Solar Ambition Calls for Urban Rooftop Revolution

Shankkar Aiyar
5 min readJan 28, 2024

300 Days of sunshine. Potential of rooftop: 637GW. Only 11GW harnessed. The solar power narrative is riveted around megawatt ambitions, while the potential rooftop solar to catalyse a kWh revolution is left lagging. Energy security calls for a reset of incentives and a recasting of mindset and landscape.

Shankkar Aiyar | The Third Eye | Published: 28 Jan 2024

Every data point is screaming for it. India imports over 86 percent of its crude oil requirement. Coal accounts for nearly half of India’s generation capacity, and India must produce more coal to fire coal-powered plants to keep its economy chugging. Air pollution is claiming lives, and residents in cities are gasping for breath. India is expected to account for 25 percent of global energy demand over the next two decades. The case for a solar revolution is manifest in the data.

Image for representation | Generated with AI

Much of India’s Geography enjoys 300 days of sunshine every year. On the face of it, the country has ramped up solar power generation to over 70 GW, is ranked fourth globally, is home to some of the largest solar parks in the world, and has a target of generating 280 GW by 2030. Beyond the marquee milestones, the gap between potential and performance is wide. At 70 GW, India has harnessed only a tenth of the 748 GW potential assessed by the National Institute of Solar Energy.

Transitions call for mass persuasion. The solar power narrative is riveted around megawatt ambitions, while the potential of rooftop solar — the KWHr revolution — is left lagging. The Council on Energy, Environment, and Water estimates that India has an opportunity to generate around 637 GW from rooftop solar. A 2015 KPMG report places residential rooftop resource potential at 1,240 GW. There are estimates, and then there is the saga of missed targets.

In 2015, the government set a target of 40 GW by 2022 for rooftop solar. At the end of 2023, rooftop solar accounted for just over 11 GW. The geography of the rollout — the traction is limited to four states — illustrates the sloth in the system at the state level. The pandemic did disrupt the rollout, but that alone is not the cause of what the Parliamentary Standing Committee in 2023 described as a “tardy pace of progress.”

Serendipitously, attention is back on rooftop solar. This week, Prime Minister Narendra Modi announced the Pradhan Mantri Suryodaya Yojana (PMSY), promising the installation of rooftop solar systems in 10 million homes. The announcement of PMSY will hopefully propel capacity in photovoltaic cells and a reduction in costs. More importantly, it is an opportunity to review policy design to expand it beyond the 10 million households.

The scale of the opportunity is striking. India’s population is around 1.4 billion — effectively, at 5 persons per family, that is 280 million households. CEA data shows India’s households consume around 3,30,809 GWh of electricity. At a granular level, the average per capita consumption is 1,255 kWh; the more urban the habitat, the higher the consumption. Given the pace of urbanisation, usage of devices, e-mobility, and digitalisation, consumption and demand will only spiral higher.

Urban India accounts for over a third of the population and is home to 53 cities with million-plus people and 4,000 towns. Any blueprint for energy resilience calls for mandating rooftop solar for existing and new buildings. Countries in Europe have mandated a renewable energy component for new and existing buildings by 2028. Using the Real Estate (Regulation and Development) Act and municipal laws, the government can mandate rooftop solar for new residential and commercial complexes.

The expansion of rooftop solar, though, depends on redesign of policy. There is no mistaking the pull factor of cost-efficient, consistent, and cleaner energy — to lower costs, reduce disruptions, and rid polluting generators. However, the push for transformation is haunted by issues of supply chain, quality, regulatory muddle, built-in inequities in tariffs, and fuzzy policy.

The average cost of a 3-kw rooftop system, including installation, hovers at around Rs 3 lakh and qualifies for a subsidy of 40 percent. Housing societies seeking higher capacity pay more and get lower subsidies. The net-metering formula reflects a pro-discom bias.

Incredibly, in a hearing before the Maharashtra Electricity Regulatory Commission, the state’s electricity distribution company argued that rooftop solar panels “are installed by the consumers for their self-use and therefore export of surplus units may not be encouraged.” What is worse is that the interest rate on loans for rooftop solar is over 10 percent.

In sharp contrast, residents in the European Union can avail of subsidies of €900/kw, zero-interest loan of up to €25,000 spread over 10 years. The Inflation Reduction Act in the US similarly offers homes and businesses rebates, tax credits, and low-cost finance.

Process is critical for progress. Government templates present the process as a series of easy steps, but fail to define deadlines. Those opting for rooftop solar find that while physical deployment takes less than 10 days, the approval process — beset with all the ills of inspector raj from delays to corruption — can take as long as three months.

The key to success lies in fostering an ecosystem to enable a hybrid paradigm. The induction of Aadhaar brought down costs of equipment such as scanners and QR code readers, and its adoption was accelerated by public-private partnerships. The use of LED bulbs was similarly propelled with subsidies and rules. The expansion of digital payments on national payment platforms such as UPI was catalysed by solutions built on the open platform by entrepreneurs.

Ensuring India’s energy security requires an expedited integration of renewable energy sources. This calls for a realignment of incentives and a recasting of mindset and landscape.

Shankkar Aiyar, political economy analyst, is author of ‘Accidental India’, ‘Aadhaar: A Biometric History of India’s 12-Digit Revolution’ and ‘The Gated Republic –India’s Public Policy Failures and Private Solutions’.

You can email him at shankkar.aiyar@gmail.com and follow him on Twitter @ShankkarAiyar. This column was first published here. His previous columns can be found here

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Shankkar Aiyar

Journalist-Analyst. Author of ‘Accidental India, ‘Áadhaar: A Biometric History’ and ‘The Gated Republic’. Studying how politics rules the economics of people!