A suppressed Rooftop Solar demand set to rise again in Gujarat

Posted on Posted in Knowledge Center

In an amendment of the Gujarat Solar Net Metering Policy (refer), there seems to be some good news. One of the reasons why Rooftop Solar Projects had slowed in the recent past in Gujarat can be attributed to the limit put by GERC earlier on ‘what capacity’ solar plant can be installed which was only 50% of the sanctioned load (refer).

gujarat
However, in the amendment, the limit has been altogether removed. But, this has been done only for the Residential Customer. The capacity limit of 50% remains for all other segments for the ‘Initial 2 years’. This would probably mean, the capacity maybe increased after 2 years or operation. This regulation is unique to Gujarat and may have a lesser thought of implication which is that in two years, AD maybe completely phased out hence, allowing the government not to lose out on tax collection by too much. This is considering that most Commercial Establishments use Installation of Solar Power also as a tax saving tool.

 

Looking at some facts

Total installed capacity of solar in Gujarat: 1159 MW (refer)

Target for 2022: 8020 MW (refer)

Growth Required ~ 50% every year

Demand for electricity in the year 2015-16: 10544 Million Units (refer)

 

How much of this can come from Residential Plants?

Number of households in Gujarat~ 12 million (refer)

Percentage of urban households ~ 42% (refer)

Urban Households ~ 5.04 million

Let’s say only 50%, can be considered for installing rooftop solar systems ~ 2.5 million

Now, even if we consider a conservative 2 kW is installed on each of house.

Total potential comes out to be ~ 5000 MW

A whopping 72% of the remaining target can be fulfilled by Residential Rooftop Solar Projects itself! This is still a conservative estimate and we think that with the removal of the limit on the size of the installed solar power plant, the potential may be way more than 5000 MW, making Gujarat again an attractive state for installation of Solar Plants, however, CAPEX ones.
By disallowing RESCO projects (although SECI tender calls for bids for it and GEDA does not allow it (refer)), Gujarat would function as a good example to understand Sales of Solar Plants as a pure play retail product.

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