Issue #2: Renewable Energy

Scenario in India
Indias prime minister recently launched an international solar alliance of
over 120 countries (International Agency for Solar Technologies & Applications
(IASTA)) with the French president, Franois Hollande, at the Paris COP21
climate summit. This international event has again brought the focus to the
potential of renewable energy for the entire world, the tropical countries in
particular. It is all the more relevant to a country like India where
approximately 360 million people lack adequate access to grid-electricity and
another 20 million households receive less than four hours of electricity per day.
Why Renewable Energy?
1) Renewable energy is, well, renewable This means it has infinity of
sustainability and we will never run out of it. Other sources of energy like coal,
oil and gas are limited and will run out some day. Renewable energy can reduce
our dependence on fuels and energy from foreign governments.
2) Environmental Benefits It is clean and results in little to no greenhouse and
net carbon emissions. It will not deplete our natural resources and have
minimal, if any, negative impacts on the environment, with no waste products of
Co2 and other, more toxic take with different sources of energy.
3) Reliable Energy Source Our dependence on fossil fuels has increased
considerably in last few decades. The result is that our national security
continues to be threatened by our dependence on fossil fuels which are
vulnerable to political instabilities, trade disputes, wars, and high prices. This
impacts more than just our national energy policy. Also, solar and wind plants

are distributed over large geographical area and weather disruptions in one area
wont cut off power to an entire region.
4) Economic Benefits Renewable energy is also cheaper and more
economically sound than other sources of generated energy. It is estimated that
as a result of renewable energy manufacturing, hundreds of thousands of stable
jobs will be created. Thousands of jobs have already been created in numerous
European countries like the United Kingdom and Germany, who have adopted
measures to manufacture renewable energy. Renewable energy amenities
require a less amount of maintenance, which reduces the costs. Switching to
renewable energy sources also means that the future of our energy is returned
back to the people: to communities, families, farmers, and individuals.
5) Stable Energy Prices Switching to renewable energy sources also means
steady pricing on energy. Since the cost of renewable energy is dependent on
the invested money and not the increasing or decreasing or inflated cost of the
natural resource, governments would pay a definite price per unit rather than
the ever changing commodity prices.
What are its Disadvantages?
1) Reliability of Supply One shortcoming is that renewable energy relies
heavily upon the weather for sources of supply: rain, wind, and sunshine. In the
event of weather that doesnt produce these kinds of climate conditions
renewable energy sources lack the capacity to make energy. Since it may be
difficult the generate the necessary energy due to the unpredictable weather
patterns, we may need to reduce the amount of energy we use.
The presence of battery to store energy becomes a very expensive proposition.
2) Difficult to Generate in Large Quantity Another disadvantage of renewable
energy is that it is difficult to generate large amount of energy as those
produced by coal powered plants. This means that either we need to set up

more such facilities to match up with the growing demand or look out for ways
to reduce our energy consumption.
3) Large Capital Cost Initial investments are quite high in case of building
renewable energy plants. These plants require upfront investments to build,
have high maintenance expenses and require careful planning and
implementation.
4) Large Tracts of Land Required To meet up with the large quantities of
electricity produced by fossil fuels, large amount of solar panels and wind farms
need to be set up. For this, large tracts of land is required to produce energy
quantities competitive with fossil fuel burning.
What is the status of renewable energy in India?
Renewable energy in India comes under the purview of the Ministry of New
and Renewable Energy. India was the first country in the world to set up a
ministry of non-conventional energy resources. Indian Renewable Energy
Development Agency (IREDA), is there to promote, develop and extend
financial support for renewable energy and energy efficiency.
The government has taken the following initiatives to promote renewable
energy in India.
a) National Clean Energy Fund The Finance Bill 2010-11 has created a corpus
called National Clean Energy Fund, which will invest in entrepreneurial ventures
and research in the field of clean energy technologies. The money for this will
be garnered through a so-called clean energy cess Rs 50 on every
tonne of coal, both domestic and imported.
b) Renewable Energy Certificates (REC) REC is a market based instrument
which enables the obligated entities to meet their Renewable Purchase
Obligation (RPO). Certificates are generated on account of production of

