As energy consumption in the country keeps rising at an unprecedented rate, leveraging conventional and renewable sources of energy has become crucial for meeting demands sustainably. While players in the energy sector will still be dependent on optimising conventional sources of energy for years to come, there has also been a renewed focus on escalating the production of renewable energies, especially solar power, the key contributor to India’s sustainable energy goals.
India is currently the third-largest in total renewable power capacity addition and the third largest market for solar photovoltaic (PV) capacity. To further promote the clean and green transition in the energy sector, the government has been actively introducing several schemes like Jawaharlal Nehru National Solar Mission, rooftop scheme, solar park scheme, etc. Of late, the government has unveiled a plan to add 250 GW of renewable energy in the next five years. This initiative is expected to play a significant role in achieving the ambitious target of 500 GW of clean energy installation by 2030.
On similar lines, the government has been taking several facilitating initiatives to encourage and promote the domestic manufacturing setup in India. The government has levied a basic customs duty of 40 per cent on the import of solar modules, which is a major encouragement for indigenous manufacturing. The imposition of a high Basic Customs Duty (BCD) on imports has also put the domestic players in the country on a level playing ground with their international counterparts. Also, the initiatives regarding the Approved List of Module Manufacturers (ALMM) are a major support for domestic manufacturers.
Amid this progressive environment, some of the notable developments and trends the Indian solar industry is experiencing nowadays are as follows:
Acceptance by households as well as businesses
The adoption of solar energy by homes and businesses is one of the most important trends in the solar power sector. People are becoming more aware of the advantages of solar energy, including lower energy costs, less carbon impact, and more energy independence. Solar panels are now more affordable for homes and businesses thanks to a considerable decline in their cost.
Growth of utility-scale solar projects
Another trend in the solar power industry is the growth of utility-scale solar projects. Utility-scale solar projects are large-scale solar power plants that generate and supply electricity to the grid. These projects have become more popular because of their cost-effectiveness and ability to generate electricity on a large scale. In addition, utility-scale solar projects have also made a substantial contribution to lowering greenhouse gas emissions and have grown to be a significant component of the world’s energy mix.
The solar power industry has experienced significant technological advances, making solar power more efficient and cost-effective. For instance, the development of high-efficiency solar panels, which can convert more sunlight into electricity, has increased the overall efficiency of solar power systems. Additionally, the development of energy storage systems, such as batteries, has enabled solar power systems to store excess energy generated during the day and use it during low sunlight.
During Union Budget 2023-24, the Finance Minister has announced a budgetary allocation of ₹10,222 crore to the Ministry of New and Renewable Energy (MNRE), which is a 45 per cent hike from the Rs 7,033 crore expected to be spent this fiscal year. More investment in the sector will help the country decrease the share of fossil fuels and increase the share of renewable energy. Addressing the concerns effectively, the government has earmarked ₹35,000 crores for “priority capital investment”. Furthermore, the government has recently approved the allocation of around ₹19,500 crore for photovoltaic (PV) modules under the production-linked incentive (PLI) scheme. The initiative is projected to save around ₹1.37 trillion in imports; thereby further encouraging domestic production and making India self-reliant.
Emergence of new business models
The solar power industry has seen the emergence of new business models, like community solar and solar leasing. Community solar allows multiple households or businesses to share the benefits of a solar power system, reducing the initial cost and making it accessible to those who cannot install a system on their property. Solar leasing enables households or businesses to lease solar panels rather than purchase them outright, reducing the initial cost and providing more flexibility.
In conclusion, the growing demand for renewable energy and the declining cost of solar technology have spurred substantial changes and trends in the solar power industry in recent years. As costs continue to decline and governments increase their efforts to address climate change, the solar power sector is anticipated to expand overall in the future. Further, India is eyeing to become a $5 trillion economy by 2024-25 and for the steady economic growth of the country, a renewed focus on renewable energy is imperative, along with constant support to domestic industry players.
(Gautam Mohanka is Managing Director, Gautam Solar, a solar manufacturer)
Disclaimer: The views expressed in this article are those of the author and do not necessarily reflect those of the organisation