27 December 2017 2017 09:45 AM GMT

Rooftop PV Presents a $23 Billion Opportunity in India Over The Next 5 Years

India will need to invest $23 billion over the next five years to meet its target for 2022 of 40GW of rooftop photovoltaics, according to a new report by Bloomberg New Energy Finance (BNEF)Accelerating India’s Clean Energy Transition, published recently at the BNEF Future of Energy Summit in Shanghai, examines the trends in India’s rooftop solar, rural mini-grid, off-grid and utility-scale renewable energy segments. India’s government has set its sights on having 175GW of non-hydro renewables capacity by 2022 (made up of 60GW onshore wind, 60GW utility-scale solar, 10GW bioenergy, 5GW small hydro and 40GW rooftop solar). At present, this figure stands at just 60GW.

India is accelerating development of renewable energy projects to provide cheap, reliable and clean power to its 1.3 billion people. The country’s per-capita on-grid electricity consumption increased by 22% over the four years ending March 2017 due to increased industrial activity, higher uptake of electrical appliances by residential electricity users and the addition of new consumers to the grid.

The majority of the capacity in the 2022 target – a total of 135GW – is utility-scale (wind farms and solar parks, in particular) and does not include large hydro projects. The report estimates that India will need to invest $83 billion to build this capacity. The good news is that, because of falling capital costs per MW, that figure is $19 billion less than in BNEF’s previous estimates. New renewable energy projects will exceed fossil fuel build-out for the first time in 2017, and in the years thereafter.

But some of the most interesting activity will be in small-scale solar. Shantanu Jaiswal, head of India research at Bloomberg New Energy Finance, said: “Rooftop solar in India will grow inevitably with or without the support of power distribution utilities.”

The cost of electricity from rooftop PV has halved in the last five years due to fierce competition in the market and a drop in equipment prices. In contrast, average retail electricity rates have increased by 22% in the same period. This has made rooftop PV cheaper than commercial and industrial grid tariffs in all major states in India.

Bloomberg New Energy Finance expects residential sector PV growth to pick up rapidly post-2021. At the moment, its attractiveness is being held back by the high upfront capital expenditure that is necessary, by a shortage of financing options, and the fact that grid electricity is cheaper for residential consumers with low consumption.

“Net metering is a far more important enabler for residential small-scale solar than for business-scale projects,” said Itamar Orlandi, head of frontier markets at Bloomberg New Energy Finance.

Homeowners are usually drawing less power during the hours when their PV panels are producing, making self-consumption much harder. Solar projects also have a big and untapped potential to power irrigation pumps and reduce the use of back-up diesel generators.

Ashish Sethia, head of Asia-Pacific research at Bloomberg New Energy Finance, said: “Growth of rooftop solar presents an opportunity for the distribution companies to diversify and start their own businesses in that area rather than lose customers to other rooftop developers.”

Power distribution companies can also work with other rooftop PV companies to provide operations and maintenance services, billing, lead generation, branding and sales support, Sethia added.

Annual rooftop PV installations in India

Source: Bloomberg New Energy Finance, industry surveys, Ministry of New and Renewable Energy. Note: India’s financial year is from April to March.

India is expected to install more renewable energy than fossil fuel power generation in 2017. Commissioned renewables projects amounted to 10GW through September, compared with 8GW for coal and gas

Efforts aimed at rural electrification have led to a significant increase in access to electricity over the last three years. However, quality and reliability of electric supply by distribution companies in rural areas remains poor. Despite that, off-grid companies have not been able to match the rapid growth of utility-scale renewables and rooftop solar systems.

India has a target of installing 10,000 rural micro-grids with a cumulative capacity of 500MW by 2021. The risk of stranded commissioned assets as a result of grid extension is the biggest concern for investors. That is impeding rapid build-out of small rural grids. Five states in India have released micro-grid policies and regulations in the last two years to promote investment and installations in this sector.

Off-grid power consumers who use solar lanterns and home systems are now moving to larger devices, leading to up-sell and cross-sell of various small solar products in areas poorly serviced by grid electricity. Micro-grid companies are also encouraging the use of productive load equipment like rice hullers, air coolers and refrigerators in their areas, helping to boost the rural economy.

Bloomberg New Energy Finance (BNEF) is an industry research firm focused on helping energy professionals generate opportunities. With a team of 200 experts spread across six continents, BNEF provides independent analysis and insight, enabling decision-makers to navigate change in an evolving energy economy.

Leveraging the most sophisticated new energy data sets in the world, BNEF synthesizes proprietary data into astute narratives that frame the financial, economic and policy implications of emerging energy technologies. Bloomberg New Energy Finance is powered by Bloomberg’s global network of 19,000 employees in 176 locations, reporting 5,000 news stories a day.

June 20th 2018
Battery Boom: Wind And Solar Can Generate Half Of Worldwide Electricity By 2050

Coal is to shrink to just 11% of global electricity generation by mid-century, from 38% now, as costs shift heavily in favour of wind, solar and batteries. Wind and solar are set to surge to almost “50 by 50” – 50% of world generation by 2050 due to reductions in cost. “Cheap battery storage means that it becomes increasingly possible to finesse the delivery of electricity from wind and solar so that these technologies can help meet demand even when the wind isn’t blowing and the sun isn’t shining. The result will be renewables eating up more and more of the existing market for coal, gas and nuclear.”

June 20th 2018
Growth Of Renewables In Peru As Enel Opens Largest Wind Farm In Country

Enel is now Peru’s leading renewable energy generator with around 1.1 GW of installed capacity following the commissioning of Wayra I which, with more than 132 MW, is now Peru’s largest wind farm. Built in approximately a year and comprising 42 wind turbines of 3 MW over each, it’s expected to produce 600 GWh per year; enough to avoid the annual emission of over 285,000 tonnes of CO2 into the atmosphere. The energy generated by the wind farm is being delivered to the Peruvian transmission grid (SEIN) through the Poroma substation. The project is supported by a 20-year energy supply contract with Peru’s Ministry of Energy and Mines.

June 18th 2018
IET’s Renewable Power Generation Conference Comes To Copenhagen

The Institution of Engineering and Technology’s popular Renewable Power Generation conference will be making its first visit to Denmark this year. The conference, now in its 7th iteration, will be hosted by the Center for Electric Power and Energy at DTU, which also manages the world-class experiment platform for research and development of renewables integration – PowerLabDK. Over 180 new research papers will be presented at the conference. Attendees will be able to find out the latest ideas and thinking around wind power plant modelling and control; wave and tidal energy; renewable energy forecasting; power conversion and grid interaction; Hybrid systems combining multiple energy sources; the impact of distributed generation and use of HVDC.