renewable energy by RE generators. These certificates can be sold and traded

or bartered, and the owner of the REC can claim to have purchased renewable
energy.
c) Off Grid Power Program Distributed/decentralized renewable power projects
using wind energy, biomass energy, hydro power and hybrid systems are being
established in the country to meet the energy requirements of isolated
communities and areas which are not likely to be electrified in near future.
d) Green Energy Corridor India has set aside US$7.9 billion to create a
green energy corridor to facilitate the flow of renewable energy into its
grid electricity. The project will be implemented with the assistance of Germany
which has promised to provide developmental and technical assistance of 1
billion as soft credit.
1) Wind Power The development of wind power in India began in the 1990s,
and has significantly increased in the last few years. Around 1986 first wind
farms were set up in coastal areas of Maharashtra (Ratnagiri), Gujarat (Okha)
and Tamil Nadu (Tuticorin) with 55 kW Vestas wind turbines.
As of 30 Nov 2015 the installed capacity of wind power in India was 24,759 MW,
mainly spread across South, West and North regions. East and North east
regions have no grid connected wind power plant as of March, 2015 end. Wind
power accounts for 6% of Indias total installed power capacity, and it generates
1.6% of the countrys power. Wind power is already competitive, meaning the
levelized cost of electricity from wind power is the same or lower than that from
fossil fuels, and would not require any government support.
Wind is a clean source of power. It accounts for around 70% of Indias
source of renewable energy. It is cost effective and can be built on existing
farms. It has also led to job creation in countries like Germany and the USA.

However wind turbines can be situated in selected location that have the
required wind speeds. Normally these sites are located far from cities which are
the consumption end points. Higher distance leads to transmission losses. They
also occupy large tracts of land that cannot be then used for any other purpose.
Turbine blades can cause damage to local wildlife as well.
Wind Energy Initiatives in India
a) National Offshore Wind Energy Policy 2015

To promote deployment of offshore wind farms up to 12 nautical miles

from coast.

To promote investment in energy infrastructure.

To promote spatial planning and management of maritime renewable

energy resources in the exclusive economic zone.

To achieve energy security and reduce carbon emissions.

To encourage indigenisation of offshore wind energy technology.

To promote R&D in the offshore wind energy sector.

b) National Institute of Wind Energy (NIWE) has been established in Chennai

in the year 1998, as an autonomous R&D institution by the Ministry of New and
Renewable Energy (MNRE), Government of India. It is a knowledge-based
institution of high quality and dedication, offers services and seeks to find
complete solutions for the kinds of difficulties and improvements in the entire
spectrum of the wind energy sector by carrying out further research.
c) Excise duty exemption Full exemption on excise duty is being provided on
Pig Iron (SG grade) and ferro-silicon-magnesium for use in the manufacture of
cast components of wind-operated electricity generators.

d) Accelerated Depreciation has been reintroduced after being withdrawn in

2012. It is as high as 80% on initial capital invested.
e) Generation Based Incentives GBI will be provided to wind electricity
producers @ Rs. 0.50 per unit of electricity fed into the grid for a period not less
than 4 years and a maximum period of 10 years with a cap of Rs. 100 Lakhs per
MW.
2) Solar Power India is densely populated and has high solar insolation, an
ideal combination for using solar power in India. Much of the country does not
have an electrical grid, so one of the first applications of solar power has been
for water pumping, to begin replacing Indias four to five million diesel powered
water pumps, each consuming about 3.5 kilowatts, and off-grid lighting. Some
large projects have been proposed, and a 35,000 km area of the Thar Desert
has been set aside for solar power projects, sufficient to generate 700 to 2,100
gigawatts.
As of 31 August 2015, the installed grid connected solar power capacity is
4,229.36 MW.
Solar Energy Initiatives in India
a) Solar Loan Programme Launched in 2003, the Indian Solar Loan
Programme was a four-year partnership between UNEP, the UNEP Risoe Centre,
and two of Indias largest banks, the Canara Bank and Syndicate Bank. The
Indian Solar Loan Programme, supported by the United Nations Environment
Programme has won the prestigious Energy Globe World award for
Sustainability for helping to establish a consumer financing program for solar
home power systems. Over the span of three years more than 16,000 solar
home systems have been financed through 2,000 bank branches, particularly in
rural areas of South India where the electricity grid does not yet extend.

