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Sun-powered success
Articles- Sep 28,24
The intermittency of solar and wind energy poses another challenge, as large volumes of renewable energy must be integrated into the grid.
The future of energy is shining brighter than ever. As the world turns its focus toward sustainable solutions, solar energy has emerged as the frontrunner in the race to redefine how we power our lives. With ever-advancing technology, visionary projects, and an unwavering commitment to a greener tomorrow, the solar revolution is not just a trend—it’s a transformative force reshaping industries and redefining possibilities, says Sanskriti Ramachandran.
The Indian solar energy market is undergoing a significant transformation, driven by both government initiatives and a global push for sustainable energy. As the demand for clean energy grows, India's solar sector is not only expanding but also innovating to meet the challenges posed by large-scale solar installations.
Growing Indian market
India's solar energy market has experienced remarkable growth, generating revenues of $10.4 billion in 2023. This is expected to witness a compound annual growth rate (CAGR) of 13.4% between 2024 and 2030, with the market projected to reach $24.9 billion by 2030. Much of this growth can be attributed to government policies and initiatives aimed at promoting solar energy adoption. Regulatory support, subsidies, and financial incentives provided by the National Solar Mission (NSM) and various state organisations have played a critical role in this expansion.
The Ministry of New and Renewable Energy (MNRE) is actively working to increase the share of renewable energy in the country's total energy mix. Numerous government schemes, such as the CPSU Scheme, Solar Park Scheme, Defense Scheme, VGF Schemes, Bundling Scheme, Grid Connected Solar Rooftop Scheme, and Canal Bank and Canal Top Schemes, are aimed at increasing solar power generation in India. These initiatives have made solar energy more accessible and attractive to businesses and individuals, fostering growth in the sector.
India benefits from its geographic location, receiving around 5,000 trillion kWh of solar energy annually, with most parts of the country receiving 4-7 kWh per square metre per day. International collaborations and foreign investments, coupled with research and development (R&D) projects, have further propelled the market. As a result, solar technology has advanced, making solar energy more cost-effective and efficient, while addressing the country's increasing energy demand.
Challenges and infrastructure development
Despite the robust growth, the Indian solar energy market faces significant challenges, particularly in terms of transmission infrastructure and energy storage. According to Bigyan Parija, Chief Operating Officer-Solar and Storage, Serentica Renewables, “One of the primary challenges is the need for the rapid expansion of transmission capacity to match the pace of renewable energy installations.” India has set an ambitious target of adding 50 GW of renewable capacity annually. However, without the corresponding expansion of transmission infrastructure, delays in evacuating power from solar projects could occur. This highlights the need for substantial investments in transmission to ensure timely grid connectivity and prevent bottlenecks.
The intermittency of solar and wind energy poses another challenge, as large volumes of renewable energy must be integrated into the grid. Parija further emphasises that "advanced energy storage solutions are crucial for maintaining a stable and reliable power supply." While batteries remain the primary option, exploring alternative storage technologies and driving innovation will be essential to enhancing the resilience of India's energy system.
In some renewable energy-rich states, new grid connectivity might not be available until 2028, pending the implementation of high-voltage direct current (HVDC) systems. This delay could slow down planned solar installations, underlining the importance of timely investments in transmission infrastructure and energy storage technologies to manage the complexities of integrating solar energy into the grid.
Government initiatives and policies
The Indian government has launched several initiatives to accelerate the adoption of solar energy. The National Solar Mission (NSM), launched in 2010, set an ambitious goal of achieving 100 GW of solar capacity by 2022. Although this target was not fully met, the NSM has been instrumental in increasing solar energy adoption in India. The project aligns with India's Nationally Determined Contributions (NDCs) to reduce the GDP's emission intensity by 45% from 2005 levels by 2030, and to derive 50% of the total installed capacity for electric power from non-fossil fuel-based energy assets.
Additionally, clients benefit from tax cuts provided by the government, which reduce installation costs and the overall expense of solar energy. This has made solar energy more economically feasible for both businesses and households, encouraging widespread adoption.
