Current Status of Solar energy in India

6/26/2012 Ayyati.com Mansi Goel

TABLE OF CONTENTS

1. Introduction 2. Solar Energy & the World Solar Energy installed capacity (2010) 3. Solar Energy & India Viable locations Status of SE in India in comparison to other Renewable Energy Resources Status of SE generation in India (2010) Summary of installed SE utilization devices Market analysis: Solar PV cell production in India Installed projects Other ongoing projects 4. SE policies in India Policies so far: A Timeline Central Government policies State Government policies JNNSM road map Realistic scenario vs. Projected JNNSM targets by 2022 5. Discussion 6. Conclusion 7. Bibliography

2 3 3 4 4 5 7 9 9 10 11 13 13 14 14 15 15 16 17 18

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INTRODUCTION
Solar energy is the utilization of the radiant energy from the Sun. Solar power is often used interchangeably with solar energy but refers more specifically to the conversion of sunlight into electricity. Earth receives 174 petawatts (PW) of incoming solar radiation (insolation) at the upper atmosphere. Approximately 30% is reflected back to space while the rest is absorbed by the clouds, oceans & land masses. The total global solar radiation striking a given surface has two components, direct beam and diffuse radiation. Direct beam radiation (or direct normal irradiance, DNI) comes as parallel beams from the sun like on sunny days with clear skies. On overcast days, DNI is negligible. As solar radiation passes through the earths atmosphere, part of it is absorbed or scattered. This scattered radiation is diffused solar radiation. Radiation, whether diffused, beam, or global in a particular region is measured in kilo watt hours per square metre per year. Solar radiation along with secondary solar resources such as wind & wave power, hydroelectricity & biomass account for over 99.9% of the available renewable energy on Earth. The total solar energy absorbed by Earths atmosphere, oceans & land masses is approximately 3850 zetta joules (ZJ) per year. India will soon become one of the worlds largest photovoltaic solar energy markets. While it boasts off the best solar resources in the world with 260-300 clear sunny days per year; it is also dealing with continuous power deficits which have increased over the past few years. Because of its location between the Tropic of Cancer and the Equator, India has an average annual temperature that ranges from 25C 27.5 C. This means that India has huge solar potential. Solar lightings, though light millions of Indian households but around 100,000 villages and 450 million people still live in dark. The governments recent announcement of The National Solar Mission brings much hope with its target 20,000 megawatts of cumulative installed solar power by 2020. Talking in terms of power statistics there is a huge demand/supply gap of 12% on average which even rises to 15% for progressive states. Its a shame for worlds sixth largest energy consumer that it has installed power capacity only of 150, 323, MW. The average per capita energy usage which is 632kWh per annum today is only expected to increase to 1000kWh by the beginning of 2013 which is not even close to half of the current usage in western economies.

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SOLAR ENERGY & THE WORLD

India still is not among the world's top 10 solar energy generators. But yes, its the only country in the world with an independent Ministry for renewable energy, known as the Ministry of New and Renewable Energy [MNRE]. Solar energy installed capacity (2010)
Country Germany Spain Japan Italy U.S. France China India Installed capacity (MW) 17193 4317 3622 3494 2660 1025 893 10
Source: U.S. Department of Energy

As is visible from the graph below, the solar energy would be replacing all other forms of energy in the coming future.

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SOLAR ENERGY & INDIA

Viable locations

Map showing Direct Normal Irradiance

Map showing Global Horizontal Irradiance

Rajasthan This largest state in India receives maximum solar radiation intensity in India. According to US Department of Energy, Rajasthan receives the second largest amount of solar radiation in the world. Rajasthan is best suited for solar power generation since average rain fall is minimum. Rajasthan has around 208,110 Sq.km of desert land. Rajasthan has more than 325 sunny days in a year with solar radiation of about 6-7Kwh/sq-m/day. The DNI over Rajasthan varies from 1800 kWh/m2 to 2600Kwh/m2. Jodhpur in Rajasthan is receiving maximum solar radiation which is known as Sun City of India Gujarat Gujarat receives second largest amount of solar radiation in India. Gujarat receives 5.5 to 6 KWh/sq.m/day with 300 sunny days/year. Most locations in Gujarat receive an annual Direct Normal Incidence (DNI) in between 1,800 - 2,000 KWh/m2.

