In what could hasten the adoption of renewable energy sources by households, the price of a 1 kW rooftop solar power installation has dropped to just about Rs 22,000 making it far more competitive and affordable than conventional sources of energy, particularly from polluting coal-fired plants.
In the recent tenders floated by the Punjab State Power Corporation Limited (PSPCL), the discovered rate for the installation of these systems (with state government subsidy) has come to about Rs 37,000 ($510)/kWh. With the government providing an additional 40 per cent subsidy for systems up to 3 kW, the price of these installations in Punjab has fallen to Rs 22,000, the cheapest in the country.
According to clean energy communication and consulting firm Mercom, PSPCL has directed vendors to bill the consumers only the remaining amount after deducting the subsidy (central) thereby bringing down the cost for households to its cheapest level on the country.
To make the subsidy scheme work, Punjab has announced subsidies for grid-connected rooftop solar systems ranging between 1 and 10 kW only in the residential sectors. The subsidy is not available for installations in the non-residential sectors like social, government, educational, public sector undertakings, statutory or autonomous bodies, private, commercial, and industrial sectors.
A 1 kW rooftop installation having a battery, inverter and solar panels normally cost around Rs 1 lakh. The installation can last for over 10 years with battery and even more without it.
According to Mercom, while the prices for rooftop after subsidy looked attractive, it remains to be seen how many installers are willing to participate in the programme as in the past, rooftop installers have suffered from some going out of business due to the non-payment by government agencies.
The focus has shifted to the rooftop after several commercial solar power projects are facing issues where states want to renegotiate tariffs midway of a project cycle. This has rendered several bids out projects in operation for the past few months. The government is looking to resolve the issue but in the meantime, the rooftop is being aggressively promoted by the states.