Factors That Will Further Aid Solar Rooftop Installation In Punjab & Haryana

since the issue of the model net metering regulations in 2013, only a few states have begun actual implementation of the policy on the ground. The slow or patchy progress in the net-metering policy can be attributed primarily to issues like lack of clear policy frameworks, passive opposition from DISCOMs and insufficient awareness cum training at the local utility level.

There needs to be uniformity at the policy level to catalyze the adaptation of rooftop solar for consumers, uncertainty in regulations is slowing the pace of rooftop installation by C&I consumers. Taking cues from the Maharashtra net metering fiasco, where the DISCOM wanted to revert the net metering to gross metering, thus putting the whole rooftop market in jeopardy, it is time that the central government steps in and helps various DISCOMs create a policy environment across the country around net-metering, thus making stable and uniform laws that won’t be subject to whims and fancies of individual state distribution companies. This will help build investor confidence and attract investments in the sector.

Though it is easier said than done as it would dismantle the equilibrium created by the cross-subsidies that becomes a taboo even to talk about.

Access to Finance

Limited access to debt finance due to perceived high risks and suspicion about performance for this relatively new sector within the financial community is a deterrent to growth in solar. Banks and FIs are reluctant to lend to solar rooftop projects and borrowing costs can be as high as 12% or more when they do lend.

Due to the smaller size of the projects in the rooftop solar sector, developers do not approach banks for loans because of the proportionately higher transactional cost per unit of the project cost. Here the small retail consumer has to go through the personal loan route if incase he desires to finance his rooftop solar power plant. It would make a lot of sense if a new sub category can be placed in the existing home loans to install solar power in already constructed houses at the same interest rate, without having the need to hypothecate the whole house instead just the installed solar power system. The finance would be easier to access and the banks can do the local due vigilance on the consumer’s credit history instead of a central rating requirement.

Consumer perception of risks and performance

Even after a decade of proliferation, solar power is still perceived as a relatively new technology especially amongst the retail consumers and therefore there is a perception that it may not perform as expected over its lifetime. Also, there are trust issues as several entrepreneurs in the rooftop solar market are comparatively new with a little track record and maintenance of quality and customer service is always uncertain.

Few policy level steps that the agencies involved can take to reduce the confusion about the retail are:

� The involvement of too many agencies like MNRE, IREDA, SNA, and electricity board and electricity regulatory commission makes the development of solar PV projects difficult.

� Generation-based incentives should be offered rather than subsidy. This data can be easily available in electricity bills, this would make the financing of the plant also easier.

� The net metering procedure should be time-bound with online single window process on ground and not on papers as it is now, and the net meter should be fitted within one month from the date of application.

Even though India has the lowest capital cost per MW globally to install solar power plants and the current installation have grown exponentially in the past half-decade, yet solar only accounts for 3% of the total power consumed in the country, and about 10% of the total installed power capacity of India. This on a positive note leaves the sector accessible for growth in the coming decade.

Mr. Sushil Sarawgi, Director, Kor Energy India Pvt Ltd

Better awareness about the benefits of rooftop solar needs to be created for residential, commercial and industrial sectors by government, social and industrial bodies as well as solar industry. Good projects should be showcased to consumers and live existing projects will help them get better understanding and develop confidence in technology. Bottlenecks related to net metering approval needs to be taken care of, and the process has to be made much more consumer-friendly. Many customers are apprehensive of the problems that they might have to face to get those approval and because of this, they delay decisions for going solar. Post net metering also, customers especially in

Haryana face a lot of problems in getting adjustment of exported units in the electricity bills. This leads to bad word of mouth publicity about Net Metering benefits from the existing users of rooftop solar energy. Delay in disbursement of subsidy is one major reason why residential customers were not going for rooftop solar. Now with new policy of upfront subsidy there should be better adoption of rooftop solar energy by them. There is a subsidy for cold storages from Horticulture Board for adoption of Rooftop Solar by them up to 35 percent of project cost. As there are a good number of cold storages in both Punjab and Haryana. If this subsidy benefit is properly marketed, it will result in better adoption of rooftop solar by cold storage facilities in the states.

