In an interview Santosh Kamath, Partner - Infrastructure and Government Services, KPMG in India, says that solar will grow substantially.
So far the constraint has been the higher cost of producing power, Santosh Kamath, Partner - Infrastructure and Government Services, KPMG in India, informs R Srinivasan.
What will be the impact of the new government on solar segment across India. Also specifically in Gujarat since it has sanctioned over 960 MW at a cost of Rs 9.89/kWh for the first 12 years and Rs 7/kWh for subsequent 13 years.
We expect the new government to give a strong impetus to solar and renewables. The favourable economics and the inclination towards this source of energy as we have seen in the past in Gujarat, are reasons for this expectation.
MNRE provides 70% subsidy on installation cost of a solar PV power plant in NE states. Pros and cons of such subsidies.
It would be better to move towards a regime of replacing subsidies by financing as that can create a sustainable model. Programmes that encourage lenders and rural financiers to come forward are needed. These could include capacity building programmes for rural financiers, partial risk guarantee or insurance schemes for certain types of risks and possibly interest rate
Customs duty on solar panels has been reduced and excise duty on PV panels has been exempted which may reduce the cost of a roof-top solar panel installation by 15–20%. Where are we in view of 20 GW by 2020?
We are well on the way to achieving and even exceeding the targets. The biggest driver will be economics.
Assuming the efficiency of PV modules were as low as 10%, this would still be a thousand times greater than the energy demand. Then what factors are proving to be a constraint?
So far the constraint has been the higher cost of producing power. Going forward, this will ease and solar will grow substantially.
To what extent has the REC initiative worked out? If it hasn’t, then what factors were behind it and what would you suggest?
The scheme will be effective only when Renewable Purchase Obligations (RPOs) are enforced. That has been the issue so far.
Projects currently planned include 3,000 Orissa villages, lit with solar power by 2014. To what extent have rural electrification targets across India been met. What measures would you suggest?
Some regulatory measures such as a framework for integrating off-grid into the grid when the grid reaches the villages is needed. This will mitigate the risk of these getting stranded. Further, financing models need to be developed and encouraged by the government.
Bangalore has the largest deployment of roof-top solar water heaters in India. It is also the first city to put in place incentives on electricity bills for those using roof-top systems. Pune too has made installation of such heaters mandatory. By when can we anticipate such a movement across India?
This depends on state government policy. Solar water heaters are an easy way to reduce electricity consumption in many parts of India and should be encouraged in full measure.
The Sai Baba Sansthan Trust in Maharashtra (world’s largest solar steam system) has an annual savings of 100,000 kg of cooking gas. Could this be the way forward for shrines in India?
Yes. Solar-based steam generation and applications based on this have very good potential e.g. steam for industrial applications. This needs development of reliable products and good quality vendors.
Tamil Nadu plans to increase the installed solar capacity from 20 MW to over 3,000 MW by 2015. What would ensure its success?
In the past, there have been issues with how programmes have been conducted in some states. There needs to be a time-bound manner in which the process in conducted. Further, payment security concerns need to be addressed.
Will solar will form the backbone of the economy by 2050?
Solar certainly has great potential for India. It could transform our economy and open up new avenues for economic growth.