India has a total installed large-scale solar capacity of 9,018
MW and a solar pipeline of 14,030 MW as of December 2016, with the top 10 states
accounting for approximately 90 percent of all solar installations and
pipeline. These states including, Tamil Nadu, Rajasthan, Gujarat, Andhra
Pradesh, Telangana, Madhya Pradesh, Punjab, Karnataka, Maharashtra, and Uttar
Pradesh hold the key to India’s solar
Tamil Nadu leads all other Indian states with 1,577 MW in-operations. In order to fulfil the state Renewable Purchase Obligation (RPO), the Tamil Nadu Generation and Distribution Company (TANGEDCO) recently auctioned 500 MW solar. The state has close to 485 MW of solar under various stages of development.
position was recently usurped by Tamil Nadu as installation activity in the
state has slowed. The state has 1,324 MW of solar in-operation with a project
pipeline of ~1,206 MW and could reclaim the top spot.
Considering Gujarat has large tracts of land ideal for
large-scale grid-connected solar projects and hasn’t faced evacuation and transmission issues, the solar sector in the state has been stagnant
with ~1,101 MW in-operation and 300 MW under development. Gujarat is a power
surplus state and has met its RPO obligations and is not in a hurry to ramp up
its solar installations.
Andhra Pradesh is the state with the most solar parks. Activity
in solar sector has picked up in the state with the completion of Kurnool solar
park. At present, Andhra Pradesh has solar projects aggregating 1,009 MW
in-operation and 1,494 MW under development.
Telangana has come a long way with its solar policies and programs
since its inception as a state. These programs have helped the state leapfrog
others to claim the fifth spot with 1,006 MW in-operation and 2,418 MW under
Madhya Pradesh has transformed itself from a power deficient
state to a power surplus state. Rapid implementation of policies and programs
has led to a growing solar sector. Currently, the state has 861 MW in-operation
and 722 MW under various stages of development. The infrastructure at the Rewa
solar park is nearly complete; once tenders are issued, solar is expected to pick
The largely agricultural state of Punjab has shown progress in
terms of fulfilling its power demand. Punjab is ranked seventh with projects
in-operation aggregating 569 MW. The state has a project pipeline of ~453 MW.
Karnataka has the largest solar project pipeline of ~3,376
MW. The state is facing solar park issues relating to evacuation and
transmission which could delay projects. The state is ranked eighth with
projects in-operation aggregating ~511 MW.
Maharashtra, the most industrialized state in India, is
ranked ninth in terms of solar energy production. Projects aggregating ~384 MW
are in-operation. The state has a project pipeline of 957 MW.
Uttar Pradesh is a surprise addition, after power purchase
agreements (PPAs) in Jharkhand for 1.1
GW were not signed. The development of solar in Uttar Pradesh has been slow;
the state has in-operation projects aggregating 241 MW and a project pipeline
of 696 MW.
Developers told Mercom that in Tamil Nadu and Rajasthan, they
are wary that curtailment might come back to haunt the sector. The distribution
companies (DISCOMs) can be reluctant to purchase solar power due to cost higher
than conventional energy. Tamil Nadu has yet to join the Ujwal DISCOM Assurance
Yojana (UDAY) program which aims at the financial turnaround of DISCOMs. Until then,
developers will be concerned due to TANGEDCO’s history of payment delays.
In Andhra Pradesh, transmission losses are its gravest issue
and few DISCOMs are reluctant to buy solar beyond their RPO. In Punjab, DISCOMs
do not want to buy expensive solar power to provide subsidized power to
farmers. Transmission losses are also an issue in Punjab, furthering developer
Telangana is mired with transmission and grid-connectivity
problems. The state has a huge project pipeline, but, developers are concerned
about power evacuation once all projects are commissioned. The state also
suffers from land availability and grid-connectivity issues.
Madhya Pradesh also suffers from transmission and grid
issues. Developers in the state have faced curtailment in some cases. The state
has also witnessed payment delays.
Developers were disheartened by the slow progress of solar
parks in Karnataka. The DISCOMs in Karnataka are in bad financial shape and some
are reluctant to sign PPAs and buy renewable power due to higher power purchase
costs. In Maharshtra, developers have witnessed the shut-down
of conventional thermal projects making them skeptical about investing in
large-scale grid-connected projects in the state.
