Use of renewable energy is increasing around the world, with European countries leading the way. The photovoltaic industry is growing globally, but due to decrease in government incentives and subsidies in European economies, owing in part to the debt crisis, the market paradigms are shifting. The solar industry is witnessing an increase in the drive towards solar energy in other non-European economies such as China, the US, Japan and India.
The Chinese company Suntech has now become the leading solar PV manufacturer in the world, with PV capacity exceeding 1GW. China also laid claim to the world’s largest solar park in Golmund, which produces 200MW of energy. India now plans to build an even bigger solar park in the state of Gujarat with a 214 MW production capacity.
The Indian economy has gone through continuous growth of 8 to 9 percent annually, even during the global financial crisis. With the economic growth, the energy demands have also increased. With more than a billion in population, more than 50 percent have no access to electricity with 28 million people living below the poverty line. To lift its population from the depths of poverty, the Indian government believes that it needs to invest heavily in its energy infrastructure.
The country relies mainly on coal power for its massive manufacturing industry and is the fourth largest emitter of harmful greenhouse gases. Up until last year, India produced nearly 8% of its energy needs from renewables and is the leading producer of wind power energy.
In 2010, the Indian government approved its first ambitious solar power plan called the ‘Jawaharlal Nehru National Solar Mission’ (NSM), which aimed at increasing the solar power capacity from less than 5MW to 1000MW by 2013, and 20GW by 2020. The mission recognizes that India’s unique tropical climate, its high daily solar energy incidence of 4-7kWh/m2, and 1500 to 2000 sunshine hours per year make it an ideal country for solar energy production.
Then, in October 2011, Spanish Abengoa Solar established India’s first concentrated solar thermal power plant in the state of Haryana, some 35 kilometers away from the capital of New Delhi. The plant has a production capacity of 3MW and is used to catering to the energy needs of the Indian Institute of Technology.
India’s Reliance Power, owned by billionaire Mr. Anil Ambani, commissioned India’s first large-scale solar power plant with a production capacity of 500MW, at a cost of $1.14 billion. The plan was supported by the Chief Minister of Rajasthan Mr. Ashok Ghelot and the NSM. The plant became operational in March 2012 and started producing 40MW.
The state of Gujarat, on the other hand, is leading the way with solar energy initiatives. It was host to the India Solar Investment and Technology (ISIT) summit held from 19th-21st April. The summit was attended by senior government officials including the Gujarat Chief Minister Mr. Narendra Modi, and more than 10,000 attendees including leading solar cell and module manufacturers, suppliers and developers from around the world.
As mentioned above, the highlight of the summit was the certificate distribution of projects valued at 604.89MW, including the inauguration of the world’s biggest 214 MW solar park near Gandhinagar, Gujarat, commissioned under the Gujarat Solar Policy.
The summit also included representatives of Asian Development Bank, who awarded funding of $500 million to the Gujarat government for solar research and development, while US Consul General Mr. Peter Haas has also donated a similar amount to support the country’s rising solar energy sector.
The small town of Gandhinagar, previously considered a wasteland, has witnessed a change in its fortune when it became host to the massive solar park. It was chosen in accordance with the Clinton Climate Initiative report of 2010, which marked the area with high “direct normal irradiance levels”.
This week, Mr. Modi also laid the foundation for the world’s first 1-MW canal-top solar power plant in the Mehsana district of Gujarat. The project is a novel idea as it covers an entire 750m branch canal with hundreds of solar panels, thus eliminating the need for acquiring separate land.
The project not only produces electricity, but also saves 9 million liters of canal water from evaporation. Furthermore, the temperature of the water flowing below the solar cells lowers their temperature and therefore improves their production by up to 15 percent.
According to Mr. Gurdeep Singh, MD Gujarat State Electricity Corporation, if the state is able to cover just 10 percent of the entire 19,000 km of canal network then India could produce 2400MW of solar energy and save 2 billion liters of water annually. Furthermore, the project would involve substantial cost savings as it eliminates the need to acquire 17 square miles of land for solar cell installation.
Currently, the industrial and commercial users pay between $0.13 and $0.23 per unit consumed to conventional power generators. The government of India has set a benchmark price of approximately $0.13 per unit, which will be paid by the government to private solar energy producers through 25-year mutually obligatory Power Purchase Agreements (PPA). These agreements promise guaranteed payments, but lower profit margins, with little or no risk. Some private operators are instead giving power directly to the consumers at a higher rate. Some households and many commercial consumers prefer such arrangements as private operators guarantee a continuous supply of energy whereas government suppliers suffer from frequent power failures.
The Indian solar PV market is growing continuously. From 40MW last year, it is expected to produce more than 600 MW by the end of the year. Although the low benchmark price set by the government might not be enough to lure foreign investor, there is a growing demand for “open access” systems where consumers can get uninterrupted power directly from the producer. If everything else goes well then India could easily reach the 1000MW mark set under the National Solar Mission for 2013.