b) Jawahar Lal Nehru National Solar Mission The Jawaharlal Nehru National
Solar Mission was launched on the 11th January, 2010 by the Prime Minister.
The Mission has set the ambitious target of deploying 20,000 MW of grid
connected solar power by 2022 is aimed at reducing the cost of solar power
generation in the country through (i) long term policy; (ii) large scale
deployment goals; (iii) aggressive R&D; and (iv) domestic production of critical
raw materials, components and products, as a result to achieve grid tariff parity
by 2022. This target has been increased to 100,000 MW by 2022.
c) National Institute of Solar Energy National Institute of Solar Energy, an
autonomous institution of Ministry of New and Renewable (MNRE), is the apex
National R&D institution in the field Solar Energy. The Government of India has
converted 25 year old Solar Energy Centre (SEC) under MNRE to an
autonomous institution in September, 2013 to assist the Ministry in
implementing the National Solar Mission and to coordinate research, technology
and other related works.
d) Renewable Purchase Obligation (RPO) mechanism is in place to drive
demand for solar power in India until parity in terms of landed cost of power
between renewables and other energy sources is widely reached. To comply
with RPOs, electricity distributors or discoms can either generate a
minimum amount of renewable power or purchase renewable energy certificates
(RECs) to make up for shortfalls.
e) Exemption from excise duties and concession on import duties on
components and equipment required to set up a solar plant.
f) A 10-year tax holiday for solar power projects.
g) Generation Based Schemes for small solar projects connected to a grid below
33KV.

h) A subsidy of 30% of the project cost for off-grid PV and solar thermal
projects. Loans at concessional rates for off-grid applications.
i) Special incentives for exports from India in renewable energy technology
under renewable sector-specific SEZ.
3) Biomass and waste to energy Every year, about 55 million tonnes of
municipal solid waste (MSW) and 38 billion litres of sewage are generated in the
urban areas of India. In addition, large quantities of solid and liquid wastes are
generated by industries. Waste generation in India is expected to increase
rapidly in the future. As more people migrate to urban areas and as incomes
increase, consumption levels are likely to rise, as are rates of waste generation.
It is estimated that the amount of waste generated in India will increase at a
per capita rate of approximately 1-1.33% annually.
India has had a long involvement with anaerobic digestion and biogas
technologies. Waste water treatment plants in the country have been
established which produce renewable energy from sewage gas, however there is
significant un-tapped potential. Also wastes from the distillery sector are on
some sites converted into biogas to run in a gas engine to generate onsite
power.
4) Small Hydroelectric Projects A number of mini/micro hydro projects
have been set up in remote and isolated areas, mainly in Himalayan & Western
Ghat region. While these projects are developed by various state agencies
responsible for renewable energy, the projects are normally maintained by
entrepreneurs or by local communitys / Gram Panchayat / tea garden
owners participation.
It has been estimated that there are more than 1.5 lakh potential water mill
sites in the Himalayan regions of India. With the R&D efforts, new and improved
designs of water mills have been developed for mechanical as well as electricity

generation of 3-5 kW. These designs were tested at AHEC, IIT Roorkee and
have been replicated by 6-7 small scale manufacturers.
To encourage and accelerate the development of water mills and micro hydel
projects in the remote & hilly areas, a scheme for providing Central Financial
Assistance (CFA) during 2014-2015 and the remaining period of the 12th Five
year Plan for development/upgradation of watermills and setting up of micro
hydel projects upto 100 kw capacity to State Governments.