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 Tamil Nadu After Rajasthan and Gujarat, Tamil Nadu receives the third largest amount of solar radiation in India. Tamil Nadu receives about 5.35Kwh/sq.m/day. Now some companies are taking initiative for solar power projects in Tamil Nadu. Maharashtra Dhule and Jalgaon from north Maharashtra, Osmanabad and Aurangabad from Marathwada and Chandrapur and Wardha districts of Vidarbha have the highest exposure to solar rays. Status of Solar energy in India in comparison to other Renewable Energy Resources

Source-wise Installed capacity of Grid Interactive Renewable Power in India

Date Mar09 Mar10 Mar11 Biomass power
1752.33 2199.63 2664.63

Waste to energy
59 64.96 72.48

Wind power
10242.30 11929.25 14155.85

Small hydro power

2180.85 2735.42 3042.92

Solar power
2.12 10.28 35.15

A State-wise and source-wise comparison of the installed capacity of Grid interactive renewable power as on 31-03-2010 and 30-03-2011 is also been listed in the table below from where it can be inferred that Tamil Nadu by far has the Greenest Electricity in India followed closely by Karnataka and Maharashtra, coming mainly from the winds (wind energy). Solar Power is still taking its baby steps.
Table showing state-wise & source-wise installed capacity of grid Interactive Renewable power as on 31.03.10 & 31.09.11

State Andhra Pradesh Punjab Gujarat Himachal Pradesh Karnataka Maharashtra Rajasthan Tamil Nadu

Small hydro power (MW) 2010 2011

186.8 132.5 12.60 330.3 640.4 245.3 23.85 90.05 191.4 154.5 15.60 393.4 783.4 274.1 23.85 96.55

Biomass power (MW) 2010 2011

363.2 62.5 0.5 336.2 218.5 31.3 395.7 363.2 74.5 0.5 365.2 403 73.3 488.2

Waste to energy (MW) 2010 2011

35.66 9.25 1 5.7 5.65 43.16 9.25 1 5.72 5.65

Wind power (MW) 2010 2011

122.5 1864 1473 2078 1088 4907 191.5 2176 1727 2317 1525 5904

Solar Power (MW) 2010 2011

0.1 1.33 6 0.15 0.05 2.1 2.33 5 6 4 5.15 5.05

Total (MW) 2010 2011

721.9 205.6 1877 330.3 2456 2547 1144 5398 791.4 240.6 2198 393.5 2882 3005 1627 6500

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State-wise & source-wise installed capacity of grid Interactive Renewable power as on 31.09.11

It is evident from the figures above that wind power takes up most of the share of the Renewable resources in our country. This is because the initial installation cost is very less compared to other energy sources and also India receives a variety of winds. Solar energy has been used since times immemorial but for power generation purposes its a new kid on the block. Even then it has caught up quite well (more than 300% growth in 1 year) provided the fact that the initial installation costs are way too high and that is evident from the table below.

Growth curve of Solar Power in India

40
Power (MW/Hour)
30 20 10 10.28 2.12 Mar'09 Mar'10 Mar'11 Solar Power 35.15

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This looks like a good sign. But what doesnt seem good is worlds growing need for energy. The price of peak electricity in 2010 is assumed to be around Rs.6.50 per unit. If carbon cess becomes a reality, the cost of generation of thermal power will increase substantially in the coming years. Using inflation rates of 5%, 6% and 7%, the peak price is projected till 2022. The following figure shows the peak price of electricity from the grid increasing, while the per unit price of electricity from solar PV decreasing. Grid parity, it appears, will happen anywhere between 2018 and 2020. This means that anytime near 2018 we can hope to have green electricity lighting our homes 24X7!

