Author – Tim Smith
The development of solar power was more popular in established nations over the last few decades. However, since 2010, India has begun to invest heavily in solar energy thanks to the high prevalence of sunny days, which average around 300 days per year, as well as the rising demand for power among its densely populated urban areas. Earlier, solar energy in India made up less than 1% of the total energy demand, and since 2010, its usage has increased rapidly with the full support of the Indian government.
Solar Power Developments in India
In January 2010, India launched the Jawaharlal Nehru National Solar Mission (JNNSM) with an aim to produce solar power on a large scale and reduce the dependence on fossil fuel consumption. Over the last four years, the country managed to lower the price of solar power with the help of international investments, as well as by bundling solar power with thermal power and via a reverse bidding mechanism, which lowered the price of solar power manufacturing components. By December 2013, the cost of solar power in India was reduced to just $0.12 per kWh for Solar Photovoltaic (SPV) and $0.21 per kWh for Concentrated Solar Power (CSP), which is one of the lowest prices for grid-connected, solar power in the world.
Further, the rapid development in solar energy is expected to reduce carbon dioxide emissions per GDP by 20 to 25% by 2020 as compared to 2005 levels. As of today, 51 solar radiation resource assessment stations have been built, and data from these stations is collected to observe the availability of solar energy and to create a Solar Atlas. Furthermore, the Indian government grants a 70% subsidy to create solar power plants among the North-East states and a 30% subsidy for the rest of India. After a substantial power crisis, the government of Tamil Nadu also has implemented a policy that requires a minimum of 6% solar energy production for both residential as well as industrial buildings.
The push to implement solar power is not limited to residential and industrial buildings alone. In 2009, India introduced a $19 billion plan to make it mandatory to utilize solar power for all government buildings, hospitals, and hotels. Considering the rapid emergence of India’s middle class, this push to create sustainable energy is not only desirable, but also a necessity.
Although there have been great strides in the development of solar power as a viable alternative energy, India must overcome the following three challenges to increase its solar power developments.
1. Increase Commercial Funding
In the past three years, most commercial banks have avoided lending money for the development of solar energy projects in India. In order to increase such developments, the country must find ways to attract funds from both commercial banks and private financing institutions. According to the World Bank, it is highly unlikely to fully develop solar power as a viable alternative energy without these funds.
2. Develop Publicly Funded Infrastructure
Solar power requires large infrastructure such as solar parks. If the government provides this critical infrastructure, it reduces the cost of developing new solar power projects by private companies. For example, Gujarat has been at the forefront of solar power developments in the country by establishing India’s first solar park. The country needs to provide more of such infrastructure in order to increase production.
3. Increase Manufacturing Capabilities
India’s domestic SPV manufacturers lack industry standards, technological advances, while the domestic CSP manufacturers lack raw materials and the access to low-cost funding. In order to become a world competitor in solar power, the country must find a way to enhance its manufacturing capabilities, such as by lowering the cost of producing CSP components.
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