Review of Draft Delhi Solar Policy 2022

Review of the Draft Delhi Solar Policy 2022

The Delhi Solar Policy 2016 set the foundation for solar adoption in the National Capital Territory (NCT) of Delhi. The policy enabled a deployment of over 230 MW of rooftop solar within Delhi and close to 960 megawatts of utility scale solar till date which meets 9% of Delhi’s existing annual electricity demand. However, roof top solar adoption in the state has been challenging as consumers face capital and space constraints as well as procedural hurdles.

The vision of Delhi Solar Policy 2022 is to make solar energy accessible and affordable for all consumers in Delhi by creating targeted incentives and promoting innovative models for solar adoption, and at the same time creation of green jobs in the NCT of Delhi. Meeting the commitments under Delhi Solar Policy 2022 shall ensure that, for the first time in Delhi’s history, Delhi’s installed solar capacity shall be greater than i t s installed thermal generation capacity.

Target Capacity:

The policy will be operational for a period of three years from the date of notification. The policy envisages achieving 6000 MW of installed solar capacity which shall include 750 MW of rooftop solar within the State and 5250 MW of utility scale solar from outside the State. The policy aims to meet 25% of the annual electricity demand of Delhi through solar energy.

Driving Solar Adoption:

The rooftop solar consumers in Delhi have faced a lot of challenges due to space constraints, limited awareness and policy complications. The draft policy addresses these challenges with provisions for all consumer categories namely residential, government, industrial and commercial. For consumers facing space constraints the policy recommends Group Net Metering (GNM) and Community Solar models. Group net Metering: Under the Group Net Metering model consumers with multiple buildings and service connections, facing constrained roof space in one property can benefit from any excess solar energy generated on any other property, provided these connections are in the same DISCOM territory. Community Solar: Under Community Solar Model consumers who do not have a suitable roof for installing a solar system (e.g. residential consumers who live in apartments, consumers with small or shaded rooftops) can become a beneficial owners of a part of a larger solar system through the facility of ‘Community Solar’. The energy produced by a collectively owned solar system will be fed into the grid through an energy meter and the exported energy as recorded by that meter will be pro-rata credited in the electricity bill of each participating consumer on the basis of ownership share. Peer to Peer Trading: For consumers planning to go solar

or have already installed solar system, the policy provides an opportunity by allowing them to sell their excess electricity generation from their rooftops in real time via a P2P energy trading platform. The platform will serve as an online marketplace and will enable the buying and selling of rooftop solar PV energy between two or more grid connected parties in the same DISCOM area.

Models for Consumers with Capital Constraints:

In order to overcome the limitations of the RESCO model, the draft policy for the first time has introduced Hybrid RESCO model to ensure large-scale adoption of solar systems by consumers facing capital constraints.

The hybrid model aims to combine the net-metering agreement between the consumer and DISCOM with a PPA agreement between a RESCO developer and the DISCOM. Under this model, the RESCO developer gets paid directly by the DISCOM via the PPA. The DISCOM, in turn, bills the consumer for solar power consumed at the PPA rate, as part of a single unified bill for energy consumed. The PPA tariffs for hybrid RESCO shall be discovered through a competitive bid process, and shall be approved by DERC.

The hybrid RESCO model is available in addition to the conventional RESCO model.

Economic Incentives for Consumers:

In order to promote adoption of rooftop solar, the policy extends the capital subsidy provided by MNRE of 40% for residential systems up to 3 kW and 20% for residential systems above 3 kW and up to 10kW and Capital subsidy by MNRE of 20% for group housing societies and residential welfare associations with systems up to 500kW. In addition to extending the MNRE Subsidy the policy provides additional benefits of generation-based incentives, net metering, roll -over of excess energy units exported, after net metering, into subsequent billing cycles for up to 12 months, additional income through endof-year net metering credits to all the consumers. Recognizing the need for residential consumers to have continued access to their roofs, GNCTD will provide a subsidy for raised mounting structures at the rate of Rs 2,000 per kW upto a maximum of Rs. 10,000 per consumer. Raised structures which have a minimum ground clearance of greater than 6 feet will qualify for this subsidy. The subsidy will be passed through their first electricity bill post commissioning of the RTS system.

