How do you see the role of distributed solarin enhancing energy resilience in urban India?
Distributed solar provides an opportunity for consumers to become prosumers (producers + consumers) while allowing them to shift their electricity consumption to cleaner sources and generate clean energy. As the generation is happening closer to the demand centres, distributed solar systems offer energy independence through decentralised power generation, localised benefits, and support discoms’ financial health by reducing losses and effective demand management, thereby contributing towards energy resilience in urban cities. It can be critical in alleviating the stress on the grid during peak hours and provides backup power during outages when combined with battery storage
What are the key challenges and opportunities that urban India faces when it comes to adopting distributed solar systems?
India can leverage the opportunity provided by distributed solar systems to decarbonise its electricity demand and contribute towards net zero commitment by 2070. As per CEEW estimates, rooftop solar potential within the residential sector stands at 118 GW — enough to meet the residential sector’s annual electricity demand of 353 billion units as of 2023. However, several factors limit the adoption across consumer segments. For example, limited consumer awareness, delays in net metering approvals, limited financing options, and restrictions on minimum system size and penetration ratios at the distribution transformer level impact the adoption in the residential segment. Uncertain and inconsistent regulations across states impact the adoption in commercial and industrial segments, such as net metering limits and applicability, variation in banking charges and provisions, and implementation of green open access regulations. MSME segment also faces challenges pertaining to access to affordable finance for initial investment requirements.
How can distributed solar contribute to addressing the rising demand for energy in urban areas, especially during peak hours?
As temperatures are soaring each summer, increasing heatwaves and humidity lead to the rising need for indoor cooling and high electricity demand. IMD announced 2024 as the hottest year ever recorded, with peak demand in India touching 250 MW in May. This surge has further increased the demand for electricity from power markets at higher prices, impacting the financial health of distribution companies. Distributed solar energy can play a critical role in meeting growing demand in urban centres by generating it locally and easing pressure on the grid. Solar generation hours align with the daytime peak consumption and can contribute towards peak shaving and easing out the impact on discoms’ finances.
In your opinion, how can policymakers and regulatory bodies support the growth of distributed solar installations in cities?
Unlocking the potential of distributed solar in cities requires twofold interventions. First, there is a need to move beyond traditional business models such as CAPEX and OPEX to a more customised business model based on paying capacities, land availability, and consumption profile of the target consumer segment. Second, regulations must support the implementation of innovative business models, such as the adoption of virtual net metering and group net metering mechanisms by states. One such example is the extension of capital subsidy to systems installed under the virtual net metering mechanism by The Ministry of New and Renewable Energy (MNRE). This opens opportunities to implement the community solar business model that can expand access to solar power and its applications to underserved communities, especially for consumers with a demand of less than 1 kW.
In your opinion, how can policymakers and regulatory bodies support the growth of distributed solar installations in cities?
The future of distributed solar in India looks promising and can play a key role in building a sustainable and resilient urban energy infrastructure. Accelerating the adoption requires targeted consumer awareness campaigns coupled with innovative tools like AI-driven chatbots in local languages to enhance consumer awareness and engagement. Streamlining the regulations across states for distributed solar systems, for example, benchmarking the process across states, including the net-metering approval and testing process, load enhancement and upgradation, to accelerate deployment and ease the financial burden on consumers. Introducing financing solutions focusing on economies of scale and customised financing options for small-scale consumers. Leveraging the potential across consumer segments by rolling out innovative business models supported by enabling regulations. Finally, creating a robust vendor ecosystem through targeted capacity building and fastracking vendor rating programs to ensure access to quality vendors across states.
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