India presses state to raise solar ambition

The Indian government’s eagerness for its states to pick up the solar baton was again illustrated this week with the news, revealed on buiness website DNA India, that the Union government is leaning on Maharashtra state to almost double its renewable energy target.

An online report yesterday (Thursday), quoting the state’s chief minister Davendra Fadnaris, said a Union government minister has suggested Maharashtra should raise its renewable energy generation target from the current 14.4 GW to 25 GW by 2020.

With the unnamed central government minister in question citing the state’s solar potential as the reason for such an ambitious move it raises the prospect of PV being allocated more than half of the expanded capacity target. Of the current 14.4 GW renewables target, 7 GW is expected to come from solar.

According to the DNA report, Mr Fadnaris was told the resulting power could be purchased by the state or sold on the open market.

The latest development in India follows the news market research company Mercom Capital has raised its 2015 solar prediction for the nation to more than 2 GW, thanks to a raft of PPAs signed by the Tamil Nadu Generation and Distribution Company (TANGEDCO).

Commissioning for the Tamil Nadu projects, which Mercom says will total between 400 MW and 1 GW, will happen from September to March.

SECI’s 2 GW plans

The Mercom quarterly update listed other positive developments, such as the Solar Energy Corporation of India’s (SECI) plans to develop and own 2 GW of projects, ranging in size from 250-500 MW.

The Indian Ministry of Power has proposed raising the Renewable Purchase Obligation (RPO) on power companies – dictating how much renewable energy they must generate or purchase – from the current 3 per cent to 8 per cent by 2019 and, more importantly, according to Mercom, a recent Supreme Court ruling that rejected a challenge to the RPO in Rajasthan could make enforcement easier across the nation.

With the Indian parliament’s Electricity Amendment Bill untying the monopolies enjoyed by utilities by separating power distribution and supply, and with the state-owned Reserve Bank of India adding renewable energy to its priority lending list – albeit with limits that restrict such funding to small scale projects – Mercom says solar will continue to flower in India this year.

Mercom says a planned halving of the solar rooftop subsidy from 30 to 15 per cent is unlikely to have a deleterious effect thanks to falling system prices as the government aims for 40 GW of rooftop solar by 2020.

All eyes are now on when exactly the Union government, so keen to lean on its states, will finally introduce the long-awaited second batch of projects under Phase II of the Jawaharlal Nehru National Solar Mission.