All Blog


Solar Energy in India

Solar Energy in India

Context: The Union budget increased allocation for the Production-linked incentive (PLI) scheme for high-efficiency solar modules.

About Solar Panel and its working:

  • A solar panel is a collection of photovoltaic (PV) cells that collect sunlight and convert it into electric current.
  • When sunlight hits the semiconductor in the solar PV cell the energy from the light in the form of photons is absorbed.
  • This energy absorption results in exciting a number of electrons, which then drift freely in the cell.
  • The solar cell is specifically designed to create an electric field.
    • This electric field forces the electrons to flow in a certain direction- towards the  electrical terminals that line the cell.
  • This flow is known as an energy current, and the strength of the current is determined by how much electricity each cell can produce.
    • Once the electrons reach terminals  the current is then directed into wires making the panel a source of electrical energy.

Solar Energy potential in India:

  • From less than 10 MW in 2010, India has added significant PV capacity over the past decade, achieving over 50 GW by 2022 .
  • By 2030, India is targeting about 500 GW of renewable energy deployment, out of which ~280 GW is expected from solar PV.
    • This calls for 30 GW of solar capacity every year until 2030.
  • India’s current solar module manufacturing capacity is limited to around 15 GW per year rest is met through imports.
  • An estimated 85 per cent of this import need is met by three countries China, alongside Vietnam and Malaysia.
    • The value of solar imported since 2014 adds up to $12.93 billion, or Rs 90,000 crore.

Advantages of Solar Energy in India:

  • This is an inexhaustible source of energy and the best replacement to other non-renewable energies in India.
  • Solar energy is environment friendly, hence it is very suitable for India as it is being one of the most polluted countries of the world.
  • Solar energy can be used for variety of purposes like as heating, drying, cooking or electricity, which is suitable for the rural areas in India replacing other energy resources.
  • It can also be used in cars, planes, large power boats, satellites, calculators and many more such items, just apt for the urban population.
  • In an energy deficient country like India, where power generation is costly, solar energy is the best alternate means of power generation.
  • Solar panels can be easily installed; hence it is quite inexpensive compared to other sources of energy.
  • By 2012, a total of 4,600,000 solar lanterns and 861,654 solar-powered home lights were installed.
    • Typically replacing kerosene lamps, they can be purchased for the cost of a few months’ worth of kerosene with a small loan.
    • The Ministry of New and Renewable Energy is offering a 30- to 40-percent subsidy of the cost of lanterns, home lights and small systems.
  • Solar photovoltaic water-pumping systems are used for irrigation and drinking water.

Challenges of solar energy manufacturing in India:

  • Solar cell manufacturing needs a huge amount of capital.
    • The cost of debt in India (11%) is highest in the Asia-Pacific region, while in China it is about 5%.
  • Solar cell manufacturing is a complicated process that is technology intensive.
    • Establishing state-of-the-art manufacturing facilities needs access to technology.
    • It is unlikely that companies that have spent millions of dollars on R&D would make it easy for India to access the latest technologies easily or at a lower cost.
  • Lack of an integrated set-up and the economies of scale (despite 100 per cent FDI in the renewable energy sector) translates into higher cost of domestic production
  • Solar panel Manufacturing suffers from a huge raw material supply crunch.
    • Silicon wafer, the most expensive raw material in the panel, is not manufactured in India.
  • Solar cell technology sees upgrades every 8-10 months making manufacturing inefficient for new entrants.

Govt. of India Initiatives:

  • The govt. of India established a 19,500-crore production linked incentive (PLI) scheme on ‘national programme on high efficiency solar PV modules’, seeking to attract Rs 94,000-crore investment in the sector.
  • Modified Special Incentive Package Scheme (M-SIPS) of Ministry of Electronics & Information Technology offers a 20-25 per cent subsidy for investments in capital expenditure for setting up a manufacturing facility.
  • Atal Jyoti Yojana (AJAY): The AJAY scheme was launched in September 2016 for the installation of solar street lighting (SSL) systems in states with less than 50% of households covered with grid power (as per Census 2011).
  • PM KUSUM: The scheme aims to add solar and other renewable capacity of 30,800 MW by 2022 with total central financial support of Rs. 34,422 Crores.
  • Solar Park Scheme: The Solar Park Scheme plans to build a number of solar parks, each with a capacity of nearly 500 MW, across several states.
  • SRISTI Scheme: Sustainable rooftop implementation of Solar transfiguration of India (SRISTI) scheme to promote rooftop solar power projects in India.
  • National Solar Mission: It is a major initiative of the Government of India and State Governments to promote ecologically sustainable growth while addressing India’s energy security challenge.