Govt of Tamilnadu announced unique Solar Energy Policy on Oct 20, 2012 The Chairman of TANGEDCO (Tamilnadu Generation and Distribution Corporation) briefed the features of the Policy to potential Investors on Nov 23, 2012 RLCPPL offers EPC Contracts on Turnkey basis. This includes Project Study, Engineering, Design, Technical Support, Sourcing, Vendor Negotiation,Building and Commissioning of Solar Power Projects. Do you want to set up a Solar Power Plant, mail us your interest to: info@rlcppl.com. Visit us at http://www.rlcppl.com/
National Solar Mission

Present Solar Energy Scenario in India

National Solar Mission, Solar Plants in india, Solar power, Solar PV, Solar power projects in Tamil Nadu

With an installed capacity of 145 GW, the country currently faces energy shortage of 8 percent and a peak demand shortage of 11.6 percent. India faces a significant gap between electricity demand and supply. Demand is increasing at a very rapid rate compared to the supply. In order to sustain a growth rate of 8 percent, it is estimated that the power generation capacity in India would have to increase to 306 GW in the next ten years which is 2.1 times the current levels.

According to the World Bank, roughly 40 percent of residences in India are without electricity. In addition, blackouts are a common occurrence throughout the country’s main cities. The World Bank also reports that one-third of Indian businesses believe that unreliable electricity is one of their primary impediments to doing business. In addition, coal shortages are further straining power generation capabilities.

India has a vast potential for renewable energy sources, especially in areas such as solar power, biomass and wind power. With the current installed capacity of renewable energy constituting about 7.3 percent of India’s total installed generation capacity. India is already the fourth largest in the world in terms of wind energy installations and we are seeing significant investment activity in this area. Technological breakthroughs for cost-effective photovoltaic technology could generate a quantum leap in the renewable energy sector since India is well endowed with solar isolation (average of 6 kWh/ sq.mt./day).

India just had 2.12 megawatts of grid-connected solar generation capacity. As per National Solar Mission, the first phase covers setting up of 1,100 MW of grid solar power and 200 MW capacity of off-grid solar applications utilizing both solar thermal and photovoltaic technologies, by 2013. In second phase by 2017 the installed base would reach 4000 MW, and in third phase 20,000 MW by 2022. India has an enormous potential of renewable energy across the various sources as indicated in the table below.

Resource Potential Existing Installed capacity
Wind 45000 MW ~7660 MW
Small Hydro (upto 25 MW) 15000 MW ~1850 MW
Biomass power/ Cogeneration 19500 MW ~950 MW
Solar Photo Voltaic Power 50000 MW (20 Mw/sq.km) 50000 MW (20 Mw/sq.km)
Solar water Heating 140 million sq. m collector area 1.5 million sq. m collector area
Urban & industrial waste – based power 70000 MW ~34.95 MW

To achieve this, the Mission targets are:

To create an enabling policy framework for the deployment of 20,000 MW of solar power by 2022.

To ramp up capacity of grid-connected solar power generation to 1000 MW within three years – by 2013; an additional 3000 MW by 2017 through the mandatory use of the renewable purchase obligation by utilities backed with a preferential tariff. This capacity can be more than doubled – reaching 10,000MW installed power by 2017 or more, based on the enhanced and enabled international finance and technology transfer. The ambitious target for 2022 of 20,000 MW or more, will be dependent on the ‘learning’ of the first two phases, which if successful, could lead to conditions of grid-competitive solar power. The transition could be appropriately up scaled, based on availability of international finance and technology.

To create favourable conditions for solar manufacturing capability, particularly solar thermal for indigenous production and market leadership.

To promote programmes for off grid applications, reaching 1000 MW by 2017 and 2000 MW by 2022 .

To achieve 15 million sq. meters solar thermal collector area by 2017 and 20 million by 2022.

To deploy 20 million solar lighting systems for rural areas by 2022.

Challenges for the Sector

The major issues currently being faced by the renewable energy sector are as the following.