Streamlined Procedures and Access to Information:

In order to streamline the procedures and access to information GNCTD will create a new state solar portal which will act as a single window for consumers willing to adopt solar. The portal will provide information on the end-to-end process of installing solar panels. All new net metering applications across all DISCOMs in Delhi will be made through the new portal. Consumers interested in adopting solar via the CAPEX model (where consumer pays for RTS system upfront) can use the state solar portal as a single window for the deployment of RTS systems by technically qualified developers who will be registered on the portal.

In addition to the host of benefits as mentioned above, the policy also mandates existing government buildings and all new residential, commercial, government to install RTS system. The policy also encourages deployment of solar on agriculture land via different models, encourages energy storage and provides exemptions from taxes and duties on generation from RTS for self consumption or supplied to the grid.

The Policy also encourages creation of a secondary market for components of rooftop solar PV system to benefit the solar ecosystem in Delhi. The Policy also endeavours to create an ecosystem for recycling components of solar PV system at the end of their useful life to prevent negative environmental externalities.

Out of State Solar Procurement

The policy empowers GNCTD to work with DISCOMS and other stakeholders such as SECI to ensure timely planning and execution of utility scale solar generation projects outside the NCT of Delhi so as to meet the increasing energy needs of Delhi through solar energy instead of long-term PPAs based on conventional fossil fuel energy.

Delhi Solar Cell

With an aim to facilitate, coordinate, and monitor day to day implementation of the solar energy policy in Delhi, the policy will establish a dedicated ‘Solar Cell’ within the Energy Efficiency and Renewable Energy Management framework.

The Delhi Solar Cell will lead in launching the Solar Energy Policy to the public; undertake the process for allotment of solar power capacities under various schemes of State and Central Government and Facilitate development of solar projects.

Editors take on the Delhi Solar Policy 2022

Overall we find the policy to be very encouraging and innovative. The draft policy has addressed many of the challenges and ground difficulties faced by consumer in adoption of rooftop solar. The peerto-peer trading and out of state procurement of solar is a path breaking approach that the Delhi government has taken. Going forward we see many states incorporating some of the features of the policy in their states 

OUTCOMES OF THE CLEARANCE OF THE AMENDED ENERGY CONSERVATION ACT 2022

In a remarkable historic move, the amended Energy Conservation Act 2022 has been passed by the Upper House of the Parliament – Rajya Sabha as the country continues to aggressively progress towards enabling strong climate action.

The EC Act 2022 will help the

India’s transition into a low carbon economy, meeting the development goals without burdening the atmosphere.

thE EnErGy consErVAtion Act

The Government of India first enacted the Energy Conservation Act in 2001 with an aim to redeem the country’s potentials for energy saving and conservation which has the capability to create an equivalent capacity of a minimum of 25000 MW.

The Act provides the legal framework, institutional arrangement and a regulatory mechanism at the Central and State level for the efficient use of energy and its conservation. Under this Act, the Bureau of Energy Efficiency (BEE) was established in March 2002 for the implementation of policies and programmes with the primary objective of reducing the energy intensity in the Indian economy through energy conservation activities.

The amendment to this Act that has now been cleared by the Upper House warrants a firm thrust on the improvement of energy efficiency while generating new capacities. It will aim for further lowering the energy intensity of our economy. The amends will also boost the adoption of clean technologies in various sectors of economy with a strong focus on bio energy and the promotion of clean energy sources like green hydrogen as an alternate to the existing fossil fuels used by industries currently. This will also drive increased adoption of green technologies like green building and other green advancements.

