The global energy crisis is driving renewable installations worldwide. In fact, the International Energy Agency (IEA) has predicted that the global cumulative solar PV capacity would triple by 2028, surpassing natural gas by 2026 and coal by 2027. Emerging solar technologies, such as distributed solar PV and rooftop solar (RTS) are also set for rapid growth due to higher retail electricity prices and growing policy support to help consumers save on their energy bills.
As the nation grows, industrialisation and prosperity improve, thereby impacting per capita energy consumption. At some point, for industrialised countries, energy consumption per capita levels off, while GDP (gross domestic product) may continue to move upwards. Energy intensity grows as investments in the development of energy sector shifts to energy efficiency improvements.
Photovoltaic panels | Photo Credit: Getty Images/iStock
Innovative incentives
India’s rooftop solar industry is set for remarkable growth, driven by some innovative initiatives. The CPSU (Central Public Sector Undertaking) Scheme, run by the Ministry of New and Renewable Energy, provides funding to bridge the cost gap between imported and domestically produced solar components. The PM-KUSUM (Pradhan Mantri Kisan Urja Suraksha Evam Utthan Mahabhiyan) Scheme, helps farmers install solar panels for irrigation. Other grid-connected rooftop solar programmes, which comprise, Central Financial Assistance (CFA) and Viability Gap Funding (VGF) component, aim to provide financial assistance.
The Central Government is aiming for 38 GW of rooftop solar capacity by March 2026 under Phase-II of the Grid-Connected Rooftop Solar Programme, with 4 GW from residential and 34 GW from commercial and industrial sectors. To bolster the sector and promote domestic manufacturing, the programme will mandate the use of domestically manufactured solar cells and modules, incentivising DISCOMs (Distribution Company or Utility) to expand solar energy adoption.
Resultantly, the residential segment, which lagged in the past, is now on the cusp of expansion. January 2024 witnessed a boost to the residential rooftop segment. With plans to add ₹750 billion of investment, the government is inching towards their goal of lighting up 10 million households by providing up to 300 units of free electricity every month.
Some distinct advantages that can be attributed to RTS include:
1. Decentralised energy generation
Rooftop solar, both connected to the grid or off-grid, is also an important way of decentralising energy. Out of the given target of 100GW, the installed capacity had already reached ~12.92 GW by June 2024, and by 2026 a total of 40GW is to be added under the rooftop-based solar system.
2. Supporting urban development
The implementation of solar rooftops into urban housing is also aligned with the United Nations’ global sustainable development goal. As per CRISIL, 15-17 GW of projects are expected to be commissioned under the open access utility segment over the next five years through 2030, led by the go-green initiatives/sustainability targets.
3. The utility scale segment
Commercial and Industrial (C&I) users consume ~51% of the electricity generated in India, but only a small percentage of their energy procurement comes from renewable energy sources. C&I users have emerged as an important standalone business segment in recent years in the renewable energy market, indicating their huge untapped potential. Although the present market size is small, specialised developers catering to C&I consumers have come up with innovative business models and competitive prices. Solar power is preferred over other renewable energy sources by C&I consumers due to its ease of implementation, versatility, and negligible operating costs. Moreover, solar power prices have declined significantly over the past few years, making it more affordable for C&I consumers The segment already accounts for 70-80% of the country’s rooftop solar installations and is making headway in the utility-scale solar space as well through open access and group captive routes.
There are many advantages of the synergy between rooftop solar systems and India’s real estate industry. RTS systems can accelerate India’s journey towards a greener future, while also improving the general quality of life. Essentially, the integration of renewable energy into the urban landscape aims to foster greater energy independence and efficiency, and more importantly, lead to better lives for people on the planet.
The writer is Chairman and Managing Director, Vikram Solar Limited.
Published - January 17, 2025 04:47 pm IST
