Induction of mini grid system by the state distribution utilities can provide better opportunity to solar energy sector, says Ramesh Narayanan, CEO, BYPL, in an interaction with R SrinivasanThe CERC has said that the renewable energy sector will soon be in for stricter grid laws and standards compliance regime. How will this impact the sector?Th sector has its own technical nuances. Strict grid laws and standard compliance regime could act as impediments for accelerated growth in the renewable energy sector. Considering these technicalities, it will be good for the policy makers and regulators to consider and promote mini grids by discoms for absorbing such renewable energy projects.The solar energy sector faces an acute shortage of skilled manpower. In view of the emphasis on solar in the next few years, what ought to be done?The solar energy sector, especially the ones supplying solar equipments or devices have to provide user-friendly products and features to their end-users. For instance, more technologically challenging electronic devices like phones, i-pads, computers and other FMCGs are able to penetrate the end-user markets and launch products by providing user-friendly information about product features.The solar segment could also adopt such measures to popularise solar-based devices. This technology is far less complex than the FMCG consumer durable electronic devices. Skilled manpower in this sector is essential for any manufacturing industry. As of now I believe there is enough skilled manpower for the sector, however, with the increase in demand we may need to enhance it further.Germany’s feed-in tariffs have led to that country's growth as a market leader in solar. In view of the global average, would you suggest ‘feed-in tariffs’ similar to Germany to be practiced in India?Feed-in tariffs exists in Germany and few other countries where there is higher solar penetration. They are being experimented in our country as well. Besides feed-in tariff, there are other incentives like REC certificates etc. Already 15 solar based projects have been energised on the basis of feed-in tariff in India. However, there should also be some local incentive schemes to promote solar projects – say for the rooftop project companies or utilities could be encouraged to provide inverter-based grid-connected solar panels to various end-users on a monthly rental basis. These end-users could then be offered energy banking facilities by the utilities in return for additional free energies as incentive during off-peak hours for participating in such schemes.The government could provide such incentive energies out of the unallocated quota available at their disposal for the promotion of such solar roof-top schemes. For instance, a utility could install 1 KW solar rooftop panel at a nominal monthly lease rent of say Rs 2,000 per month and offer 270 units of free electricity during the night—say between 11 pm and 5 am to make the investment viable and attractive. This could be a win-win situation for all stake holders. More such alternatives could be explored.In your view removal of accelerated depreciation benefits were good or bad for the business in the sector?Accelerated depreciation benefits were extended to wind farms. This served as a huge impetus for their development and this has catapulted India’s wind farm projects’ capacity to over 20,000 MW - one of the largest in the world. Therefore, accelerated depreciation for all renewable projects including solar could help accelerating developments.It has been witnessed that Chinese have shown strong interest for getting into Indian market in the recent past. What will be the impact of such a move since about 20-30 per cent of domestic solar equipment makers’ total capacity getting consumed in the local market?Importing solar cells and other semi-conductor devices is not a bad option. For a traditional solar wafer, the energy consumed to manufacture it exceeds energy the wafer would produce in its lifetime. Therefore, it would be a good idea to source these wafers from other countries and save on energy. However, we should ensure quality of all such solar devices.How private players investment has helped sector?As far as the power sector is concerned, the reforms initiated in 1991 have brought in huge private investments in the generation sector. This has been possible because of the changes brought in the financial, administrative and legal framework for promoting generation projects.A similar reform initiative is required for the power distribution sector as well so as to accelerate capacities in distribution sector matching the investment in generation and transmission. According to Planning Commission documents, in the past 60 years for every Re 1 spent on power generation, only 40 paisa has been spent on T&D. This mismatch needs to be corrected for the benefit of development to end-users.Experts say tariffs in the range between Rs 7.50-7.90 per unit could render these projects unviable at a time when projects get financing at current domestic rates of around 13 per cent. What is your view on this?Considering the maturity level of renewable technologies, special financial support in the form of concessional loans and other incentives are essential to attract larger investments.The CERC has said that it is considering extending the renewable energy certificates (REC) scheme to rooftop solar power plants. What is your stand on this?It would be a welcome step if CERC introduces REC scheme for rooftop solar projects as well.
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