Status of Solar Energy generation in India (2010)

Solar Photovoltaic India has one of the largest SPV (solar photovoltaic) markets, driven by government programmes of subsidies, tax, and financial incentives that began in the 1980s. Under the PV programme of the MNRE, over 610000 systems aggregating to over 20 MW have been installed. This includes solar lanterns, home lighting systems, street lighting systems, water pumping systems, and an aggregate capacity of about 1.2 MW of standalone power plants. Solar Lanterns Solar Home lighting system Solar street lighting system Solar water pumping system 7.7 lakh 5.1 lakh 82,500 7,247

A new niche application of PV stand-alone power plants is in the unelectrified areas. It is estimated that for the 18000 unelectrifiable villages in India located in far-flung areas inaccessible to the grid, stand-alone SPV systems

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will be instrumental in providing a limited amount of electricity. The MNRE is designing a programme to undertake this task.

Solar Thermal A subsidy-based solar thermal programme was launched in India in 1984 and continued up to 1993. Capital subsidy was removed and provision for soft loan was introduced in 1994. An integrated solar combined cycle power project is planned at Mathania in the state of Rajasthan. This plant of total capacity 140 MW has a solar thermal component of 35 MW, based on the parabolic trough collector technology. Solar Water Heating system In India, the first serious attempt to deploy the technology was made with the formation of the Department of Non-conventional Energy Sources. In 1982, though the history of research & pilot-demonstration go back to the 1960s. Today, India ranks 5th in terms of SWHS installations, accounting for 1.4% of the total heating capacity through solar water heaters around the world.
Table below lists down the Indian Solar water heating scenario as per UNDP-GEF Global solar Water Heating Project

Techno-economical potential National Solar mission goal Demand Projection Cumulative achievement Pre-project baseline

40 million sq. m 7 million sq. m by 2013 20 million sq. m by 2022 5.4 million sq. m by 2013 18.7 million sq. m by 2022 3.52 million sq. m up to 2010 2.55 million sq. m as on Oct08

Solar Cooker One solar thermal application in which India appears to be the world leader at present is cooking. About 600,000 family solar cookers have been installed in the country so far; most of these are of box type, the number of dish type being about 6,000. Apart from outdoor family type cookers, concentrating community cookers have been introduced in recent years.

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Summary of Installed Solar energy utilization devices

SPV Pumps 85 551 228 283 829 Solar Photovoltaic SLS 2004 2694 8420 6852 6350 HLS 9231 36134 2431 91754 7536 SL 31603 7334 8683 4716 16816 PP (kWh) 336 225.4 850 990 67.73 Solar Cooke r 17067 5 253 58044 36682 1536

State Gujarat Karnataka Maharashtr a Rajasthan Tamil Nadu

[SPV: Solar Photo Voltaic; SLS: Street Lighting system; HLS: Home Lighting System; PP: Power Plant]

Market Analysis: Solar PV cell production in India

About 40 companies are actively engaged in manufacturing solar cells and panels, and many more companies produce end products such as solar lanterns, street lamps etc. The production in the country during 2009-10 is estimated to be about 230 MWp of solar cells and 325 MWp of PV modules. Nearly 90% of the solar modules manufactured in India use crystalline silicon C-Si technology, while only 10% of the solar modules are manufactured using thin film technology. As of end 2009, the cumulative production of solar PV cells in India has been about 800 MW. Of this total, only a small portion has been used in applications within India, while the rest have been exported. Of the total amount of solar cells cumulatively used in India, the following are the areas in which they have been applied. India had an installed solar power capacity of 1700 MW in 2007 which amounted to roughly 1% of its total power generation of 130,000 MW. India is currently ranked 7th in the world in Solar PV cell production The major role players for the production of solar energy in India are: Tata BP Solar Moser Baer Central Electronics Ltd. SELCO BHEL etc.

