India is staring at a power crisis as coal stocks at thermal plants are depleting. The Power and Coal ministries, on their part, have said that the fears of a crisis are misplaced, but distribution companies across the country are announcing power cuts. Commercial and industrial (C&I) consumers will be affected the most.
Solar developers believe that rooftop solar with a battery storage facility can help C&I consumers survive power cuts in the winter and save on power bills.
India is seeing a surge in power demand, with industrial and economic activity picking up pace in the past few months.
Mercom spoke to several solar developers to understand if rooftop solar with a battery storage system can be a solution to overcome the impending power crisis.
Vinay Pabba, Founder and Chief Executive Officer of Varp Power, said, “C&I consumers, in a few geographies with high tariffs, can use behind-the-meter solar and storage hybrids to mitigate power outages, with short duration storage, and continue their manufacturing during the outage period – especially during peak demand windows. A typical solar rooftop installation with 250-kW (DC) capacity with four-hour lithium storage may find some takers.”
“A 250-kW rooftop solar system with a 1 MWh (250KW X 4 hours) battery storage system would cost around ₹31.36 million (~$416,073). With this investment, C&I consumers can save money on power bills, reduce their confirmed demand, and have a mitigation plan for a short-duration power outage. But the main benefit is that their production will not be disrupted due to power cuts,” he said.
Arshi Chadda, Chief Operating Officer of Sunson Energy, felt that rooftop solar with battery storage would undoubtedly make more sense than using diesel generators during power outages. Also, diesel generators are not allowed in winter in states like Punjab and Haryana because pollution levels shoot up. The C&I tariff is over ₹10 (~$0.13)/kWh across most states. So, rooftop solar with a battery storage facility makes it more competitive as its levelized cost of electricity is around ₹6 (~$0.080)/kWh – ₹7 (~$0.093)/kWh. Using a diesel generator will cost more than twice the C&I tariff at ₹22 (~$0.29)/kWh.
Rooftop solar with a battery facility provides reliable supply, vital for manufacturing facilities to maximize production. Reliability compensates for the high capital expenditure (CAPEX). Chadha said it would also help C&I consumers shift towards renewable energy resources and reduce carbon emissions while keeping production intact.
Daiva Prakash, Senior General Manager (Product Development – New Energy), Amara Raja Group, said that a combination of renewable energy and storage would not only address the intermittency challenge, but the looming coal crisis, round the clock power and polluting diesel generators, by being an alternate source to the main grid.” Daiva Prakash will be sharing his views in detail at Mercom’s webinar ‘Energy Storage – Helping Renewables Become Mainstream Baseload Power’ to held on November 11, 2021.
R. Harinarayan, Managing Director at U-Solar Clean Energy, said, “The solar + storage solution for the C&I segment is a vast untapped market, primarily because there are many evening and night-time loads for the warehouses and industries with very large rooftops that are not completely utilized. However, the key is the storage costs that need to come down further before considering complete off-grid solutions.
“Large scale storage with grid-ties will also create a lot of benefits both to the power consumer (C&I client) and even the grid by balancing out the peak time loads as they could be used from stored solar energy. If we look at it at a national or local grid level, storage will help balance the loads during the peak periods to help the impending coal crisis or increase costs,” he said.
Hitaksh Sachar, Director at Asun Solar Power, had a contrary point of view. He said the CAPEX for rooftop solar with a lithium-ion battery storage solution might not be viable for small and medium enterprises (SME).
SME manufacturing facilities operate for at least 12 to 16 hours a day. Considering that an SME uses a minimum of 100 kW average running load, at least 12 MWh to 16 MWh of battery storage with a solar DC capacity of a minimum of 300 kWp will be required. This would cost nothing less than ₹90,000 (~$1,192)/kWh -100,000 (~$1,325)/kWh, making it highly expensive, even after comparing the cost of running a diesel generator,” he explained.
As for residential consumers, rooftop solar plus battery storage is expensive. However, given that DISCOMs are disallowing net metering and are restricting prosumers from exporting surplus power to the grid, they will be left with no other option but to store excess energy for use during the nights. The government would have to subsidize costs to achieve scale and adaptability, Sachar said.
Vinay Pabba agrees that rooftop solar with a battery storage facility is not available at the right price point to make it an attractive choice for residential consumers. “Subsidized residential tariffs make the CAPEX more difficult to justify from an economic point of view,” he said.
According to Mercom’s India Rooftop Solar Market Report Q2 2021, India installed 521 MW of rooftop solar capacity in the second quarter of 2021. The cumulative rooftop solar capacity stood at 6.1 GW as of June 30, 2021.
Mercom is hosting a webinar, ‘Energy Storage – Helping Renewables Become Mainstream Baseload Power’ on November 11, 2021. The discussion will revolve around the role of energy storage in enabling renewables to become mainstream power. Click here to register for the webinar.