The proposed amendments will also facilitate the development of carbon market in India with its regulation on the minimum consumption of energy which will in turn help in the reduction of fossil fuel based energy consumption and carbon emission into the atmosphere. The additional incentives in the form of carbon credits against deployment of clean technologies will result in the proliferation of the carbon credit industry with more players, leading to increased climate actions. Some of the strategic developments that the Act will enable include: 1. Empower India to achieve its nDC targets: Even though the percapita emissions in the country are substantially low, India continues to be the third largest GHG (greenhouse gases) emitter in the world. Given that the Act focuses on con-

structive measures for emission reduction, it will help ensure an enhanced conducive platform for the development of strategic interventions for combatting climate change. As stringent measures are adopted, companies in India will increasingly adopt carbon reduction strategies, enabling the country to progress faster towards achieving its NDC goals. 2. Development of a strong national ETS in India: The amended EC Act 2022 will India to increasingly strive towards its net-zero commitment of 2070 with the development of a robust domestic ETS which will further enable the implementation of NDCs in a timely manner. It will also facilitate the development of India’s carbon market that will in turn enable the country to transition into a low carbon economy. The current trading schemes in India – Energy Saving Certificates (ESCerts) and Renewable Energy Certificates (RECs) will be merged into one single commodity that will be called Carbon Credits Certificate (CCC) and will operate under Cap & Trade system under the National ETS. With the implementation of the National ETS, the domestic carbon credits market will enable the development higher quality sources of carbon credits, benefitting both buyers and sellers and ultimately, supporting progress toward a lowcarbon future. In conjunction with the International Carbon Markets, India’s domestic market can play a key role in reducing global greenhouse gas emissions and enabling the larger goal for rehabilitating the entire planet. 3. India’s carbon market poised for growth: India is well poised to reap the benefits of global carbon market by leveraging its decarbonizations into credible offsets generations, which will help in enhancing the country’s share of international green finance. (i) Provisioning of the Carbon Trading Scheme under the EC Act 2022. All past non-carbon derivatives - REC and ESCert (PAT) will be merged in the proposed Carbon Trading scheme, and will be converted into fungible ‘Carbon Credit Certificate (CCC)’

(ii) A new ‘Registered Entity’ – National Carbon Registry, under Central Government or a Agency authorized by Central Government, been proposed – for registering new projects with maintained MVR protocols in line with international registry systems at UN / VCM (iii) ‘Designated Consumers’ under PAT and any other consumers as being considered appropriate will be part of the scheme – Obligated entity, will be allowed to sell & purchase of CCC (iv) Any other entity (Non-obligated entity) can participate in the scheme as Purchaser (v) National Carbon Registry under BEE [at present] / Carbon Regulatory Commission [in future], will be formulated and linked to Centralized Accounting and Reporting Platform (CARP) of Article 6 Supervisory body of UNFCCC. It will have provisioned to record all ITMOs, 6.4ERs, and VCM Projects activities and also host / with parallel linkages with Apex Committee for Implementation of Paris Agreement (AIPA) acting as Host Country Approvals (HCA) / Country Approval (Corresponding Adjustment) for all project including VCMs (optional). (vi) The operational modalities should be defined keeping in real time transaction and interface IoT technology of the CARP of UNFCCC (vii) Quality Check and OMV procedure should be standardized in line with international practice for universal acceptance 4. India’s Voluntary Carbon Market will witness a revolution: With the National ETS, India’s voluntary market will witness a surge in growth, which will be further enhanced as COP27 has substantially provisioned for Non-party (corporate) led initiatives to take the center stage of global decarbonizations. The renewed focus towards controlling GHG emissions and moving towards carbon neutrality, with specific milestone / targets is expected to encourage an increased private sector participation in combating climate change. These commitments of India Inc towards carbon neutrality would drive the demand for voluntary carbon credits in India in the years to come. The annual demand for voluntary carbon credit in India is expected to touch 500+ million units by 2030. Within the carbon credit market, the voluntary credits have relatively more importance amongst others for multiple reasons including the fact that voluntary credits enable direct private financing for mitigation projects enabling them to takeoff and scale faster. These projects in turn enable the rehabilitation of the planet through biodiversity restoration, nature protection and pollution prevention, that helps build a safer environment for improved quality of life and also boosts the economy with job creation and income generation. 5. India Inc will increasingly adopt climate action measures: Currently most companies working on climate change have been majorly voluntary in nature and has been a result of either stakeholder or ESG pressure or a purely voluntary step to reduce their carbon footprint / emission in a bid to contribute to larger climate action goals. Indian companies are pursuing these goals currently through either one of three modes - carbon neutrality, Renewable (RE 100) and Science Based Targets (SBT). With the development of a well- structured market, India Inc companies will be increasingly sensitized on climate change and will adopt greater strategies to reduce their emissions, contribution to the larger country goals. 6. Phasing down coal: An incentivized mechanism for the greater

