Is roof top solar option really attractive to the consumers?

Roof top Solar is one of the major initiatives under Jawaharlal Nehru National Solar Mission (JNNSM) to promote solar electricity at end use consumption level. Installation of roof top at a consumers place not only provides a green electricity but also helps him in terms of reduced black outs. Various states have taken initiatives to promote rooftop solar , however Gujarat remains a leader for rooftop by launching 5MW roof top systems in Gandhi Nagar. Gujarat government has signed power purchase agreement (PPA) with Azure Power and Sun Edison at a feed in tariff (FIT) of Rs. 11 per unit for the period of 25 years. The building owner gets an incentive of Rs. 3 per unit for the electricity generated from the roof top plant.

In a similar initiative, Karnataka has also proposed to implement roof-top systems and their local utility BESCOM plans about 10 MW rooftop projects which will be grid connected at 415v and the electricity will be purchased by BESCOM to meet its RP obligation. Similarly in Chandigarh, the government of Punjab has proposed to install rooftop systems as a part of MNRE solar city program.

In recent times roof top systems have become attractive as module prices have fallen down to as low as 0.6 USD per watt. Considering a capacity utilization factor (CUF) of 19% and interest rate of 13 %, the roof top systems are not financially attractive as the cost of generation is about Rs. 8 per unit while the grid electricity cost to a roof top owner is about Rs. 5 per unit. If the interest rate subsidy to roof-top owner at 2-5% the cost of generation can be brought down to Rs 5 per unit which makes roof top system viable to the consumers. Many roof top owners believe that rather than providing capital subsidy of 30% to roof top systems, if government provides low-interest loan at 2-5% ,the adaptability of roof top systems will improve significantly.

Posted By: Prateek Sikka


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