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 Azure Power had set up a 5MW solar PV power plant in Khadoda village in Gujarat. It had invested around Rs. 1700 million towards the project and is adding another 5MW which is under implementation. The solar plant is connected to GSEB grid. NKG infrastructure allotted a solar power project of 10MW capacity at solar park, Patan district in Gujarat. The company has signed a PPA with Gujarat Urja Vikas Nigam Limited. Louroux has signed an agreement with the state of Gujarat to execute a 25MWp solar PV project. The project is scheduled for commissioning in December 2011. For project execution, the company has established tie-up with a leading European solar Engineering company for project execution. Tata Power is developing a 25MW solar project at Mithapur in Gujarat. Tata Power also signed a PPA with GUVNL at a rate of Rs. 10-12. The solar plant will use crystalline silicon photovoltaic technology and is likely to be commissioned by end of 2011. Adani Power Limited is setting up a 100MW solar power project at Surendranagar at Gujarat. A PPA has been executed with GUVNL for 40MW in the first phase. Moser Baer completed the biggest solar powered plant in Gujarat in October 2011. The thin film panels for the project are supported by First Solar. The plant will generate 52 million kilowatt hours or enough electricity for 50,000 homes per day. PLG Power has signed a PPA with GUVNL for 40MW of solar power. PLG power will set up PV power projects in Patan district in Northern Gujarat. The first phase of 10MW solar plant in Patan will be connected shortly and the balance will be done before end of the current fiscal. PLG has signed EPC agreements with the Saudi-based Zamil group for 20MW solar grid connected plant and Indo-wind energy for 10MW solar power plant in Gujarat.

Installed projects Though the percentage of solar energy generated in India is only 0.4% compared to different resources but till October 2009, the country shared the first position with the United States in regards to Solar Power production capacity. Due to its high primary price of deployment, solar energy is prohibitive at present and it can be promoted to a flourishing solar market only if the technology becomes competitively cheaper by attaining cost uniformity with nuclear energy or fossil. A number of solar power projects in India have been undertaken for the proper utilization of solar energy in India. Indian Government has promoted the utilization of solar power through diverse strategies. The Shirdi solar system which is built with a cost of 133 lakh rupees generates 3500 kg of steam enough to cook for 20,000 people. The whole system is installed in less than 10 months and it saves Shirdi temple 20 lakh rupees per year (in terms of the money spent on 1 lakh kg of LPG which they spend now). 40 solar parabolic concentrators move in the direction of sun and raise the temperature of water which will then produce the steam.

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 The Tirumala Tirupati Devasthanam, Tirupati (AP): The solar system can cook 30,000 meals per day and 15,000 meals at a time. The system curbs fuel consumption by nearly 50 per cent thereby saving Rs 17 lakh per year for the Devasthanam. The system is comprised of 106 rooftop-mounted parabolic concentrators.
A 5GW Solar Power plant project has been commissioned in Madhopur, Bhuj, Gujarat costing $475 million. The current largest solar array in the world produces 900 megawatts of power, so this 5 gigawatts plan gives you an idea of its scope. Chemists at the University of California, Berkeley, have discovered a way to make cheap plastic solar cells that could be painted on almost any surface. Konarka Technologies are already manufacturing a product called, Power Plastic which absorbs both sunlight and indoor light and converts it into electricity, which has efficiency around 8%.

Other ongoing projects 1. Solar Radiation Resource Assessment across India

States Rajasthan Gujarat Tamil Nadu Andhra Pradesh Karnataka Maharashtra Madhya Pradesh Jammu & Kashmir Chhattisgarh Pondicherry Haryana Total No. of ASRMS Proposed Completed 12 11 7 6 5 3 3 1 1 1 1 51 12 11 7 6 5 3 3 1 1 1 1 51

MNRE has initiated a major project on Solar Radiation Resource Assessment (SRRA) across the nation to assess and quantify the solar radiation availability along with weather parameters with a view to develop Solar Atlas. Centre for Wind Energy Technology, Chennai is implementing the project by Installing a network of 51 Automatic Solar Radiation Monitoring Stations (ASRMS) in the first phase in different states.

Each ASRMS consists of two towers of 1.5 m and 6 m tall each. The 1.5 m tall tower houses a Solar Tracker equipped with Pyranometer, Pyranometer with Shaded Ring and Pyrheliometer to measure solar parameters, such as, global, diffused and direct radiation. The 6 m tall

