300 Sunny days a year, but TN fails to make hay

CHENNAI: With tariff hikes sending energy bills up since September, the rooftop solar option has become more attractive than ever before. And going solar is rather a simple choice in a State like Tamil Nadu, which has 300 sunny days a year. However, hesitancy prevails amongst the public, thanks to a lack of clarity in govt policy, misconception or lack of awareness.

It is clean and green. But that has not prompted many to choose solar power to meet their energy needs. However, the shock that they received after the tariff hike that came into force in September, many domestic consumers are increasingly looking at the sun to ease the pressure on their purse.

The tariff hike has sent up the energy bills since September. For some category of domestic consumers, the increase is as high as 52 per cent. According to industry sources, this has made rooftop solar more attractive than ever before, as it offers to cut energy bills – which saves more money each passing year after the government decided to increase tariff annually from now. This would translate to a substantial saving over the panels’ lifetime of 25 years.

“We had stopped doing the domestic rooftop solar projects as there was not much interest among the consumers three years ago owing to changes in the policies,” said M Shivakumar, chief executive officer of NIRT Renewable Energy Pvt Ltd. The number of enquiries has gone up after the electricity tariff hike, he said, adding: “Now with the interest growing, we are going to focus again on the domestic sector.”

Going solar is a rather simple choice in a State like Tamil Nadu, which has 300 sunny days a year. This would mean a one-kilowatt rooftop solar plant could generate as much as five units a day under clear and strong sunlight. In other words, a one-kW solar plant could generate between 1,400 to 1,500 units a year.

Installing the system is not exactly cheap, with the cost starting from Rs 65,000 a kW onwards. But is it the right approach to calculate the return on investment (RoI)? Not all agree.

Dwarkadas Suresh, popularly known as ‘Solar’ Suresh, has been using rooftop solar-generated power since 2012. Suresh said that he had started with a kilowatt solar plant and subsequently increased it to three kW. Now he has installed four kW solar panels additionally, taking the total capacity to seven kW, as the household energy consumption has gone up because his son and daughter-in-law are staying in his house. Prior to installation of the rooftop solar plant, his energy bill was Rs 4,000. It has come down drastically to just Rs 400 now – or Rs 6.60 per day.

“I have been encouraging people to install solar panels at their homes to generate their own energy for the past 12 years. I always tell them that installing a rooftop solar plant would insulate them from the power tariff hike. But many people have not done it due to misconception or lack of awareness,” he said.

Even as he thinks there will be more interest for rooftop solar after the tariff hike, Suresh feels it will slump again after some time. “There is no clarity on whether there is a government subsidy or not. But I am telling people to install solar panels even without the subsidy. People don’t think about return on investment when they buy an air conditioner, a two-wheeler or a car. But they ask what is the RoI of solar plants,” he said.

Agreeing with him, AD Thirumoorthy, a renewable energy consultant, said with the steep increase in the electricity tariff and with the availability of net metering facilities, more domestic consumers would be interested in going solar. “With the energy charges going up to Rs 11 per unit for the higher slab in the domestic category, solar power offers higher savings for the residential consumers,” he said.

TEDA to empanel vendors for installing rooftop solar plants with MNRE subsidy

The reintroduction of net metering for the rooftop solar system would help domestic consumers reduce energy bills drastically, said P Ashok Kumar, president, Tamil Nadu Solar Energy Developers Association.

The additional incentive is the Tamil Nadu Energy Development Agency (TEDA) scheme that offers a 40 per cent subsidy for domestic rooftop solar plants under phase II of the Ministry of New and Renewable Energy’s Grid-connected Rooftop Solar Programme. “TEDA will soon launch the programme with enlisted vendors to avail the central financial assistance,” he said.

Under the programme, projects up to three kW will receive 40 per cent subsidy in terms of benchmark cost, which is approximately Rs 40,000 per kW. The projects between 3 kW and 10 kW will receive a 40 per cent subsidy for the first 3 kW and 20 per cent for the remainder.

Though there is no subsidy beyond 10 kW capacity, group housing societies and residential welfare associations will receive a 20 per cent subsidy for up to 500 kW for common facilities.

Let’s break down the cost. A one-kilowatt capacity rooftop solar plant would cost Rs 73,686, including GST. Domestic consumers would be eligible for 40 per cent subsidy, which works out to Rs 21,359.

“If a consumer installs a three kW capacity solar system, he would have to spend Rs 1.32 lakh considering the subsidy of Rs 57,383. The rooftop solar panels would generate about 750 units during the bi-monthly period, which translates to a saving of Rs 3,000. They would be able to get back their investment in three to four years. For the rest of the 21 years, they can enjoy the free power generated by the solar plant,” Ashok Kumar explained.

Sources in the TEDA said that the list of empanelled vendors would be announced on the agency website within two to three weeks. “We have short-listed vendors through a tendering process. Once the list of empanel vendors is released, the consumers will be able to choose vendors to install the rooftop solar panels,” officials added.

