A lodging for the sun

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When the Managing Director of Nagpur Metro Brijesh Dixit began planning for rooftop solar solutions, he wanted the panels to be installed in such a way that two-thirds of the total power requirement of the metro would be met from solar. Today, as the first phase of the ₹8,680 crore metro is being built, a blueprint for 14 MW of solar panels is being developed, which would be laid on the rooftops, boundary walls and viaducts of the project. More than ₹100 crore will soon be spent for developing the solar power potential of the metro. A sustained push for the rooftop solar programme by the Centre has created a strong demand from industries and companies that have commercial properties. The power industry estimates that about 900 MW of rooftop capacity has already been created and it is expected to double every year. Since October 2015, over 300 MW of capacity has already been added in the country. A 300 MW coal-fired power plant takes over five years to build and requires ₹1,500 crore of capital. Experts believe that rooftop solar has led to the creation of producer-consumers, who not only produce power for their own consumption during the day but also consume lesser power from the grid. Vivek Gangulay, Finance Director of Nine Rivers Capital, believes that if the Ministry of New and Renewable Energy (MNRE) manages to install one lakh megawatt of solar power, then about 40,000 MW of rooftop solar power will get generated by producer-consumers by 2022. These producer-consumers, who use their office, industry and residential buildings to produce power could also seriously jeopardise the earnings of State utilities, he said. Gangulay, a veteran of the renewable sector, pointed out that producer-consumers are mostly industrial and commercial firms, which procure about 50 to 60 per cent of available power and pay tariff of ₹ 4-9 per unit. The tariff paid by them effectively subsidises sub-optimal tariff consumers such as agriculture as well as power thefts and commercial losses of State distribution utilities. “If producer-consumers consume less power, especially during peak hours, then softening of demand from this segment will significantly impact the financial health of the utilities,” says Gangulay. Manish Gupta, Director, Crisil Ratings, feels that viability of roof top solar sector is relatively higher for commercial and industrial segments vis-à-vis residential. While the investments in the sector are expected to rise, its viability will depend on the extent of support from the government. The MNRE, under the grid connected rooftop and small solar plant programme, has already scaled up the budget from ₹600 crore to ₹5,000 crore, with the implementation period stretched to 2019-20. CleanMax Solar, a rooftop solar solution provider, has found a new way to quicken the pace of execution. It offers an ‘opex’ solution in which the company installs the rooftop solar plant at its own expense. The building owner then pays only for the solar power actually generated at a predetermined price lower than the cost of grid power. Since the company that owns the building does not have to invest in capital for the solar plant, decisions can be taken faster and at the local level. “For the company management, it is an ‘opex’ call and not a ‘capex’ call. Board level clearances are not required,” CFO Nikunj Ghodawat points out.

Source: Business Line

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