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tower houses instruments measuring rainfall, ambient temperature, atmospheric pressure, relative humidity, wind speed and direction. 2. Performance of Grid Solar PV Power Plants under Demonstration programme Under the demonstration programme on megawatt size grid solar power plants, announced in Jan08, a total of six grid connected solar PV Power projects have been commissioned in the country. The 1st plant was commissioned in Aug09 in West Bengal & the latest plant was commissioned in Mar11 in Andhra Pradesh. A brief summary of the status of these projects is given below:
S.No Project Developer WBGEDCL-I (Sept09-Aug10) WBGEDCL-II (Sept10-Apr11) Azure-I (Dec09-Nov10) Azure-II (Dec10-Jun11) Mahagenco-I (May10-Apr11) Mahagenco-II (May11-Jun11) Reliance (Jul10-Jun11) Sapphire (Dec10-Jun11) Sri Power (Mar11-May11) Project site Jamuria, Asansol, W.B. Jamuria, Asansol, W.B. Awan, Punjab Awan, Punjab Amritsar, Amritsar, Nominal capacity (MW) 1 1 1 2 1 1 5 5 2 Period of Operation (Days) 365 242 365 212 365 61 352 190 92 Actual Generation (MW) 1130700 730500 1571610 1740480 1347840 273640 7473378 4271319 901900 Highest CUF % so far 14.93 14.54 20.73 20.90 20.21 21.04 23.63 20.37 22.48 Month of Highest CUF % Mar10 Mar11 Apr10 Apr11 Apr11 May11 Mar11 May11 Mar11

1. 2. 3. 4. 5. 6. 7. 8. 9.

Chandrapur, Maharashtra Chandrapur, Maharashtra Nagaur, Rajasthan Siva Ganga, Tamil Nadu Chittora, Pradesh Andhra

(WBGEDCL: West Bengal Green Energy Development Corporation Limited)

Four of these plants have completed one year of their operation and for these plants the net Capacity Utilization Factor (CUF) of the plant has been calculated. S.No. 1. 2. 3. 4. Project Developer WBGEDCL Azure Mahagenco Reliance Lowest CUF % so far 10.52 8.17 9.9 10.17 Month of lowest CUF % Dec09 Jan10 May10 Aug10 Actual CUF % 12.29 16.92 15.39 18.80

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The CUF of these four plants is in the range of 12.29 % to 18.8%. From the overall performance, the plant in Rajasthan is the best at present. Except for the plant in West Bengal, which was the first plant and a part of the initial learning curve the average CUF of all other plants is in the range of 15% to 19%. Except for WBGEDCL project where the highest CUF was 14.93%, all other plants have achieved highest CUF in the range of 20.21% to 23.63%.

SOLAR ENERGY POLICIES IN INDIA

Policies so far: a Timeline
Year Policy Description Overall objective was to cover at least 60% of villages in each state and union territory under the rural electrification programme by 1990; a target of 46464 additional villages was fixed for the 6th plan under the MNP. The actual achievement however, was estimated at 34489 villages. Launched for extending single point light connections to households of rural poor families below the poverty line including harijan and aadiwasi families. The definition of an electrified village was changed (among other things) to at least 10% of the total no. of households in the village being electrified.

1974-79

MNP : Minimum Needs Programme

1988-89

Kutir Jyoti Scheme Definition of Electrified village under the Ministry of Powers Memorandum No. 42/1/2001-D(RE) Rajiv Gandhi Gramin Vidyutikaran Yojana (RGGVY)

5th Feb, 04

Apr05

This was a major initiative towards universal electrification under the programme, 90% grant is provided by the Central government and 10% as loans by the rural electrification corporation (REC) to the state governments. The REC is the nodal agency for the programme. Access to electricity for all households by 2009. Quality and reliable power supply at reasonable rates Minimum supply of 1 unit per household per day as a merit good by 2012 To encourage semi-conductor and ecosystem manufacturing, of which solar PVs also a component A capital subsidy of 20% for manufacturing plants in special economic zones (SEZ) and 25% for manufacturing plants outside of SEZs, based on the condition that the net present value (NPV) of the investment is at least US $2012 million (Rs. 10000 million [Rs. 1000 crores] @ US $1=Rs.47) The plan has an ambitious target of generating 20,000MW solar power by 2020; the mission strategy consists of 3 phases Release of mission document

2006

Rural Electrification Policy

2007

Semi-conductor policy

3rd Aug 09 14th Nov09

Draft of National Solar Mission approved by PM JNNSM

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3rd Dec09

Central Electricity regulatory Commission (CERC) announces tariff for Renewable energy power generation Policy launch of JNNSM JNNSM off-grid guidelines

