The ramp-up in solar power generation capacity and its competitiveness could disrupt traditional power generators, consultancy firm KPMG said in a report released on Monday.

“The disruptive force is expected to start being felt from 2017 and may accelerate post 2020. In some States which are promoting solar (and wind power) aggressively, conventional coal generators could see their plant load factors fall by as much as 10-15 per cent by 2020,” it said.

The report was released today at KPMG’s annual energy conclave, ENRich 2015. It added that the drop in PLF of coal-based power generators due to increased solar power capacity could accelerate after 2020.

The report expects India to add at least 20,000 MW of solar power capacity each year after 2020.

“The price of solar power has seen a decline and today prices are within 15 per cent of the coal power prices on a levelised basis. Solar rooftop power is already competitive compared to grid power for many consumers and as per the report, if combined with storage, it would be cheaper than grid power after 2022 for a large section of consumers,” the report stated.

Santosh Kamath, KPMG’s Partner and Head – Renewable Energy Services, added that solar power and storage are exponential technologies.

“The rapid rise is good for India and may help the country leapfrog to clean energy sources to meet its needs. However, the sector needs preparation by all stakeholders — power generators need to become flexible, distribution utilities should be efficient to retain customers and coal sector has to become cost-efficient,” he added.

KPMG’s report also highlighted the need to strengthen the planning infrastructure and processes. “The right incentives for investments in grid integration of solar and balancing services should be put in place early,” it suggested.

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