Uttar Pradesh faces grid-connectivity issues, transmission
problems, aggregate transmission and commercial (AT&C) losses as the
infrastructure is outdated and non-existent in some areas. Even solar parks in
the state are lacking grid infrastructure, according to developers. Developers
face problems in land-acquisition in solar park in Uttar Pradesh.
Solar projects are capital intensive and “a lack of financing infrastructure in
the country is impeding desired growth in the sector,” said a developer. The developers want the Ministry of New
and Renewable Energy (MNRE) to be more involved when issues between developers
and state nodal agencies come up.
Done to Address Challenges?
In Andhra Pradesh, the transmission network will be on-grid
by February 2017. The Transmission Corporation of Andhra Pradesh (APTRANSCO) is
currently setting up the infrastructure, commented an official at New and
Renewable Energy Development Corporation of Andhra Pradesh (NREDCAP).
In Rajasthan, curtailment took place earlier this year due
to required system parameters. The PPAs have been delayed in the state. Earlier,
the state used to sign PPAs at preferential tariffs; the program ended in March
of 2016. “We are trying to fast-track
the competitive bidding process and solve issues between DISCOMs and
developers,” said an official at
Rajasthan Renewable Energy Corporation (RRECL). The green energy
transmission corridor, once developed, will boost the willingness of DISCOMs to
sign PPAs, as they can supply to other states and will have more buyers, added
the RRECL official.
The Maharashtra State Power Generation Company (MAHAGENCO)
power projects were shut-down as the DISCOMs were able to buy cheaper
electricity from National Thermal Power Corporation (NTPC) and private players.
To meet the state’s RPO, renewables - especially
solar - are being given a big push by the state and “there will be no curtailment from solar,” commented an official at Maharashtra
Energy Development Agency. Maharashtra has also joined the UDAY program and the
benefits will allow the DISCOMs to sign new PPAs.
The TANGEDCO is tendering another 500 MW. To boost the
transmission and evacuation infrastructure in the state, TANGEDCO has begun
construction of substations. Currently, four substations are nearing completion
and are expected to be completed by June 2017. Due to transmission issues, the
state has curtailed solar in the past; “but,
not so any more, we are well on track,” commented
an official at TANGEDCO.
In Madhya Pradesh, the evacuation and grid-connectivity
issues are on the verge of being resolved, commented an official at Madhya
Pradesh Urja Vikas Nigam (MPUVNL). “None of
the state DISCOMs received notification from higher authorities to connect transmission
and grid lines. As of now, all details are being distributed to zonal and
sub-zonal offices and through interdepartmental deliberations all hurdles will
be overcome, added the official at MPUVNL.
In Punjab, we have already set up canal
bank and canal top projects as these take land availability out of the
equation. Through implementation of innovative technology and scaling up of the
transmission infrastructure, Punjab will remain a sunny state, commented an
official at Punjab Energy Development Agency (PEDA).
A Solar Energy Corporation of India (SECI) official said, financing
will become easy as development banks and funds from foreign countries are keen
to invest in India’s solar
In Telangana, grid is being upgraded and “the state will be able to evacuate
all power generated in the future.” The
state nodal agency has put an impetus on transmission infrastructure as a lot
of projects will be commissioned in the coming years; “the state is gearing up for an industrial boom,” commented an official at Telangana
New and Renewable Energy Development Corporation.
complement growth in the solar sector the MNRE has facilitated easy finance
initiated pilot projects for Research & Development, and, launched the solar
parks program,” said
an official at the MNRE.
The MNRE official also added that the trade in Renewable
Energy Certificates (RECs) has gone up; DISCOMs look at it as a means of
fulfilling their RPO at cheap rates. There are 19 states and six union
territories that do not produce the required amount of renewable energy. Through
RECs they can easily achieve their RPO. “This
REC trade is a bonus for developers.” This
will also help address curtailment because this will allow states producing
surplus to sell power to others through RECs.
Officials at state nodal agencies in Uttar Pradesh and
Karnataka chose not to comment for this article.