How India Goes Solar Could Change the World

Indian Prime Minister Narendra Modi’s proposals for a draft National Renewable Energy Act raising renewable deployment to 175 GW by 2022, with 100 GW of solar has grabbed headlines worldwide.

After all, given its rapid growth, sizzling heat and dependence on coal, India’s energy problem is an increasing threat to the global climate for everyone. Modi’s dazzling 100 GW solar target is on exactly the kind of grand scale the world needs.

But why should we take this new goal seriously? After all, India’s first outrageously ambitious goal announced in the lead-up to the Copenhagen climate talks in 2009 targeted 20 GW of solar by 2020.  With just five years left till that deadline, only one fifth of the goal – four gigawatts – is installed.

With that disappointing result, this year’s five-times-bigger solar goal for two years later may seem just more of the same headline-grabbing talk in the lead-up to another important climate talk in Paris at the end of this year. Both of the other biggest polluters – China and the U.S. – have raised the ante in those talks, with ambitious and yet actually achievable goals.

The Big Money

Here is the game changing difference: The biggest obstacle to reaching the original 20 GW target was financing. India’s Copenhagen goal had been thwarted by the country’s extremely conservative financial sector, which balked at the unknown, unable to commit to financing renewable energy.

This year, Modi has taken a more solutions-oriented approach. By openly calling on international financial interests this year to intervene, Modi is actively seeking outside investors to meet India’s latest ambitious solar goal.

Modi asked companies from Germany, China, Japan and the U.S. to lead the needed investment of $100 billion to boost India’s solar energy capacity to 100 GW.

Foreign banks responded, tripling that figure. At the RE-Invest 2015 summit in India, almost 300 global companies committed to invest over $300 billion over the next decade – enough to generate nearly 300 GW of solar, wind, biomass and mini-hydro, and more than enough to meet the total renewable target of 175 GW by 2022.

Japan’s SoftBank Corporation, together with Bharti Enterprises and Taiwan’s Foxconn, led the way with a commitment to invest the first $20 billion.

The huge move by SoftBank unleashed a gold rush. Foreign investment commitments poured in. China’s Trina Solar is investing $500 million in solar panel manufacturing. SunEdison is investing $15 billion by 2022.

With the world’s financial backing, the 100 GW solar target is achievable.

A Distributed Energy Revolution

Modi would like to electrify almost half a billion homes by 2022 with solar. More than half of India’s 1 billion people have no electricity.

When the U.S. brought electric power from sea to shining sea it was with centralized coal power stations on a massive distribution grid crisscrossing the continent with the transmission and railroad system to move that coal power.

Bringing electricity to those now without power in India will be quite different.

Almost half of India’s 100 GW of solar will be distributed solar on rooftops, bypassing the country’s piecemeal transmission system altogether.

This radical change will come to a nation that is now 60% dependent on coal. India’s total installed capacity, serving only half its demand, is around 232 GW. Large hydro plants supply 40 GW – of a 150 GW potential – nuclear supplies 5 GW and 29 GW comes from renewables, mostly wind. Solar will go from the current 1 percent to 20 percent of the new grid.

A New Energy Paradigm

Why is Modi focusing half the solar target on rooftops? Because distributed solar can bypass the logistical problems of securing land, getting off takers to buy the power to send to customers, and big transmission investment.

The revolutionary aspect of a $50 billion focus on rooftop PV in a developing nation is historic. Developers will be able to sell directly to private companies; competing with the retail cost of power.

Last year Power Minister Piyush Goyal estimated the cost of India’s needed transmission alone at $250 billion.

These issues will have to be resolved in the new market, from difficulties in buying land and fixing the considerable transmission problems to the risk of solar panel thefts. Many small state utilities struggle to supply affordable power, so they are reluctant to buy renewables at twice the cost of coal.

In part, Modi’s mandates will take care of bringing that cost down, as it has in other markets, by simply getting more renewables online, driving cost reductions by learning-by-doing.

And infrastructure investment is an opportunity for clean energy growth. The U.S. did not transition from wood-fired cottages to coal-powered cities without massive investment in transmission and the railroads needed to move all that coal around. Imagine if clean energy was an option when the U.S. was a developing nation.

And there are advantages. Construction costs for solar are half those of Japan.

“Twice the sunshine, half the cost, that means four times the efficiency,” Softbank CEO Masayoshi Son told reporters in a conference.

The imagination and vision of clean energy financiers globally could possibly topple a looming climate threat.


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Susan Kraemer reports on renewable energy for CSP Today, Wind Energy Update, PV Insider and Renewable Energy World, and has written about renewables for Cleantechnica, Green Prophet and other sites.

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