Business Features Smart Grid Required for India’s Solar Plan

Business Features Smart Grid Required for India’s Solar Plan
The government of India is planning to tap the most talked about solar rooftop segment potential (estimated at 92.7GW) in a big way, adding at least 1000MW capacity by 2017. This will be done by integrating a central subsidy plan under phase 2 of National Solar Mission with initiatives being taken at the state level. In reality, India’s power success story is hindered by limited, inefficient (technically and operationally) and poorly managed grid infrastructure.

100,000 villages in India are not connected to grid and 400 million people don’t have access to reliable electricity. Those having access to electricity, face frequent power cuts and low power quality in their daily lives. On the commercial side, a number of industrial associations from Faridabad to Chennai, are ailing due to the irregular power supply, which is affecting businesses.

According to the Ministry of power, currently transmission and distribution losses in India are among the highest in the world with an average at about 30.14% and including non-technical losses such as theft, the average stands at 50%. Due to the rising power deficit year over year, India faces the biggest blackout ever. The Solar Rooftop Plan seems to be a plausible solution, which may largely improve power accessibility, overcome transmission and distribution losses problem, and shrink the demand and supply gap.

KPMG forecasts that rooftop solar capacity to be 4000 MW by 2017 and rooftop power will see parity much earlier by 2014 because of rapidly falling module prices and the rise in the cost of conventional power due to fuel shortages.

The role of the smart meter

In India smart metering technology plays a very important role for grid interactive solar rooftops. Interval metering for the FiT arrangement is quite popular, although another option for net metering is being assessed. In net metering, the smart meter communicates in a two-way fashion by registering the power taken from the grid and power fed into the grid and finally giving the net balance of power use. Net metering is essentially supported by upfront capital subsidy (feeding excess power fed into grid is purchased at conventional power prices) or through generation based incentive.

Commercial and industrial consumers, who already pay high commercial tariffs, face problems in their business operations due to power shortages and currently meet their shortage using costly power from backup diesel generators. Hence, solar rooftop power used primarily for captive consumption with the GBI incentive, renewable energy certificates or capital subsidy on equipment will be viable investments. On the residential side, however, payback time can be a disincentive. As per financial analysis done by Hari Manoharan, a consultant with RESolve Energy Consultants, for residential rooftops based on GBI scheme in Tamil Nadu, payback of Rs. 56,000 over 16 years will be observed based on various assumptions. To make solar on residential rooftops more appealing, financial incentives must be much more attractive.

Technical issues to be addressed

The main technical issues to be addressed for off-grid systems will be correct sizing by the installer and proper installation by the local work force in off-grid areas. Also, there needs to be proper standardization for indigenous equipment such as the battery and inverters used in systems.

“Smart metering for solar system integration with grid will take a lot of time to be accepted since people see solar power as a solution for frequent power cuts in India” says Giridaran Srinivasan, Project Engineer, RESolve Energy Consultants. He adds that unstable grids across various states in India (where power failures are frequent) don’t accept decentralised renewable energy power and make net metering impossible during power cuts as grid tie inverters disconnect immediately when a grid failure occurs.

During power cuts, the owners can only use solar power by using off grid changeover switch or hybrid inverters (expensive hence used for large rooftops), although they are forced to consume all the power themselves, which is not always feasible, hence it is always good to have a battery backup for evening and night power requirements, which will also be helpful during blackouts and emergencies.

Regulation required

All of the segments under discussion for solar rooftops rely significantly on diesel generators for meeting their power needs during power cuts in India. The government needs to consider making regulations for prohibiting the use of diesel generators. Consumers will then look at solar as only suitable alternative (with no noise and air pollution).

India is on the way to tap the most potential segment in solar sector as recognized by solar experts. Various stakeholders must work upon for making the solar rooftops technically robust for the Indian grid. The policies launched at state and central level need to be fine-tuned to make the investments viable along with necessary regulations, which will expedite the adoption of this cleaner source of power and put more power into the hands of the Indian consumer.