Off-grid Rooftop PV – An elegant alternative to the unreliable central

grid

November 6, 2012

Mumbai, India

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Agenda

1. Overview

2. Rooftop PV – hope or hype?

3. Challenges

4. Takeaways

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India – Staring Into Darkness

- Power deficit – more than 9%

- Capacity addition shortfall for 11th Plan Period – 26 GW

- Capacity addition required for -12th plan(2012-17)– 76 GW

- 13th plan (2018-2) – 93 GW

- One nation, on grid – not yet achieved

- Transmission and Distribution osses – 27 % +

- Majority of villages have no access to reliable and quality power

- Net loss of utilities – INR 88,170 Crores(~$17 Billion)

- Power cuts of 50%+

Generation Transmission Distribution

Sources: Planning Commission of India, KPMG

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A window to the future..

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Economic and environmental impact– Grim!!

July 30-31, 2012

The World’s Biggest Blackout happens in India

Affects 620 million people

7

World notices..

Off-grid PV

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The solution ?

Distributed Power Generation

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Why Rooftop PV?

• Reduced reliance on the grid

• Offsetting the usage of diesel generators, leading to lower pollution

• Max power generation at max load(for commercial segment)

• Consumption at the point of generation

• Significantly reduced transmission losses. – The Aggregated Technical and Commercial (ATC) losses in India are expected to be about 32%. – 1 kWh of power lost for every 3 kWh generated, which means 2 kWh of power from rooftop = 3

kWh of kWh from far-off thermal plant

• Operation and Maintenance – Easy and inexpensive

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Off-grid or grid-tied PV?

Parameters Off-grid Grid-tied

Grid connection

Operates independent of the utility power grid

Connected to the utility power grid

Suitability Suitable when utility power is not easily accessible or cannot be installed

Used when selling power to utility or the system smaller than the minimum power load.

Storage required

Yes No

Cost Costlier– due to battery bank Less expensive

Installation Easy to commission Complex – restricted by the utility grid

Monitoring Important, but not critical Requires grid related monitoring, feedback and safety features

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Why off-grid PV?

• No uncertainty about Feed-in-Tariff

• No off-taker risk(PPA risk) – losses of utilities at 88,170 Crores

• No need for net-metering

• System not dependent on the uptime of the grid

• Does not lead to destabilisation of the grid

• Ideal for non-electrified villages

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Agenda

1. Overview

2. Rooftop PV – hope or hype?

3. Challenges

4. Takeaways

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Rooftop PV market – Does it exist?

The Foundation - Demand Potential

Pillar 1

Policy/Regulatory support

Pillar 2

Financial Viability

Pillar 3

Technical Feasibility

Rooftop PV Market

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The Foundation - Rooftop Potential

KPMG’s report – “The Rising Sun – 2012”

Estimate of potential – 4 GW by 2016-17Approach – Demand side economicsGrid parity - 2015-16Favourable trends for rooftop PV- Increase in power tariffs in many states- Transmission and Distribution losses of about 20%, which

can be avoided by rooftop PV- Target achievable subject to creation of enabling

environment by regulators and utilities

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Grid parity for rooftop PV by 2015-16

Assumptionsa. Landed cost for consumer – 5.5 Rs/kWh in 2011-12b. Electricity price increase – 4%-5.5% per annumc. Solar price decline – 5%-7% per annum

Source : KPMG

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An Alternate approach

Factors affecting installation- Affordability- Suitability of rooftop space

Residential Industrial Commercial Institutional Total0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

1.96.7 5.1

0.3

14.1

5.112.5 15.4

1.0

34.1

9.6

20.0

30.8

1.3

61.7

Estimate of potential in 2020

Conservative Scenario Realistic Scenario Optimistic Scenario

Rooftop PV Customer Segment

GW o

f pot

entia

l Ins

talla

tion

Potential for rooftop PV systems – Very high!!

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Pillar 1 - Policy Support(MNRE)

• Capital subsidy : 30% and or Soft loans of 5 %• 90% in Certain states

• Accelerated depreciation• Channel partners for speedy disbursal of subsidies

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Pillar 1 - Policy Support(State Level)

Off-grid

1. Kerala - 10,000 rooftop PV programme- 30% capital subsidy from MNRE- Rs.39,000 per system from Government

of Kerala

2. Tamil Nadu – 5 Lakh green houses

Grid Tied1. Gujarat - Gandinagar rooftop programme

2. Tamil Nadu- Generation based incentive for domestic roof owners

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Pillar 2 - Financial Viability

• Accelerated depreciation benefit – Reduces system cost by another 23%

1 kW SystemWithout Battery(Rs. Lakhs) With Battery(Rs. Lakhs)

Capital Cost 1.25 1.7Capital Subsidy(30%) 0.378 0.51Capital cost after subsidy 0.882 1.19

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Pillar 3 - Technology Feasibility

• PV system for rooftop – well proven

• Grid-interactivity – could be a problem, but not for off-grid projects

• Mounting of PV dependent on load bearing capacity of roof and structural stability

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Rooftop PV market – Potential exists

Demand Potential

Policy/Regulatory

support

Financial Viability

Technical Feasibility

Market Attractiveness

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Agenda

1. Overview

2. Rooftop PV – hope or hype?

3. Challenges

4. Takeaways

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Challenges

• Financial – High upfront cost Rs. 1.5 Lakhs

• Regulatory/policy – delay in subsidy disbursal

• Infrastructural – Availability of roof-space without shadows(caused by trees and adjacent buildings), south facing roofs,

• Structural Constraints – load bearing capacity of roof, uneven roofs – special structures can lead to additional cost

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Possible solutions

• Easier and low cost financing

• Leasing option– Pay as you go model or Build, Own, Operate and

Transfer(BOOT)

• Easier subsidy disbursal

• Use of standardised systems

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Agenda

1. Overview

2. Rooftop PV – hope or hype?

3. Challenges

4. Takeaways

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Summary

• Power crisis set to worsen

• Rooftop PV potential is huge

• Key to growth – Innovative business models

Rooftop PV growth – inevitable

Thank you

Madhavan NampoothiriFounder and Directormadhavan@re-solve.in

www.re-solve.in

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Annexure

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Indicative Cost breakup – Solar PV system

1 kW

1 Module ₹ 60,000

2 Inverters ₹ 25,000

3 Mounting Structure ₹ 10,000

4 Building and Civil works ₹ 10,000

5 Isolation Transformer ₹ 6,000

6 Wires and Electricals ₹ 1,000

7 Engineering & Project Management ₹ 3,000

8 Battery

Total ₹ 1,15,000

9 Contingency ₹ 0.10

Capital Cost ₹ 1,26,500.00

Capital subsidy - 30% ₹ 37,950.00

Landed cost after subsidy ₹ 88,550.00