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adoption of renewable energy alternatives will enable India to make greater progress for a massive transformation of its energy systems, especially with the new ETA (by US) mechanism been mobilized to provide financial supports to emerging economies like India, through Voluntary carbon market, which is futuristic and also enables strong compliances for achieving global climate change goals. While coal may continue to be mainstay in India’s power sector, and expected to contribute 50% of the power supply (in energy terms) even during the mid of the century, the country will now be able to aggressively stride to a future that ensures an increasingly efficient use of coal for the reduction of GHG emissions. These reforms will together enable India to not only maintain its rapid expansion of renewable energy to provide clean, low-cost power to its people but would also significantly contribute to the world offset targets that can help achieve the aggressive target of capping global warming to within 1.5 degrees Celsius.

rEcoMMEndAtions for A roBust nAtionAL Ets

Govt. can implement some important measures to establish a transparent and vibrant carbon market, which will help provide indexing facility that can be leveraged for green / carbon finance instruments, facilitating India’s carbon neutral growth path and help in attaining its NDC goal. 1. Respective line ministries, which may include MOEFCC, MoP, MoF, Ministry of Commerce and Industry, et al, to effectively form the national policy for formation of National carbon market, making it effective beyond energy production and usages sectors, e.g. forestry, agriculture, animal husbandry etc. 2. Regulation to be brought in on urgent basis to formulate the rules for operation of such carbon market. The market should be effectively sink with National Carbon Registry 3. Effective level playing field to support private sector participation in origination of carbon emission reductions (projects) and country endorsement to participate in International Voluntary Carbon trading, bringing the requisite FDIs in India 4. In recent future, with the advent of operational modalities under Article 6 Supervisory Body of UNFCCC and it’s administered International Carbon Registry, the Indian National Carbon Registry should effectively be linked on real-time basis with International Carbon Registry [Centralized Accounting and Reporting Platform (CARP) of UNFCCC] 

Year 2023, A crucial Milestone in India’s Energy Transition Journey

With an oil price shock threatening to derail economies globally, the focus has shifted to renewable energy with over USD 25 billion or Rs 2 lakh crore investment planned in India for using sunlight, water and air to produce energy. Oil and gas prices shooting through the roof in 2022 in the aftermath of Russia’s war in Ukraine sent governments in import-dependent nations like India scrambling for options.

Not just imports but a shift to renewables is also seen as a way to cut carbon footprint and meet net-zero targets. And so the government in 2022 aggressively pushed for the adoption of electric vehicles, the production of green hydrogen, manufacturing of solar equipment and energy storage in pursuit of its ambitious 500 GW renewable capacity target by 2030.

India would have to add at least 25GW of renewable energy capacity per annum for eight years continuously to achieve the 500 GW target by 2030.

At present, India has around 173GW of non-fossil fuel based clean energy capacity which includes about 62GW of solar, 42GW of wind energy, 10GW of biomass power, about five GW of small hydro, 47 GW of large hydro and seven GW of nuclear power capacity.

Union power and new & renewable energy minister R K Singh stated that the investment in the renewable energy sector could be around USD 25 billion in 2023.

