India can easily go up to 100 GW in rooftop solar alone, says Gagan Vermani, founder, MYSUN, in an interview.
Says Gagan Vermani, founder, MYSUN, in conversation with R Srinivasan.
Schools, educational institutions, online marketplace Snapdeal warehouses and now ashrams are going solar. Your views on how data centers (that are huge power guzzlers and have large rooftops) could emulate IBM’s example and adopt solar.
With solar prices having dropped significantly, a majority of energy consumers across consumer categories stand to make huge savings on their energy bills by going solar. In fact, commercial energy consumers pay the highest tariff amongst all electricity consumers. Data centres can easily be called energyguzzlers. Not only do they need the power to run the high-voltage DC computers and storage systems, but they also spend a lot on air-conditioning due to the heat dissipated by this equipment. Therefore, the power cost becomes a major contributor to the overall operational cost of a data centre. Moreover, in the case of grid power, one needs to convert AC to DC to run data-centre loads. This conversion is highly inefficient, and a lot of energy is consumed in this process. Solar is ideal to cater to this need. Solar PV panels produce DC output, and they integrate with other power sources, including grid and backup power. Moreover, the sun shines brightly in most parts of India. So, adopting solar results into a highly reliable source of energy with huge savings for data centres.
The country is to install 700 MW of rooftop PV in 2016. While it sounds great on paper, kindly elaborate on challenges that the industry will encounter along the way and what you would suggest for the same.
The biggest challenge is to convince consumers to go solar as they have a lot of apprehensions. Once that is done, finding the right solar installers or developers is another challenge as there is a lack of standardisation in this segment of the solar industry. Grid interconnection issues such as delays in net-metering or other discom approvals slow down the pace of solar deployment. The availability of financing is another challenge. For solar developers, one of the biggest challenges is the contract compliance risk as they take the risk of their customers defaulting on payments. We need to put more focus on creating demand, in educating people and then making it easier and risk-free for them to buy solar. Net-metering, even though adopted by many states, is still very slow on the implementation front. That needs to be accelerated. And discoms should be made a party to solar power-purchase agreements so that the contract compliance risk can be minimised.
What factors prevent net metering from taking off in Maharashtra as in other states?
The challenges are almost uniform across states. Many states have announced Net Metering policies but the biggest challenge is bringing the discoms on board, streamlining approval processes and defining a time-frame and target MWs. Because of this, the implementation of net-metering has not been effective. Net-metering is a great concept to feed-in excess solar power generated back to the grid. An effective policy should include a concrete implementation mechanism with quantifiable short-term
and long-term targets. The objective should also be to make it hassle-free for consumers to apply for this facility, just like a simple online application.
Comment on ramifications of the recent World Trade Organisation (WTO) ruling.
The recent final ruling by WTO asking India to do away with DCR policy impacts the usage of solar modules, which constitute almost 50% of the cost of a solar system. In fact, with tier 1 module prices falling to sub-$40 cents level in global markets, it is against the interests of millions of energy consumers in India to pay a hefty price just to protect the financial interests of a few Indian module manufacturers. In a way, if this DCR policy had continued, India would not have seen solar energy prices dropping close to Rs 4/kWh. The protectionist DCR requirement was a short-sighted approach. Instead, Indian solar manufacturers should be supported by other means like cheaper electricity, financing and working capital support, tax breaks/exemptions, etc. In the long run, India should focus more on being the lowest cost producer of solar electricity so that its long-term goals of affordable and quality power for all are met.
Solar has picked up pace but distribution companies are reluctant to purchase solar in light of low power demand and cheap power availability on exchanges. MNRE is mulling a $400 million fund to protect clean energy producers from payment delays by discoms. Also your views on funding support from banks and on dumping of lower cost modules from China and Taiwan.
Yes, the power availability situation on the exchanges has improved a bit and therefore, discoms are trying to avoid buying solar power. But this is a short-sighted approach only to manage day-to-day power costs. The discoms need to take a long-term view on solar more so as the cost of solar has come down vis-a-vis coal-based power if we go by some of the recent biddings. Also, they need to go fully digital for efficient grid management so that they have the flexibility to use the cheapest power available depending on the time of the day.
The funding from banks has been good for solar when it comes to utility-scale solar power plants. However, due to contract compliance risks and small ticket sizes, banks have been a little hesitant in the rooftop solar segment. GOI has given solar priority sector lending status but in practical terms nothing much has happened there.
The issue of dumping of lower cost modules has been grossly overstated. Most of the solar industry stakeholders today understand the importance of using reliable solar panels. Almost 9 out of the 10 largest solar panel manufacturers today are controlled by Chinese companies. Buyers need to avoid getting very aggressive on their pricing targets as this compromises the quality.
Governor Brown has committed to having over 1.5 million electric vehicles (EVs) on the road in California by 2025, and the state is working to ensure that there will be sufficient EV charging infrastructure to support it. Your views on largescale deployment of EVs (adopting solar charging stations) in India and the resulting benefits.
A lot has happened on this front in the US in the last couple of years. Tesla is a great learning example for the rest of the world. India too has started its journey with EVs through cars such as Reva along with widespread promotion and usage of thousands of e-rickshaws. Purely from the impact on pollution and air-quality in India, EVs make tremendous sense. However, we need to evaluate the commercial viability of the same in India. Since storage costs are still high, it may take a few years before we will see a flood of EVs on the Indian roads. And we foresee solar-powered charging stations to be the perfect accompaniment to these greener EVs.
As a new solar venture, your views on whether the Indian rooftop segment is moving in the right direction and what lies ahead for the sector in the years to come.
Having seen the growth of solar in India, and the associated challenges too, over the last 8-9 years, we created MYSUN as a platform to drive the demand for solar among consumers and make it easier and affordable for consumers to adopt solar.
We realised that non-utility solar, even with a 40 GW target by 2022, wasn’t going anywhere. Customer demand is low and the industry is struggling to find the right business models. There is a lack of trust on solar, and people are unaware that they too can use and benefit from going solar.
Our analysts and engineers have mapped the entire country, pin-code-wise and consumer-wise, and have developed elaborate algorithms to give an unbiased and relatively easy yet accurate solar assessment to anyone living in India, whether for residential, commercial or industrial use.
Our pan-India research shows that solar makes great financial sense for a majority of consumers with monthly bills as low as Rs 2000 per month across most parts of our country. If we can cater to all this demand, even accounting for the fact that not everyone will have access to a rooftop to install solar, India can not only meet the 40 GW target but easily go up to 100 GW in rooftop solar alone.