Dear All,
Its sunny side up yet again.
India’s Ministry of New and Renewable Energy (MNRE) has issued a draft
solar policy for Phase II (2013- 2017) of the country’s Jawaharlal Nehru National
Solar Mission (JNNSM), outlining its strategy to install 10GW by 2017
through mostly utility-scale projects.
The objective of the MNRE’s Solar Mission is to create through rapid scale-up of capacity and technological innovation, to
drive down costs towards grid parity. The ministry believes solar power
could achieve grid parity and become cost competitive with coal in India
by 2018 due to the decrease in module prices.
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| MNRE draft |
MNRE envisages that of this 10GW target (see table above), 4GW would be
developed under the JNNSM central scheme and 6GW under various
state-specific schemes. During Phase II, MNRE expects that around 20,000
villages will benefit from these schemes for off-grid electricity
generation projects, to hit its target of 1,000MW of roof-top solar
The schemes include 'bundling', which involves combining solar power
with traditional sources of energy like coal, which can be sold to
utilities at a cheaper rate than offered by solar power alone.
There is also a Generation Based Incentive (GBI) which increases
deployment of rooftop PV systems as well as small power plants. The MNRE
is required to offer utilities a set price valid for 12 years. However,
the government is concerned that with falling module prices, the GBI
could become an expensive incentive scheme. Project sizes under Phase II
are expected to be in the range of 500kWp to 2.5MWp.
The majority of project allocations will be completed under the
Viability Gap Funding (VGF) offered to private investors in the form of
grants from the government. The scheme aims to ensure widespread access
to infrastructure provided through a public-private partnership
framework by subsidising the capital cost to developers by 20% and
thereby reducing the need for government involvement in solar projects.
Phase II will also include aid to solar manufacturers across the value
chain, although details were not provided in the draft policy. Financing
for manufacturers will be crucial at this time, with the Indian Solar
Manufacturers’ Association having approached the World Trade
Organisation over complaints against foreign manufacturers undercutting domestic manufacturers.
Till then take care