High capital costs and low plant factors raise the cost of renewable energy. However, technological evolution and the huge power deficit make renewable an active choice for power utilities, especially in the future years.

Private sector interest is dependent on regulatory certainty on tariff and other conditions.

Increased competition for land use in certain renewable technologies needs to be managed.

Lack of grid presence or transmission capacity in remote areas where renewable energy opportunities exist, is a major constraint in power evacuation.

The high cost of solar cells remains a barrier in development of solar energy market in Asia. According to various surveys, If Solar PV costs can be brought down (across the value chain module cost + BOS cost + logistics/distribution costs + installation costs + customer support costs) there is a potential market of 25 GWp in rural electrification of developing Asia/Africa.

Regulatory Policy and Framework

Some of the key legislative, policy and other measures initiated by the various stakeholders for promoting RES are:

The Electricity Act provides for State Commissions to fix a minimum percentage for purchase of energy from renewable energy sources.

The policy recognizes that renewable energy sources should be offered preferential tariffs till they can evolve and compete with other conventional sources.

Generation and distribution in notified rural areas have been de-licensed.

Fiscal benefits and financial support has been extended to interested investors.

A number of fiscal benefits in form of duty exemptions, income-tax holidays, accelerated depreciation norms, etc have been extended.

Recently announced National Solar Mission as an initiative towards National Action Plan on Climate Change for promotion & development of solar power in the country announces ambitious plans of capacity addition to the tune of 1000 MW by 2010-2013, 20,000 MW by 2022 and mandates solar power purchase obligation of 3% by 2022.

In addition, NTPC Vidyut Vyapar Nigam Limited will be the Nodal purchaser of Energy, which will ease the power sales.

Central Electricity Regulatory Commission (CERC) has recently announced a levellized feed-in tariff for solar power projects.

Solar Photovoltaic power:

Solar Photovoltaic Cell (SPV) converts solar energy to DC electricity through photoelectric effect. Photons from Sunlight hitting the Solar Panel are absorbed by semi conducting materials i.e. Silicon in the Cell. Negatively charged electrons are knocked loose from their atoms, allowing them to flow through the material to produce electricity. A grid-connected inverter converts this DC power generated by the PV module into suitable AC power for evacuation at desired grid voltage.

Though there are different SPV technologies available for energy conversion viz. mono-crystalline, polycrystalline, thin film (a-Si, CdTe, CIGS), RLCPPL for this particular project has decided to adopt a-Si technology which is more proven and apt for this particular project location.

Policy drivers & Market:

The recently announced National Solar Mission as a part of National Action Plan for Climate Change opens up the scope for commercialization of Solar Energy as a source of power as it envisages;

1. Capacity addition of 1000 MW by 2013 & 20,000 MW by 2022

2. State Solar purchase obligation - 0.25% with immediate effect and 3% by 2022

3. Preferential feed-in tariff to be announced by CERC

4. Designated Nodal Agency to purchase power NTPC Vidyut Vyapar Nigam Ltd (NVVNL)

5. Energy Purchase Agreement (EPA) for 25 years to match the life of project Apart from National Solar Mission, other erstwhile policies & acts enacted by the Government of India viz. Electricity Act 2003, National Electricity Policy 2005, National Tariff Policy 2006, Integrated Energy Policy by Planning Commission & Rural Electrification policy highlighted the promotion & need of renewable energy as whole in the Country, resulting in SERCs intercession with preferential feed-in tariff, generation based incentive, mandatory renewable purchase obligation, open access, evacuation arrangement by distribution utility
etc., which ensures that the solar sector is here to remain for a long run.

As it is envisaged an immediate capacity addition of 1000 MW in 2010-2013 period and also NTPC (NVVNL) is designated to purchase power and sell it to concerned state utility with a solar purchase obligation, there is an immediate market to cater. As the above policies and National solar mission mandates Distribution utilities to obligate 0.25% of their total energy with solar energy the demand is set to rise in a country with a total energy demand of about 20,000 MW, which assures a long term market / demand for solar power.


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