Mr. Brhamesh Alipuria, Director and Founder, Direct Watts SET Pvt. Ltd.

Net Metering process clarity and time bound approvals There has to be clarity within the DISCOMs (PSPCL in Punjab) (UHBVN and DHBVN in Haryana) about the Net metering process and the required documentation. The documents for submissions must be clearly defined. Approval must be time bound. There are going to be fundamentally 4 stages: 1. In principal approval required for setting up of net metering and solar connection as per regulation of the state. 2. Electrical Inspection / CEIG required once the solar plant is installed by the consumer. Defined checklists should be there on the basis of objections may be raised. 3. Meter checking and changing also known as plant commissioning as the maximum benefit of net metering can only be achieved, once the Net Meter has been replaced. 4. Net Metering Agreement often ignored and unaware, the net metering agreement is not done with the user, where the benefit of time can be challenged for the user. Many clarifications are required on validity of such agreement and benefits to the consumer.

www.solarquarter.comwww.solarquarter.com time and money. It is also confusing the consumers. The rates being discovered are only bringing the quality of the system down and are often not practical.

No Need for Awareness Programs or Subsidy

In my experience, if the government focuses only on the first step and executes it properly, the advantages of solar power along with the various industries associated with it, will automatically be promoted among the masses. Further, with the current prices, the system is affordable to most who understand the benefits of it and there is no need for subsidy. Subsidy process might be hampering the growth of solar at this time.

Financing and Tax Benefits Instead of subsidy, the government should instruct banks to develop products for solar financing like vehicles and homes. Further, the GST on solar should be reduced and Individual Tax Benefits could be provided to encourage quick adoption of solar.

CHALLENGES TO EFFECTIVE COST MANAGEMENT IN SOLAR O&M

In light of narrowing developer margins owing to falling solar power tariffs, how do you optimise costs and ensure better savings? This is one tough question for the solar power operations and maintenance (O&M) segment. In order to reduce unplanned downtime, and improve revenues through better generation, more efficient O&M practices are required.

Today, developers and plant operators are being compelled to reduce operational expenses and optimise generation to increase the dwindling profit margins. Besides, the recent imposition of safeguard duties, and goods and services tax (GST) offers little relief from the pressure already built up.

While large asset owners will continue to achieve economies of scale because most of their O&M activities are managed in-house. However, mid- and small-size asset owners will continue to face cost and profit margin pressures, leading to outsourcing of O&M activities. Manpower and module cleaning account for the largest share of O&M expenses at a solar power plant.

O&M costs can be optimised by recalibrating some specific parameters of the plant which include module cleaning that considers soiling rates, cleaning costs and manpower optimisation through centralisation and technology substitution. In view of the current scenario, it is important for cost management strategies in solar O&M to evolve with the changing times.

Let’s understand some expert views on efficient cost management practices in solar O&M below:

According to Vector Green Energy, “It is time that the industry starts approaching O&M costs from an holistic perspective and the traditional O&M setup moves towards a comprehensive Asset Management service. For any measures taken to improve

cost efficiencies, which are being realized through any optimization exercise, should be

looked at critically on the basis of its potential to minimize the risks for the asset, as well

as ability of such measures to ensure that the optimizations lasts for a significant period

of project life.”

The industry also needs to avoid the temptation to demonstrate cost efficiencies either

by ignoring regular plant health analysis in early days, or by failing to timely address the expected wear and tear, to create shareholder wealth for the project life.

www.solarquarter.comwww.solarquarter.com key challenge given the fact that solar PV modules are expected to degrade, and operating costs are expected to go up on account of wear and tear, as well as inflation.

Growth Strategies to Stay in Sync with Market Demand, While Promoting Cost Efficiency

Adopting a holistic asset management practice with focus on integration of best practices in the portfolio and standardization of O&M practices, reporting and contract KPIs will drive cost efficiencies as well as optimal portfolio performance in a rapidly scaled up portfolio. The industry also needs to graduate from regular break down / preventive maintenance to predictive maintenance, to be able to identify the areas that require advance attention to promote cost efficiencies. Continual and effective utilization of data analytics helps in identifying the areas where cost efficiencies can be brought in.