Elaborating further he said, “We have to achieve a 500 GW target (of clean energy by 2030). Currently, we have a capacity of 173 GW (including large hydro and nuclear power). Capacity under construction is around 80 GW. It takes it to 250 GW. So we have to do another 200 GW by 2030.” He explained further that India needs to add about 25 GW of renewable energy capacity per annum for the next eight years, which would require an investment of Rs 1,25,000 crore or USD 15 billion to 16 billion factoring in Rs 5 crore requirement per MW of capacity addition.

Singh further said: “We are also doing (solar) manufacturing, which will also attract investment. Currently, a capacity worth Rs 8,780 crore is under construction. It includes polysilicon and module. We are bringing the PLI (Production Linked Incentive) scheme worth Rs 19,500 crore, under which around 40GW capacity will be developed. We are also doing offshore wind of 4GW, which will also fetch billions of dollars.” The government is also focussing on green hydrogen with its National Mission on Green Hydrogen. The bids are expected for the manufacturing of electrolysers next year. That would also bring investment in the clean energy sector.

In a separate communication, Solar Power Developer Association (SPDA) has suggested, “Green ammonia and green hydrogen production should be included under infrastructure sector definition, then, investment in these sectors also can be made through FVCI (Foreign Venture Capital Investor) route. This will give more flexibility to foreign investors and attract investment.” In 2022, the government provided an additional allocation of Rs 19,500 crore to the production-linked incentive (PLI) scheme ‘National Programme on High-Efficiency Solar PV Modules’. The bids are already issued this year and would be allocated in 2023.

In 2021, the government introduced the PLI with an outlay of Rs 4,500 crore to support and promote the manufacturing of highefficiency solar photovoltaic (PV) modules.

These include the upstage vertical components like cells, wafers, ingots and polysilicon. The initiative is expected to reduce import dependence in the solar PV sector.

Gyanesh Chaudhary, Vice Chairman and Managing Director, Vikram Solar said, “Investment in India’s renewable energy sector grew more than 125 per cent YoY (Year on Year) to touch a record USD 14.5 billion in FY22. India has already crossed 11 GW capacity installation in the first 9 months of the year (2022-23).” He listed some of the challenges including continued solar import (80-90 per cent still imported, worth USD 3.2 billion in FY22) and expensive raw materials (50 per cent price rise in domestic panels).

He stated that the hike in shipping costs adds to module and overall project cost.

Besides, Indian rupee falling against USD will lead to exchange rate variations between bidding and finalisation of projects, he added.

He also pointed toward the lack of flexible financing solutions and lack of tax exemptions and subsidy availability for R&D (in renewable energy) “Although the challenges are there, the growth story presents a compelling argument for domestic manufacturers like Vikram Solar to focus on innovation and capacity expansion,” he added.

The government is also focussing on harnessing the potential of setting up large hydropower projects in the country. Large hydro has already been given renewable energy status like small hydro which has a capacity of up to 25MW.

Earlier this month, the government waived off ISTS (Inter-State Transmission System) or wheeling charges on the transmission of electricity generated from new hydro power projects for 18 years from the date of commissioning.

Hydro power projects, being clean, green and sustainable will be of paramount importance in India’s clean energy transition journey. They are also essential for the integration of solar and wind power, which are intermittent in nature.

In acknowledgment of the inherent qualities of hydro power, the government of India declared hydro power projects as a renewable source of power in March 2019. However, waiver of interstate transmission charges provided to solar and wind projects had not been extended to hydro power projects.

In order to remove this discrepancy and to provide a level-playing field to hydro projects, the government has now decided to extend the waiver of ISTS charges on the transmission of power from new hydropower projects, for which construction work is awarded and PPA (power purchase agreement) is signed on or before June 30, 2025.

The government has also planned an investment of over USD 30 billion or Rs 2.44 lakh crore for creating a robust transmission system commensurate with its target of achieving 500 GW of clean energy by 2030.

