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Shining bright (Hindu)

India can do much more to increase solar power capacity and meet its renewables target

The clearance from the Cabinet Committee on Economic Affairs for a plan to double the capacity of solar power installed in dedicated solar parks to 40 gigawatts by 2020, with partial government fiscal assistance, is in line with the goal of creating a base of 100 gigawatts by 2022. Expansion of solar power capacity is among the more efficient means to meet the commitment to keep carbon emissions in check under the Paris Agreement on climate change, and it can provide the multiplier effect of creating additional employment, with overall economic dividends. As the International Renewable Energy Agency notes in its report titled REthinking Energy 2017: Accelerating the global energy transformation, globally, jobs in solar energy have witnessed the fastest growth since 2011 among various renewable energy sectors. Asia has harnessed the potential the most, providing 60% of all renewable energy employment, while China enjoys the bulk of this with a thriving solar photovoltaic and thermal manufacturing industry, besides installations. Apart from measures to scale up generating capacity, India should take a close look at competitive manufacturing of the full chain of photovoltaics and open training facilities to produce the human resources the industry will need in the years ahead. Renewables and new energy storage technologies are on course to overshadow traditional fossil fuel-based sources of power as the costs decline.
Low-cost financing channels hold the key to quick augmentation of solar generating capacity. The trend in some emerging economies, including India, has been a reduction in public financing of renewable energy projects over the last five years. This has implications for equity in the long run, and electricity regulators should fix tariffs taking into account the reduction in the levelised cost of electricity (the average break-even price over a project’s lifetime). Yet, recourse to other funding options, including regulated debt instruments such as green bonds, would be necessary to achieve early, ambitious targets. Without realistic purchase prices, utilities could resort to curtailment of renewable power sources on non-technical considerations, affecting investments. Tamil Nadu, a solar leader in the country, resorted to curtailments last year, a phenomenon that has perhaps muted industry interest in its recent 500 MW tender. The funding mix for renewables, therefore, should give climate financing an important role. At the Paris UN Climate Change Conference, developed countries pledged to raise $100 billion a year by 2020 for mitigation, and more in later years, a promise that needs to be vigorously pursued. Besides promoting phase two of the solar parks plan, and powering public facilities such as railway stations and stadia using solar power, the Centre should put in place arrangements that make it easier for every citizen and small business to adopt rooftop solar. This is crucial to achieving the overall goal of 100 GW from this plentiful source of energy by 2022, and to raise the share of renewables in the total energy mix to 40 per cent in the next decade.
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