Rooftop solar installations have gained momentum, driven by government programs and financial incentives. "The implementation of rooftop solar panels is expected to generate significant demand, driven by both consumer interest and supportive government initiatives," notes Parija. The ‘Muft Bijli Yojana’ and similar programs have made rooftop solar more accessible, offering long-term financial savings and energy independence for households and businesses.
Technological advancements, particularly in energy storage, have also played a role in boosting the appeal of rooftop solar systems. As these systems become more reliable and efficient, they are expected to contribute significantly to India's renewable energy goals, particularly the 100 GW solar target by 2030.
Local manufacturing and technological advancements
India is also focusing on developing its domestic manufacturing capabilities in the solar sector. The Production-Linked Incentive (PLI) scheme, introduced by the government, aims to boost local production of solar modules and cells, thereby reducing the country’s dependence on imports. As Khushboo Doshi, Managing Director, Rajoo Engineers Ltd, notes, "The solar sector in India presents significant growth opportunities. With the government's ambitious targets, local manufacturing initiatives, technological advancements, and supportive infrastructure development, the country aims to achieve a renewable energy (RE) target of 450 GW by 2030." Solar power is expected to contribute around 280 GW to this target.
The PLI scheme has significantly benefited local manufacturers by reducing production costs and promoting quality control measures. Tanmoy Duari, CEO, AXITEC Energy India Pvt. Ltd., shares how the scheme has impacted operations, "The Production-Linked Incentive (PLI) scheme has provided substantial benefits to our operations by lowering manufacturing costs and improving quality control measures." Duari further explains that AXITEC plans to expand its production capacity from 300 MW to 600 MW by utilising more advanced machinery, which will help the company contribute more significantly to India's sustainability targets for 2030.
Technological advancements have also played a key role in the solar sector's growth. Innovations in solar modules, energy storage solutions, and solar-powered electric vehicle (EV) charging stations have helped India stay at the forefront of the global renewable energy market. Raman Bhatia, Founder and Managing Director, Servotech Power Systems Ltd., emphasises the importance of innovation, "We are developing advanced solar modules, integrating storage solutions, and leading in solar-powered EV charging stations."
Large-scale projects
Large-scale solar installations have been a driving force behind India's renewable energy capacity expansion. The Solar Photovoltaic (PV) technology segment dominates the market, accounting for around 75% of India's solar capacity in 2023. The affordability of solar modules and the wide range of applications, from water heating to electricity production, have made solar PVs the preferred choice for large-scale solar projects.
India has seen a steady increase in its installed solar capacity. As of June 2024, the country had a cumulative installed solar capacity of 87.2 GW, accounting for 19.5% of India's total installed power capacity and 44% of the total installed renewable energy capacity. Rajasthan, Gujarat, and Karnataka have led the country in terms of large-scale solar installations. Additionally, India's large-scale solar project pipeline stood at 146 GW, with another 104 GW of projects tendered and pending auction.
However, project delays due to grid connectivity and transmission infrastructure issues have significantly impacted solar capacity additions. The reimposition of the Approved List of Models and Manufacturers (ALMM) order has further contributed to project delays, particularly for open access solar projects.
Future outlook
Despite the challenges, India's solar energy market is poised for continued growth. The country aims to achieve 450 GW of installed renewable energy capacity by 2030, with solar power contributing more than 60% of this target. The Indian government's commitment to fostering local manufacturing and technological innovation, coupled with international collaborations and investments, will further drive the solar sector's development.
The rooftop solar market, in particular, offers immense potential for growth, especially among micro, small, and medium enterprises (MSMEs). As financing options improve and state-level policies become more supportive, rooftop solar adoption is expected to rise significantly in the coming years.
The future of solar energy in India looks promising, with government initiatives, technological advancements, and infrastructure investments creating a favourable environment for growth. As India continues to expand its renewable energy capacity, the solar sector will play a pivotal role in achieving the country's long-term sustainability goals.
(Source: Mercom India & PSMarketResearch)
Solar
Solar power
solar panel
solar energy
renewable energy
Bigyan Parija
Serentica Renewables
Raman Bhatia
Servotech
Tanmoy Duari
AXITEC
Khushboo Doshi
Rajoo Engineers
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