For solar power, the tariff period has been specified as 25 yrs. The CERC has determined the tariff of Rs.18.44/kWh for solar PV projects and Rs.13.45/kWh for solar thermal projects commissioned in FY 2009-10 The mission targets 20,000MW of solar generating capacity by the end of 13th five year plan (2022) Guidelines for off-grid and decentralized solar applications and rooftop and other small power plants released. Guidelines for selection of new grid-connected projects with CERC determined tariff of Rs.17.91/kWh for solar PV projects and Rs.15.31/kWh for dollar thermal projects commissioned in FY 2010-11 and 2011-12. The tariffs for solar projects where PPAs are signed after 31 st Mar11 have been revised to Rs.15.39 for PV and Rs.15.04 for solar thermal projects.

11th Jan,10 17th Jun10

25 Jul10

th

JNNSM grid-connected guidelines

15th Sept,10

CERC tariff order

Central Government Policies NAPCC: In order to achieve a sustainable development path that sustainable advances economic and environmental objectives on Jun 30th, 2008, the National Action Plan for Climate Change was framed with eight core missions including National Solar Mission renamed as Jawaharlal Nehru National Solar Mission (JNNSM). Custom duty has also been pegged at a low 5% on equipment for Solar Photovoltaic and Solar Thermal Power. These equipment will also be exempt from central excise duties. Excise will also be reduced from 8% to 4% on Led Lights. A Unique solar powered rickshaw developed by CSIR will attract a mere 4% excise duty and its components will be exempted from Customs duty. Carbon Offsets can be used to compensate for the emissions produced by funding an equivalent carbon dioxide saving somewhere else. 1 kW of solar power with an average of 5.5 hours of sunlight per day will produce 1 carbon credit per year. 1 carbon credit is equal to 1 ton of carbon dioxide offset So far 30 million carbon credits are generated by India, in coming years 140 millions are expected, with 650 energy efficiency projects State Government Policies Some states like Gujarat and Karnataka have instituted independent solar policies and generation based tariffs that a developer will receive on signing PPA with a state electricity authority. The Gujarat Energy Development Agency (GEDA) has signed MOUs with developers for 365 MW of solar PV and 351 MW of solar thermal capacities.

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The Karnataka Power Corporation Limited has taken the lead and has commissioned 6MW (two 3 MW plants) solar PV capacity, and is soon commissioning one more 3 mw plant, bringing the total installed capacity of PV in Karnataka to 9MW. Other states such as Rajasthan and Haryana are in process of instituting solar policies. The Haryana Renewable Energy Development Agency (HREDA) has been promoting solar in a big way. JNNSM road map
Application segment Connected to high tension (HT) (>33kV) Connected to HT (<33kV) Capacity of 100kWp to 2MWp Connected to LT (400V)for 3 phase or 230V for 1 phase Capacity <100kWp Connected to HT (>33kV) Solar lantern Off-Grid Solar applications Solar home lighting systems Solar PV street lights Solar PV irrigation pumps Off-grid solar PV (micro grid) Solar thermal collectors (million sq. m) Current status as on 30-06-2010 12.28 MW JNNSM targets Phase-II Phase-III 2013-17 2017-22

Phase-I 2010-13 500MW 90MW

Solar PV

4000-10000 MW

20000 MW

797344 no.s 603307 no.s 119634 no.s 7334 no.s 292 MWp

10MW 500 MW

CSP

200 MW

1000MW

2000MW

Solar thermal applications

3.53

15

20

Realistic scenario vs. the JNNSM targets by 2022

Clearly, we are lacking in achievement of projected targets. The gap between the projected and real picture will, as seen from the curve, grow in future but will gradually be erased with the advancement in technology and growth in economy.

