How sunlight can transform our lives

How sunlight can transform our lives

For years, people spoke of the abundant sunlight in India and the potential to produce solar power. KPMG, a global consulting firm, announced on Monday that the cost of producing solar power per unit (kW) in India is now lower than the 80% power produced in India by burning coal.

Solar power could now cost Rs 4.63 per unit against close to Rs 5 per unit of thermal power of a coal-based plant. This price is based on the record low bid won by US-based SunEdison’s for a contract to sell 500 megawatts of solar energy in Andhra Pradesh.

What this means:

Solar energy will scale up significantly, reaching a 12.5% market penetration by 2025. This sends out hints that solar energy will likely be a major source of energy in the next few years. It will surely have an impact on the coal price, cell efficiency and resource consumption patterns of India. In simple terms, we will have sunlight powering our homes.

Push back from coal:

The coal sector will definitely fall under immense pressure due to the reduction in solar energy prices. There could be a complete change in the consumption pattern of solar energy in India in the next few years.  Around 45 to 50gigawatts of solar power will be installed. This means the coal consumption will be reduced to 7% in the power sector of India. In order to cope up with the challenging situation, the quality, efficiency and flexibility of coal need to be taken care of.  

Upgraded technology:

Presently, India has over 20 million pump sets that are inefficient and receive a high government subsidy. However, the use of upgraded solar power pump sets will boost 1,50,000 agricultural connections by 2020 and 3,00,000 connections by 2025, KPMG report states.  Lower solar energy costs could reduce the subsidy burden of the government and offer better day power to farmers soon.  In short, the total number of solar-powered pump sets will shoot up to 3.8million in 2025.

A clean form of energy in India:

Reduction in coal consumption will preserve the forest environment and create a direct-to-home power consumption pattern via solar rooftop energy storage in rural areas. India’s energy self-reliance will efficiently boost the manufacturing of electric vehicles eventually.

Cell efficiency and demand for solar inverters:

There has been a satisfactory improvement in the efficiency of solar cells by 0.5%. Prices of solar inverters will also reduce along with lower solar energy prices. Advanced semiconductors and better circuit design could be the two major factors for solar inverters to get cheaper.

Usage of new cell printing technologies such as micro-inverters will surely increase the power output of solar panels.  The solar energy sector may soon use organic materials and film technology that can reduce the manufacturing costs of such panels.

Solar House:

The ‘Solar House’ concept is a household condition when the entire power needs are fulfilled by rooftops, energy storage and on-site solar powers. In fact, India has the largest amount of rooftop resources that can efficiently meet the household energy requirements in a sustainable and economic manner, as per the KPMG report. Solar rooftop consumption will largely be consumed by the residential, industrial and commercial sectors. In fact, the rooftop adoption rate by households will likely increase up to 3.5%, which means its potential will shoot up to 2GW by 2020.

Happy Investing

Source:Yahoofinance.com