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Survey Says: Solar Power Has Bright Future in India

The Indian power industry continues to struggle to meet power generation goals, and conventional sources, especially coal, cannot keep up with the country’s ever-increasing demand. As a result, interest has shifted to renewable sources of energy. Underpinning the importance of non-conventional sources, in a recent survey of businesses and residential consumers, nearly half of those polled said that solar power can bring a bright future.

Conducted by Mercom Communications India, a wholly-owned subsidiary of Mercom Capital Group, llc, a global communications and consulting firm, the “India Consumer Perceptions on Renewable Energy Survey” focused on gauging awareness and attitudes of consumers and businesses toward renewable energy in India. More than 1,700 residential, commercial and industrial customers were involved in the study.

According to 49 percent of commercial and 45 percent of residential respondents, it is “very important” for India to develop and use solar power. India suffers from acute power shortages, exacerbated by an inconsistent coal supply. Though solar had the strongest positive perception compared to conventional energy and other renewable energy, Mercom believes that a strong industry-driven campaign to educate and inform consumers is needed to help consumers understand that solar is key to solving power woes, and to convert more public opinion from “somewhat important” to “very important” when it comes to developing solar in India.

When asked about their impression of solar energy, 58 percent of both commercial and residential survey respondents said they strongly favor solar. Despite the higher favor respondents gave solar relative to other generation sources, throughout our survey we found a general lack of education and awareness, and in some instances misconceptions about solar, such as its use being limited to water heating.

This may be because the solar industry has done very little to inform and educate consumers about its potential and versatility. The solar industry will need stronger support from consumers to pressure policy makers on subsidies, supporting policies, land use and other incentives because solar is still a nascent industry in India.

When asked about the advantages of using solar energy, 71 percent of commercial and 65 percent of residential respondents indicated the environment is the top benefit. A “never ending renewable source of energy” was the second most cited benefit by 61 percent of commercial and 55 percent of residential respondents, followed by “solar being a domestic source of energy” (57 percent of commercial and 49 percent of residential respondents).

In a surprising finding, when asked how willing survey respondents would be to paying more for solar power, 82 percent of both commercial and residential respondents said they were either somewhat likely or highly likely to pay more for solar power. Eighteen percent of both commercial and residential respondents said they were either somewhat unlikely or highly unlikely to pay more for solar power. This is a significant percentage of consumers saying they would be willing to pay more for solar, and demonstrates that there may be a significant untapped opportunity to sell solar power to consumers who would voluntarily pay more for its benefits.

A good model of premium pricing programs for renewable energy is Austin Energy, the eighth largest publicly-owned electric utility in the United States, serving more than 1 million residents. Its “GreenChoice” program is designed for commercial and residential customers who voluntarily elect to pay a little more (its latest offering was about $0.02 per kilowatt hour above the regular rate for residential customers) to receive 100 percent renewable power.

Customers choosing this option are locked into a set price for up to three years and will not experience any other rate increases. Commercial consumers who participate in the 3-year program are recognized for their support of environmentally friendly energy sources – a way to help companies enhance their brand image as stewards of the environment. However, businesses also often subscribe to GreenChoice for economic reasons, as a hedge against fuel price volatility.

Sales through the GreenChoice program totaled almost 750,000,000 kilowatt hours in 2012. This is just one example and a model to explore for Indian utilities that badly need cash. It is a way to market clean power and raise additional revenue for solar expenditures while providing an opportunity for businesses to improve their brand.

Survey respondents supported subsidies for solar power over other sources, with 87 percent of both commercial and residential respondents. 

The equalizing issue, however, was reliability. With constant power shortage issues, consumers want power from any source, even coal. Consumer awareness of the harmful effects of coal needs to be explored.

A slightly higher number of respondents, 59 percent of commercial and 52 percent of residential, said more solar power will have a very helpful effect on India’s power shortage. When asked about government subsidies, solar power was most popular among survey respondents with 87 percent of both commercial and residential respondents. With nuclear energy subsidies, 44 percent of commercial and 34 percent of residential respondents had no opinion, while 34 percent of commercial and 37 percent of residential consumers said they did not support them.

We at Mercom have always been of the opinion that policies are effective if they are implemented from the bottom-up with stakeholder buy-in. When it comes to power, most of the Indian population has a stake. However, most of the current policies have been developed from the top down with no input from end users.

Though solar was the most recognized energy source, favorability numbers were not as high as they should be. Coal, on the other hand, had a high percentage of neutral and no opinions. Generally, we found a lot of opportunities for the renewable energy industry to invest in educating and informing consumers and differentiating renewables from fossil fuels in a country that is hungry for power of any kind.

The survey spanned a wide demographic and geographic range, covering both urban and rural neighborhoods in Gujarat, Maharashtra and Karnataka. The questionnaire was conducted in person in both residential and commercial areas. Responses were collected from people of different age groups, socioeconomic backgrounds, education, professions and income brackets.

Surveyors questioned households, commercial establishments and industrial sites in an attempt to find out people’s perception of renewable energy, and if they think embracing clean energy could help improve their power situation.

Click here for a copy of the survey: India Consumer Perceptions on Renewable Energy Survey 

Lead image: India art via Shutterstock

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Raj Prabhu is CEO and Co-Founder of Mercom Capital Group, llc, a clean energy communications and consulting firm with offices in the United States and India. Mercom consults its clients on market entry, strategy, policy, due-diligence and joint ve...

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