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New Delhi: Comparing your electricity charges with rooftop solar cost
New Delhi: Comparing your electricity charges with rooftop solar cost

By Ankur Jha | Solar Energy in India, Solar Roof Top, Tariff Trends | 0 Comments

Indian Solar Market had earlier done an article on the ‘approval’ of Solar Energy Policy of Delhi.  Even after the approval, the progress on rooftop solar installation in New Delhi is not very impressive. Currently, the installed solar energy capacity in the state is 56 MW of which about 15 MW is rooftop solar. A look at Delhi Solar Policy plans of year wise capacity addition is a proof that New Delhi indeed is lagging on its target.

New Delhi: Comparing your electricity charges with rooftop solar cost
Source: Delhi Solar Policy

It looks like they are going to miss the target for FY 18 as well. Hindustan Times had recently reported about Delhi lagging on its rooftop solar target. The main reason is the lack of awareness among the people about solar energy. To begin with, ISM compares the existing electricity tariffs in New Delhi with the cost of rooftop solar energy. In next article, the team will analyse the feasibility of solar projects that directly influence the decision to use solar power plants.

Electricity cost of New Delhi consumers vis-a-vis cost of rooftop solar plants

ISM lists the energy charges (inclusive of surcharges & taxes) per unit for each category of consumers. In comparison, the cost of energy from rooftop solar has been assumed to be in the range of Rs.4.5-5.5 per unit. Capital cost between 50,000-70000 per kW. Conservatively capital cost can be even lower than Rs.50,000 per kW! At this point in time, we are not considering any support in the form of subsidy, GBI or A.D benefits. The same will be taken up in the next article.

Tariff of Domestic Consumers vis-a-vis rooftop solar energy cost

Domestic Consumers in New Delhi are of three categories based on their connected load: 0-2 kW; 2-5 kW & above 5 kW. Domestic consumers come under the purview of the telescopic tariff. Therefore their cost of electricity increases with consumption as shown here.

New Delhi: Comparing your electricity charges with rooftop solar cost
Source: DERC Tariff Order; Indian Solar Market Database

Cost of energy from a rooftop solar, on the other hand, is between Rs.4.5-5.5 per unit. Low load domestic consumers generally consume lesser energy & therefore they need smaller plants. Bigger solar plant size has better economics due to lesser cost per kW. Therefore, a rooftop solar is more beneficial for such high-end domestic consumers who are likely to consume maximum solar energy at low cost.

Domestic Consumers can avail 30% capital subsidy on rooftop solar. We repeat, in the above tariff comparison, ISM has not considered the subsidy to make a comparison of the real tariffs which are free of any support from the government.


Tariff of Non-Domestic & Industrial Consumers vis-a-vis rooftop solar energy cost

Non-Domestic Low & High Tension consumers and Small & Large Industrial consumers in comparison to domestic consumers pay higher electricity tariffs. Therefore the resultant savings from the use of rooftop solar power plants are much higher than domestic consumers. Typically these consumers have a load in excess of 50 or 100 kW and they can conveniently reduce their tariffs from around Rs.10 per unit to Rs.5 per unit.

New Delhi: Comparing your electricity charges with rooftop solar cost
Source: DERC Tariff Order; Indian Solar Market Database

The graphs prove that solar energy can reduce the electricity cost of most consumers in New Delhi. Delhi has no dearth of high-rise buildings & therefore there is no dearth of opportunities for rooftop solar business.

Lack of awareness pose as the main reason for a hindered solar potential growth. But, rational reasons also exist. Twenty-five years is really a long time for the investment in rooftop solar. If in this duration more buildings are raised up around the building(s) mounting rooftop solar plants, investor’s investment will be adversely impacted. Therefore, the building by-laws must address this issue as well.

ISM team will very soon come up with another article to understand the feasibility of rooftop solar from investment point of view. You may register yourself on our portal www.indiansolarmarket.com for installation of solar rooftop plant at your premise.

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