A high-level committee prepared a detailed plan titled ‘Transmission System for Integration of over 500 GW RE Capacity by 2030’ in consultation with states and other stakeholders.

The plan is a major step towards achieving the goal of integrating 500 GW of non-fossil fuel-based capacity by 2030 by providing a broad plan of the required transmission system for having 537 GW of Renewable Energy capacity by 2030.

The planned additional transmission systems required for having 500 GW of non-fossil fuel include 8,120 ckm (circuit kilometer) of high voltage direct current transmission corridors (+800 kV and +350 kV), 25,960 ckm of 765 kV ac lines, 15,758 ckm of 400 kV lines and 1,052 ckm of 220 kV cable at an estimated cost of Rs 2.44 lakh crore 

Announcing India Smart Utility Week 2023

India is spearheading an ambitious mission on energy transition and is the only major economies that exceeded the targets under the Paris Agreement by end of 2020. India has now set a new target of 500 GW of renewable energy by 2030; and working on innovative policies and programs for holistic transformation to decarbonize the energy, transport, manufacturing and other sectors.

Since inception in 2011, India

Smart Grid Forum (ISGF) has been spearheading the movement towards digitalization of utilities in India. Highly disruptive black swan events like Covid-19 presented never before opportunities for innovation and transformation with profound implications in the long term. In the aftermath of Covid-19, digital platforms have become the coveted assets for utilities in their business continuity and resiliency. Government of India has launched a new program that mandates smart meters for all the 250 million+ electricity customers in the country. This is going to create data driven smart utilities which will open up new business opportunities for organizations providing tools and services to host and manage the humungous amounts of data utilities are expected to generate in the near future. Utilities in India have embarked on the digitalization drive and embracing emerging technologies such as Artificial Intelligence (AI), Machine Learning (ML), Robotics, Blockchain etc. ISGF has been organising its flagship annual event, India Smart Utility Week (ISUW) since 2015 and it is considered as one of the top five international events on Smart Grids, Electric Mobility and Smart Cities. All the previous editions of ISUW (initially known as India Smart Grid Week – ISGW) were huge success that attracted the attention and participation of the whose-who amongst topnotch thinkers and utility leaders from around the globe. Technology Companies, Regulators, Policy Makers, Government Officials and Senior Officials from Electricity, Water and Gas Utilities from 50+ countries participated every year in the past editions of ISUW. Due to COVID-19, ISUW 2021 and ISUW 2022 were conducted on a 3D virtual platform. ISUW 2021 was attended by over 2700 delegates and addressed by 457 Speakers from 49 Countries. ISUW 2022 was attended by over 2744 delegates and addressed by 396 Speakers from 61 Countries.

9TH EDITIOn OF InDIA SMART uTIlITy wEEk (ISuw 2023) FROM 28 FEB – 04 MARCH 2023 In nEw DElHI

The 9th edition ISUW 2023 is scheduled from 28 Feb – 04 March 2023 in New Delhi, India as an International Conference and Exhibition on Smart Energy and Smart Mobility. ISUW 2023 will include plenaries, interactive workshops, keynotes, technical sessions, technical paper presentations, tutorials and technical tours. Bi-lateral Smart Grid workshop with EU, USA, Germany and Sweden are also being planned. Seventh edition of ISGF Innovation Awards will be organised as part of ISUW 2023 on 03 March 2023. For Partnership, Exhibition and Participation queries, please write to us at isuw@isuw.in. For more details ISuw 2023, kindly visit www.isuw.in. The India Smart Grid Forum (ISGF) is a Think-Tank of global repute on Smart Energy, Electric Mobility and Smart Cities. ISGF, established as a Public Private Partnership initiative of Government of India in 2011, is spearheading the mission to accelerate electric grid modernization and energy transition in India. ISGF is registered as a Not for Profit Society under Indian Societies Act and have its registered office at CBIP Building, Malcha Marg, Chanakyapuri, New Delhi 110021 