Risk of power outages as demand for electricity peaks , post pandemic : India makes more than 70% of its power from coal or thermal source. Due to surge in international coal prices, it is uneconomical to import coal India had one of largest reserves of coal However most of thermal power plants in India are near going out of stock of coal. There are issues with falling production of Coal India Ltd, a PSU that has monopoly over mining and distribution of coal Coal India’s bills for crores of rupees are unpaid by SEBs (State electricity boards) who are mired in losses The entire supply chain of electricity generation is under severe pressure as spot prices for electricity has gone over Rs 20 per unit (KW-HR) The rich in India have back up captive power, that uses Diesel generating sets . Its the poor who suffer as DISCOMs resort to load shedding (ie cut off power )
India blessed with 300 days of sun in a year: Unlike most countries in Europe, that get less than 100 days of full solar radiation, almost all parts of India get more than 300 days of full solar radiation, ie four hours or more. Thus India is blessed with abundant renewable, green, solar power India need not depend upon fossil fuels or even expensive nuclear to meet our energy demands. Due to abundant solar energy, and crash in prices of solar PVs that are made in China, cost of electricity from solar PV is now among the lowest in the world, less than Rs 3 per unit (about 4.2 USCents) Among renewable energy options, capital cost of rooftop solar are a fraction of wind/bio gas Nuclear power also does not generate carbon emissions But is is now very very expensive, as compared with solar power Nuclear power has longer gestation period as well Unlike for captive solar , for Roof top solar installation, one does not need to acquire additional land; existing roof area is used to catch solar energy, that was going any way going waste or was heating up the building or causing leakages in rainy season. Rooftop Solar(RTS) PV panel generates power during the day , to meet peak demand from industries while the resident user, will be drawing from the grid in night when power demand is low This is ideal for meeting variation in electrical energy ie peak load demands during 11 AM to 3 PM. Thus renewable electricity from solar PV can ideally meet peak load requirements while non renewable electricity from coal can meet base load requirements. As per one study, all Mumbai’s power requirements can be met from Roof top solar PV if only 10% of potential is tapped.
What is Gross metering(GM) , Net Metering (NM), Grid support charges In both GM ans NM, the solar panel is connected to grid, called as In grid. There is no need of battery back up. What is different is the accounting for power produced. Under GM(Gross metering) , the total energy generated by the solar rooftop plant is assumed to be injected into the grid without allowing the generated solar energy to be consumed directly by the consumer. Under NM, the energy generated by the solar rooftop plant is allowed for self-consumption and the excess energy is injected to the grid. Under net metering, the units consumed are set off against unit produced like a barter arrangement In other words, the producer gets set off the production @ rate of power tariffs charged. In case of high users, or commercial establishments, the rate of power tariff rate is Rs 11 per unit So under NM, the producer gets credit for electricity produced @ Rs 11 per unit . Under net metering, the excess units used by consumers are credited @ tariff rates of DISCOM, like a barter system . As against this, under gross metering, the producer gets credited , say @ Rs 3 per unit, while their usage is charged say @RS 11 for the power that is consumed . Thus Gross metering makes solar rooftop projects un viable. Under gross metering, the entire consumption will be charged at MSEDCL tariff, and value of solar energy generated by the consumer will be deducted from it @ rate of lowest PPA (power purchase agreement) Grid support charges is back door gross metering as the DISCOM charges Rs. 3 to Rs 8 to solar PV generators In other words, gives them less for power that they produce.
Why NM is better for RFS power producer : This can be understood with an example. If a consumer uses 500 units and generates 450 units. Under net metering, he will be billed for 50 units at DISCOM tariff. However, under gross metering he will be billed for all 500 units at DISCOM tariff while DISCOM will buy the 450 units generated by him at Rs 3 per unit , the average cost of renewable energy purchased by the discom.
As DISCOMs have a slab system, the bill for 500 units used will be very high, the average being around Rs 8 to 11 per unit. Against this, the average cost of non renewable energy from coal, is Rs6 per unit, while cost of renewable solar PV power is now available for less than Rs 3 per unit This means that the RTS producer will be paid by DISCOM at the rate of Rs 3 per unit for the 500 units he consumes. Under net metering, he pays for only 50 units at low rates, because the tariff for 0-100 units is low.Further the consumer will get benefit of net metering only upto 300 units per month So even if he generates more than 300 units , the extra units will be under gross metering, whereas he would have got a negative bill under net metering.
Here’s actual output of very small , 3.76 KW solar PV installed at our Kharghar residential in Sept 2017. This shows that 1 KW RTS generates only 835 units per year though most RTS vendors assume much higher output , 1200 to 1500 units per year. per 1 KW panel.
As you can observe, the output of even a small 3.76 KW RTS unit goes over 300 units, in best months( ie April, Sept, Oct, Nov) when solar radiation is high This high output will now be made redundant under new policy because for residential consumers NM is allowed only for maximum upto 300 units per month In any case, like most state DISCOMs, MSEB(Maharashtra State Electricity Board) limits the Solar Roof-top PV capacity to 80% of the sanctioned load of the consumer If the sanctioned load is 8 kW, then maximum solar that can be installed is 5.6 kWp This means that installation of RTS is feasible only for big consumers By limiting net metering only for residential users, who typically use less power, the DISCOMs have smartly ensured not much rooftop solar installations will now be commissioned The new policy of grid support charges , ranging from Rs 4 to 9 per unit, will make even small RTS commercially unviable Larger RTS installations, 10KW will also become uneconomical.
Many state governments reneging on contracts : State governments are claiming that there is abundant power so they do not need to square the consumption of RTS against power produced by Net metering. So DISCOMs are now reneging on contractual obligation of net metering. For example, Karnataka switched to gross metering recently, whereby the solar power producers will get less than Rs 3.70 per unit for power produced Maharashtra too is forcing Gross metering on all solar producers MSEDCL(Maharashtra State Electricity Distribution company Ltd) has now proposed to replace net metering by gross metering for all producers except residential ones Secondly net metering will be applicable only up to 300 units per month for residential household consumer Thus hotels, offices, societies(large consumers of electricity) who had installed rooftop solar( or who are considering rooftop solar) the payback for investment now stretches beyond 25 years see chart 2 These consumers who invested in rooftop solar PV (ie hotels, offices, colleges, hospitals or CHS) on assumption of net metering, now have to write off the entire investment UP and Telangana were the only two states who had gross metering while most other states in India have net metering. Now it is likely that all other state DISCOMs too, will force GM on all solar producers
The payback under RTS under NM( net metering (without subsidy) was less than 7 years ,This excellent payback was without availing subsidy or depreciation benefits (see chart 1)
“Net metering” is good option for high consumers of electricity As power tariffs keep increasing, the payback on investment is faster. The investment in RTS pays back @ rate of power tariffs. As the rate of power climbs up, the investment pays back earlier. As the tariffs for power are very high in India for commercial consumers (Rs 11 per unit in Maharashtra), the net metering was a great investment even with out availing subsidy See charts below Chart I
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