COST & WARRANTY OF ROOFTOP SOLAR PLANTS

• One kilowatt-capacity rooftop solar panel requires 80 sq ft of space

• Inverters are compact and can be mounted on walls

• If battery-connected, it will require space for two 100 ah capacity cells

• It should also have a provision for maintenance

• The cost of a kW capacity rooftop solar starts from Rs 65,000

• Panels come with 25 years warranty

• Inverter comes with a five to 10-year warranty

• For battery connected, the cost will go up by Rs 30,000 (for batteries). It is a recurring expenditure

NET BILLING OR NET FEED-IN?

The energy imported from the grid and energy exported from grid-tied rooftop solar PV systems are valued at two different tariffs. The monetary value of the imported energy is based on the applicable retail tariff, while that of the exported solar energy is calculated based on a feed-in tariff determined by the central or State regulatory commission. The monetary value of the exported energy is deducted from the monetary value of the imported energy to arrive at the net amount to be billed (or credited/carried over).

Increase in charges makes solar not so attractive for commercial, industrial sectors

The increase in transmission charges and open access charges have made renewable energy a not-so-attractive investment for commercial and industrial sectors.

TNERC has steeply increased wheeling charges from Rs 0.21 per unit to Rs 0.96 and transmission charges from Rs 3,037.30 per MW per day to Rs 5,159. For both the wheeling and transmission charges, the wind and solar generators will get a 50 per cent concession in charges. The system operating charges from Rs 33.74 per MW per day to Rs 69.84 will make renewable energy and open access systems unviable.

Tamil Nadu Spinning Mills Association chief advisor Dr K Venkatachalam said Tangedco issued a circular post its tariff order to collect network or wheeling charges at the rate of Rs 0.96 per unit from all renewable consumers including those with rooftop solar and ground-mounted solar inside the industries premises. He said he had written to Tangedco to modify the circular.

In the grid-interactive solar system order last year, TNERC levied network charges of Rs 0.83 per unit on the rooftop and ground-mounted solar within the premises of the industries for self-consumption. “We have appealed against the order of the Appellate Tribunal for Electricity which is still pending,” he said.

Venkatachalam noted that TNERC in the recent tariff order has created confusion by equating wheeling/network charges. The wheeling charges are collected for wheeling the energy from solar plants installed outside premises using the grid, he said, adding on the wheeling charges of Rs 0.96 per unit, the solar and wind generators are eligible for concession of Rs 0.48 per unit.

He also said that Tangedco calculates the network charges on the rooftop solar based on the cumulative utilisation factor of 21 per cent. “We have challenged it in the Madras High Court and got a stay on it,” he said.

AD Thirumoorthy, a renewable energy consultant, said the benefit HT consumers get from investing in renewable energy for their use is almost Rs 2 a unit and will come down now. This will increase the break-even period.

Extend rooftop net metering to common supply in apartments

Tamil Nadu Solar Energy Developers’ Association has urged the Tamil Nadu Generation and Distribution Corporation to extend the rooftop solar net metering for the common facilities in the apartments and group housing as they are used purely for domestic purposes.

After the creation of a separate high-tariff category for power supply to common facilities in the apartments and group housing, the domestic consumers in such residential complexes also feel that installation of the rooftop solar plant with net meters would help them overcome the high energy charges to be paid by them.

In the recent tariff revision, the common facilities like common lighting, water pumping and lifts in the apartments and group housing, which were covered under the domestic tariff earlier, were shifted to the new I-D tariff category. Under the new tariff category, a unit will cost Rs 8 and a fixed charge of Rs 100 per month per kilowatt would apply.

“We have requested Tangedco to extend the net metering facility up to 10 kW for the domestic common supply consumer category as well,” said P Ashok Kumar, president of the association.

He said as per the Tamil Nadu Electricity Regulatory Commission’s last year’s order on the grid-interactive solar system, the rooftop solar for the common supply connections would fall under the net feed-in category.

Net metering offers a better return on investment than net feed-in. T Nagar Residents’ Welfare Association president V Jayaraman said after forcing a double tariff hike on people living in the apartments, Tangedco should at least extend the net metering facilities for the common power supply to enable the residents to invest in rooftop solar to generate their own power.

With the installation of solar net metering, the consumer would be paying the difference between the energy generated (export) by the solar system and energy consumed (import) from the grid. If the consumer generated more than consumed, the excess generated power will be carried over to the next billing cycle.

Sources in Tangedco said that even providing the net feed-in facility for the new tariff category I-D has to be approved by the TNERC. “They would be filing a clarification petition with TNERC in this regard,” sources said, adding extending the net metering facility for the common supply connection is not under consideration.

NET METERING

It refers to a mechanism whereby solar energy exported to the grid from a grid-tied rooftop solar photovoltaic (PV) system of a ‘prosumer’ (an individual who produces and consumes) is deducted from the energy imported from the grid in units (kilowatt-hours) to arrive at the net imported/exported energy. In simpler terms, this means it calculates how much energy the consumer draws from the State grid and how much she/he exports to the grid, and calculates the net energy import or export to raise the bill. If more energy is exported than consumed, it would be credited/carried over by the distribution licensee on the basis of the applicable retail tariff. A single bidirectional energy meter is used for net metering at the point of supply.