Area Installation (1000x sq. m)

20 15 10 5 0 2005
7 5.37 15 9.52

20 18.7

3.1
2010 2015 Year 2020 2025

Realistic Targeted

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DISCUSSION
With a the announcement of National Solar Mission in December 2009, there have been considerable discussions at all levels of society on solar technology, investment, policy and regulations in India. The Ministry of New and Renewable Energy (MNRE) has made laudable efforts in attracting investors, having released several rounds of guidelines for different applications. The demand for solar PV is already expected to exceed the target of 500 MW; though the future of CSP is less certain given that it are early days for the technology not just in India but globally. The target set for Phase 1 of 500 MW of utility scale solar PV are sliced in different ways as a means of illustrating societal and budgetary impacts.
Net present value of outlay towards phase 1 of the JNNSM

Annual installation Generation (million kWh) Price/Wp Tariff/kWh NPV of cash outlay of installation in that year (billion rupees) NPV of Phase 1 (billion rupees)

2010 30 53 180 17.91 8.54 108

2011 120 210 170 17.91 34.2

2012 120 210 159 16.3 31.1

2013 230 403 150 15.4 56.3

Providing 5.5 million households each with 37 watt panels or providing 4000 villages with 50 kWp micro grids will each work out to be 200 MW. The magnitude of this must be judged in relation to the 75000 villages and 28 million households that are currently un-electrified. Hence, off-grid applications for rural electrification should be prioritized considering it makes economic sense as well. To support the aforementioned, even at todays high prices, solar based micro grids offer a competitive solution compared to grid extensions .Moreover solar PV is ideally suited for generation near demand centers .Plus; there is an urgent need of meeting the electrification needs of rural India. Increasing the proposed capacity for rural electrification via decentralized options would have a far greater impact than grid extensions. There should be clear long term policy mechanisms in place to ensure that interest in solar investment remains .The current tariff of Rs.17.91 is for PV plants commissioned in the year 2010-11. Infusing certainty into the system with a degression algorithm, much like the German model, could go a long way in providing certainty and resulting in sustained investor interests. It is not at all clear to any of the stake holders what are the mechanisms to buy solar power in phases 2 and 3 will be. Without a clear road map, targets alone will, not lead to any of the pre requisites for reduction in the cost of solar power , namely, manufacturing set-up corporate R & D or high level human resources development (HRD).

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CONCLUSIONS
Solar power is a proven technology. Solar power is a clean and renewable energy source. It may be reliable energy source, if used as hybrid system with small hydro power or storage batteries to remote communities and islands that are not connected to grid. Solar PV is simple to operate and maintain. The lifespan of solar system is measured in years, which is generally 20-25 years. The electrical power output from solar system is mainly depend upon intensity of solar radiation, sunshine hours. There is huge scope for research in area of PV cell material, so that one can reduce the generation cost, because PV array is the most costly item in SPV system. Solar energy has the potential to generate virtually unlimited, essentially clean, carbon free electricity. Given that it holds great promise, with most parts of the country receiving plenty of sunshine- 4to 6 hours a day for over 300 days a year- India should look to the sun to reap the benefits of its energy. Power generation from solar PV does not produce noise or air pollution, and the replacement of kerosene with solar lighting will have significant positive effects on family health. The new guidelines and incentives announced by the MNRE are a marked improvement over previous policies. However, given the large out lay of public fund expected in the next few years, steps should be taken to ensure that the impact of the solar energy goes well beyond installed capacity.

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BIBLIOGRAPHY

1. Renewable Energy Data book 2010 handbook published by U.S. Department of Energy 2. Ministry of New & Renewable Energy website 3. National Renewable Energy Laboratory (U.S.A.) website 4. Annual handbook of Energy Statistics (2011 & 2012) - Ministry of Statistics & Programme Implementation 5. Harnessing Solar Energy: Options for India - book published by Centre for Science, Technology & Power 6. A Review of Solar energy Markets, Economies & Policy research paper by Govinda R. Timilsana, Lado Kurdgelashvili & Patrick A. Narbel 7. Present status & future prospect of Solar power in India research paper by Prafulla Krishnant Pise & Mukesh Kumar singhal 8. Final Report on Scheme & Framework for promotion Solar Water Heating system by Utilities & Regulators report by MNRE 9. Renewable energy & Energy efficiency status in India Report compiled by ICLEI South Asia 10. Overview of sustainable Renewable energy potential in India Report compiled by Global Energy Network Institute

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