By Ishan Chaturvedi
As we are moving closer to the devastating effects of Climate Change and the surface temperature rises to 1.5˚C we can judge the effects. Here in India, we are seeing cloud bursts at high-altitude places like Kedarnath, and Shimla, floods in Bangalore, and droughts in places that have never faced water shortage. These issues make it evident that there is a shift in everyday conditions. This is why it is important to make strides in the realm of clean energy.
Solar has been at the paramount contributing to more than 39% of renewable installations in India. It has been a game-changer promising both environmental sustainability and economic growth. Now, with ambitious targets and significant investments, India’s future in solar energy is looking to take India towards Energy self-reliance. As any developing nation needs cheap and reliable energy to fuel its booming economy needs, Solar Technology is well on its way to bring that shortly. As the country’s target to have 50% power from renewables by 2030 stands tall, Solar is reaching every doorstep. So, yes from humble beginnings in 2010, Solar has become India’s revolution to reach its Renewable Targets.
In the past decade, India has witnessed remarkable growth in its solar energy capacity. The country’s total installed solar power capacity has reached 70 GW mark in 2023. This growth can be attributed to various government initiatives, subsidies, and favourable policies aimed at promoting solar energy.
To encourage investments in the solar sector, India offers various incentives, including tax benefits and subsidies. Additionally, initiatives like the International Solar Alliance (ISA), co-founded by India, aim to mobilize investments in solar projects on a global scale. These efforts will create a conducive environment for both domestic and international investors. As investments have started to flow from big to small, solar energy is being made more affordable and accessible.
Solar financing will play one of the major roles in the coming year for the solar sector in India and will take centre stage. Retail finance in the Solar Sector is still an area where a lot of NBFCs are flourishing and I am sure this will soon gauge the interest of Major Financial Institutes in India. Currently, the offerings include 9% – 11% flat rates in retail finance without collateral and there are World Bank-backed bonded funds available through a few centralised banks for commercial scale finance. Many private banks have tried to catch up to the international market for large scale utility projects but lower international interest rates using hedged ECB funding are still giving them a run for the money. I feel there will be a closing of the gap act in play soon as access to foreign capital is booming right now.
Another important aspect is the technological shift from gas to batteries to be a budget-friendly economy. This has led to innovations like EVs become accessible with many Indians having access to the holy grail of being able to charge their EVs using the sun through Solar Power. The per km cost of travel has been reduced to Rs.2/km from Rs.10-20/km.
Hydrogen Electrolysis is the upcoming technology. One of the major changes the Energy Industry has seen in the past two decades is access to clean energy. Currently, we are going through a cycle of changes to the conventional thought process regarding energy. As storage technology takes leaps each year with better access to funding, innovation being key and increased domestic production of lithium-ion cells as well as other technologies the day is not far when every Indian will be self-sufficient and accountable for their energy needs.
Recently, a friend of my father contacted me with a problem which I am hearing about more and more these days. He has purchased a land parcel on the outskirts of Jaipur where he wanted to move with his wife but the problem was that he had access to only an agricultural connection at his land wherein power is supplied 8 hours a day as it is heavily subsidised. Agricultural connections are majorly used to power pumps to draw water in agricultural fields. In addition to this, getting a 24-hour connection would cost a lot as a separate line will have to be set up from the grid substation to his land which would’ve been an out of his pocket expense and a large one at that. After a small catch up he informed me of his situation and asked me “Is Solar the Answer?” I replied with a smile on my face “Yes”. I asked him to inform me of all the loads that he plans to run on a day-to-day basis, what is an absolute must and what is recreational. After a study of his requirements I told him to get Solar installed for the basics which are connected with the agricultural connection and to have a backup solution in place with batteries which can power his requirements for the 16 hours power when is unavailable. The logic behind my advice was that the simple cost of power through a Grid Connected Solar Plant is Rs.2 to Rs.3, the cost of government power from the agricultural connection is Rs.5 per unit (again heavily subsidised) and the cost of power through batteries is Rs.10 to Rs.12 so, the solution makes the most sense in the per unit cost method. A couple of months later I got a call from him again where he wanted to thank me for my time and efforts. He informed me he had successfully moved out of the city to the calm and quiet of his house close to nature.
Here, I didn’t ask him to go Off the Grid in the first go itself but do it slowly as his demand increases with time the argument being the falling prices of Power Storage Solutions and improving Grid reliability.
Many new technologies and methods are emerging in which one can switch to a reliable and sustainable solution a few of them being:
- Agrivoltaics: Installing solar plants in such a way that the land underneath does not go to waste and agriculture can be done there. This is maximizing land use and profits both. The land owner can still farm his land and use the generation to power his requirements. The trend is gaining pace as India has vast agricultural lands which are key for food security and exports. Agrivoltaics are being used to power Green Houses which are proven to increase agricultural efficiency many fold.
- BIPV(Building Integrated Photo-Voltaic): These are Solar Panels specially manufactured to be used as Solar Facades, Solar Walls, Solar Windows and have many more application possibilities. In general these panels allow sunlight to pass through them with gaps in between Solar Cells. These are not the most efficient panels but provide an excellent alternative to zero ROI glass facades, walls and windows. India has a high demand of the same and the demand is steadily increasing whereas the supply from Indian manufacturers is very limited and I can see substantial investments in the coming time.
- CAPEX+: A new business model specifically designed for us Indians. Many businesses in India work tirelessly in their respective fields to cater to the increasing economy demands and quite frankly don’t have the background to take care of a Solar Plant and correctly deem it as a liability as they would much rather like to focus on their own work than on a purchase and having someone else install a plant for them giving them a pocket change delta of Re.1 or Re.1.5. The solution CAPEX+, a model with Collateral Free Finance with all the benefits of a Solar Plant Ownership minus the hassles of maintaining a Solar Plant.
To conclude, the future of solar energy in India is undeniably bright. The nation’s commitment to clean energy, ambitious targets, and supportive policies have set the stage for continued growth in the sector. As the world grapples with climate change and the need for sustainable energy sources, India’s progress in solar energy is not only commendable but also serves as an inspiration for other nations. Along with the right investments, technological advancements, and effective policies, India is well on its way to become a global leader in solar energy, contributing significantly to a cleaner and more sustainable future.
(The author is Ishan Chaturvedi, Co-Founder & Director at Vareyn Solar Pvt. Ltd., and the views expressed in this article are his own)
