India marches ahead to renewable energy goals

Recently announced ‘Pradhan Mantri Suryoday Yojana’ sparks optimism amid high expectations from the upcoming budget.

India is rising as a formidable global renewable energy player, securing a remarkable position in production and generating 40 percent of its electricity from non-fossil fuels. With substantial financial backing, the country is committed to transitioning from coal reliance to embracing solar, wind, hydropower, nuclear and biomass. The coherent policies, supportive administrations, and an investor-friendly environment boost its bid for global leadership in sustainable energy.

Moving further ahead with the ambitious target, the Prime Minister of India recently unveiled ‘Pradhan Mantri Suryoday Yojana’, a scheme aiming to install rooftop solar panels on one crore homes. This ambitious initiative is part of India’s broader solar mission, initially targeting 40 gigawatts of solar power, with only 11 gigawatts currently installed in rooftop systems. The significance of this move lies in leveraging the untapped potential of rooftop solar installations, particularly in urban areas. Experts in the renewable energy sector view this as a pivotal step for two main reasons. At first, rooftop solar utilises existing building spaces, making it especially vital for urban dwellers with limited land availability. Secondly, it contributes to decentralised power generation, directly supplying electricity to households, offices, and industrial premises, reducing transmission and distribution losses.

While the government’s intentions are clear, industry experts express the need for effective implementation and overcoming historical operational bottlenecks. They emphasise the importance of addressing issues related to consumer awareness, transparency in the installation process, and the efficient functioning of Discoms.

Industry perspective on Pradhan Mantri Suryoday Yojana

Industry experts commend the Pradhan Mantri Suryoday Yojana, recognising its potential to revolutionise the renewable energy sector. The announcement has sparked optimism among stakeholders, emphasising the government’s commitment to sustainable development. However, experts highlight key areas demanding attention for seamless implementation.

At first, the solar power infrastructure requires substantial investments in research and development to enhance efficiency and reduce costs. Industry leaders stress the importance of incentivising innovation to make solar energy more accessible and economically viable. And secondly, a robust regulatory framework is imperative to address land acquisition and grid integration challenges. Experts underscore the need for streamlined approval processes and clear guidelines to navigate bureaucratic hurdles. Furthermore, the industry calls for skill development programmes to nurture a skilled workforce capable of handling solar projects.

Shirish Garud from TERI emphasises the significance of the rooftop solar scheme in meeting energy targets and stimulating domestic manufacturing. He says that the announcement regarding the solar mission, with a target of 1 cr households adopting rooftop solar systems, marks a crucial step in the broader solar initiative. Initially targeting 40 gigawatts, only 11 gigawatts are installed in rooftop systems, making the announcement significant. He further says, “The focus on rooftop installations is vital for two main reasons: efficient land use within urban areas and direct electricity generation at the point of consumption. Rooftop systems reduce transmission and distribution losses, as electricity is generated where it is needed in households, offices, and industrial premises.”

Shirish explains that this scheme aligns with the government’s intention to address energy losses and promote cleaner energy consumption. The recent increase in subsidies for residential solar rooftop systems, coupled with a clear market development strategy, indicates a proactive stance from the government. The large-scale adoption will benefit consumers and stimulate the domestic manufacturing sector, fostering growth in the production of solar modules. “Overall, this initiative will significantly boost the solar market, aligning with sustainability goals and supporting domestic manufacturing endeavours,” he adds.

Vineet Tyagi from Rayzon Solar shares that the recent government announcement of prioritising solar installations in 1 crore households presents a significant opportunity for domestic manufacturers. While subsidies exist, their impact is debatable, as grid parity is already achieved at around ₹5 per unit. He says, “The government should emphasise awareness, transparency, and efficiency in the solar sector. Operational bottlenecks, lack of awareness, and unclear processes for discoms and bankers hinder progress. Customers should be made aware of solar benefits, enhancing system transparency, improving Discoms officials’ efficiency, and facilitating low-cost funding.” He further says that to boost the sector, addressing these operational roadblocks truly is crucial. Industry demands align with a subsidy-free approach, advocating for autonomous sector growth and consumer education. “Clearing implementation hurdles is paramount for achieving the desired push in demand for rooftop solar, allowing the industry to thrive independently,” he adds.

Gaurav Upadhyay from IEEFA highlights the importance of subsidies for the residential sector, particularly in rural and lower-income households. He raises concerns about the ambiguity surrounding installation procedures, net metering, and bill adjustments, stressing the need for consumer education. He says, “There should be a comprehensive approach, and the government should not only announce schemes but also clarify their benefits and implementation details. Quality control, monitoring infrastructure, and efficient services are significant when investing in solar assets, even with subsidies.” Gaurav suggests creating specialised agencies to bridge the gap between renewable energy providers, discoms, and consumers. He points out that existing nodal agencies, often discoms, may lack sufficient reach and trust, hindering the success of renewable energy schemes. “There should be a stronger government focus on consumer education, awareness, and the establishment of dedicated agencies to facilitate the adoption of renewable energy solutions,” he adds.

