 kits, of which Photon is executing an order for 3,500 kits, Nalamada said.

According to a Mercom report, rooftop installations were down by 33 per cent during the first quarter. Raj Prabhu, CEO of Mercom Capital group, stated in the report that after four quarters of solid growth, the decline was due to difficulty faced in securing required approvals. However, the segment is expected to bounce back in the second half.

Vendors at the recent ‘Renewable Expo’ in Hyderabad were optimistic, and expressed hope that the sector would embark on an accelerated growth phase.

However, they were concerned about lack of customised financing options, constantly evolving Central and State policies related to taxes, net metreing hurdles, subsidy delays and lack of consumer awareness, which, in turn, led to slow growth.

During the Expo, Ajay Mishra, Principal Secretary Energy of Telangana, had said that with tariffs going up to ₹9 per unit for some domestic users who consume more power, it would be benefitial for them to install rooftop units tosave on their power bill. They will not need any subsidies. The payback works out to 3-4 years. Both domestic and commercial users can gain with solar installations.

Published on June 07, 2019

A letter from the Editor


Dear Readers,

The coronavirus crisis has changed the world completely in the last few months. All of us have been locked into our homes, economic activity has come to a near standstill. Everyone has been impacted.

Including your favourite business and financial newspaper. Our printing and distribution chains have been severely disrupted across the country, leaving readers without access to newspapers. Newspaper delivery agents have also been unable to service their customers because of multiple restrictions.

In these difficult times, we, at BusinessLine have been working continuously every day so that you are informed about all the developments – whether on the pandemic, on policy responses, or the impact on the world of business and finance. Our team has been working round the clock to keep track of developments so that you – the reader – gets accurate information and actionable insights so that you can protect your jobs, businesses, finances and investments.

We are trying our best to ensure the newspaper reaches your hands every day. We have also ensured that even if your paper is not delivered, you can access BusinessLine in the e-paper format – just as it appears in print. Our website and apps too, are updated every minute, so that you can access the information you want anywhere, anytime.

But all this comes at a heavy cost. As you are aware, the lockdowns have wiped out almost all our entire revenue stream. Sustaining our quality journalism has become extremely challenging. That we have managed so far is thanks to your support. I thank all our subscribers – print and digital – for your support.

I appeal to all or readers to help us navigate these challenging times and help sustain one of the truly independent and credible voices in the world of Indian journalism. Doing so is easy. You can help us enormously simply by subscribing to our digital or e-paper editions. We offer several affordable subscription plans for our website, which includes Portfolio, our investment advisory section that offers rich investment advice from our highly qualified, in-house Research Bureau, the only such team in the Indian newspaper industry.

A little help from you can make a huge difference to the cause of quality journalism!

Support Quality Journalism
This article is closed for comments.
Please Email the Editor
You have read 1 out of 3 free articles for this week. For full access, please subscribe and get unlimited access to all sections.