Santosh Kamath from Alvarez and Marsal opines that the success of ‘Pradhanmantri Suryoday Yojna’ hinges on comprehensive government support and distribution companies’ active involvement (Discoms). He says, “The government should spearhead the initiative by incentivising Discoms to champion the cause. Given their strategic position in accessing consumers, Discoms can aggregate demand and facilitate solar installations.” He further says that the financial incentives for Discoms, coupled with administrative support, are crucial to secure their commitment.

“Balancing consumer awareness, Discom support, and vigilant monitoring creates a synergistic effect, increasing the likelihood of programme success. This creates a harmonious collaboration between the government, Discoms, and consumers, fortified by incentives and administrative backing, which can propel the solar initiative forward,” he adds.

Expectations from the upcoming budget

There are high expectations for substantial measures to accelerate the renewable energy sector from the upcoming budget. Stakeholders are hopeful for increased allocations and incentives that will foster the growth of sustainable energy sources. The government is anticipated to prioritise investments in solar, wind, and other renewable technologies to enhance capacity and promote cleaner energy production.

Expectations include robust financial support for research and development, enabling technological advancements and innovations in renewable energy. Incentives such as tax breaks and subsidies are eagerly awaited to encourage private sector participation and attract foreign investments, fostering a more conducive environment for green energy projects. Additionally, the budget is expected to address regulatory bottlenecks and streamline approval processes to expedite the implementation of renewable projects. Policy for promoting grid integration, energy storage solutions, and smart grid technologies is anticipated. Furthermore, measures to enhance skill development in the renewable energy sector are likely to be emphasised, ensuring a skilled workforce to meet the growing demands of the industry.

Vineet Tyagi from Rayzon Solar stresses the need for investments in the transmission and distribution sectors. He says, “Supporting manufacturers, especially in the Small and Medium Enterprises (SME) segment, is crucial for meeting the growing demand. Vertical integration in the solar manufacturing process is essential for reducing import dependency.” Santosh Kamath from Alvarez and Marsal anticipates significant progress in the green hydrogen sector, emphasising the need for concrete programmes and allocated funds to support the transition. He says, “Focusing on rooftop solar and storage is paramount. A financial package for rooftop solar could accelerate adoption, and dedicated programmes for energy storage are essential to fortify renewable energy initiatives. These three areas, green hydrogen, rooftop solar, and energy storage, demand targeted programmes and clear objectives to maximise impact. “Despite previous strides, the government should articulate specific goals and funding commitments to drive sustainable advancements in these critical sectors,” he adds. 

Shirish Garud from TERI emphasises the need for increased investments in transmission lines. Furthermore, he anticipates additional funds for research and development in hydrogen-related technologies, supporting the government’s ‘Atmanirbhar Bharat’ scheme. Gaurav Upadhyay from IEEFA stresses a need to address gaps in the renewable energy sector. He says, “There is a need to align policies with industry needs and create a conducive ecosystem for sustainable growth.”

United vision for RE Future

India stands at the precipice of a transformative era in renewable energy, a sentiment echoed by experts who agree that the nation is poised for significant growth in this sector. Anchored by a robust demand trajectory, judicious government policies, and strategic investments, India is charting a course to emerge as a global leader in renewable energy. Central to this optimistic outlook is the belief that renewable energy will play a pivotal role in India’s journey towards a five trillion-dollar economy. Industry leaders emphasise the indispensable nature of renewable energy in achieving this ambitious milestone. The country’s trajectory towards economic prowess is seen as intricately linked to its commitment to green and sustainable practices.

Insights from the leaders underline the need for a comprehensive approach that encompasses not only ambitious policy reforms but also efficient implementation and strategic investments. The success of initiatives like the Pradhan Mantri Yojana Surya, designed to promote solar energy, is viewed not merely in terms of achieving numerical targets but as a cornerstone in fostering a sustainable and resilient renewable energy ecosystem. This ecosystem, in turn, is envisioned as the driving force propelling India towards a cleaner and more energy-efficient future.

QUOTES:

Shirish S Garud, Consultant, and Senior Fellow- TERI

“The focus on rooftop installations is vital for two main reasons: efficient land use within urban areas and direct electricity generation at the point of consumption.”

Vineet Tyagi, Head of North Sales- Rayzon Solar 

“Clearing implementation hurdles is paramount for achieving the desired push in demand for rooftop solar, allowing the industry to thrive independently.”

Gaurav Upadhyay, Energy Finance Specialist, India Sustainable Finance- IEEFA

Quality control, monitoring infrastructure, and efficient services are significant when investing in solar assets, even with subsidies.”

Santosh Kamath, Managing Director- Alvarez and Marsal

“The government should spearhead the initiative by incentivising Discoms to champion the cause. Given their strategic position in accessing consumers, Discoms can aggregate demand and facilitate solar installations.”