India solar power 2012
A worker walks through the installed solar modules at the Naini solar power plant in the northern Indian city of Allahabad. Reuters

India is on the brink of becoming a global solar power, according to a report just published by the World Bank. Under the government’s Jawaharlal Nehru National Solar Mission Phase-1 (JNNSM), which was initiated in January 2010 to promote sustainable growth, broadly expand solar power, and deal with the effects of climate change, India’s installed capacity of solar power has already jumped from about 30 megawatts to more than 2,000 MW.

The World Bank noted that JNNSM has also helped bring down the cost of solar power to competitive levels – down to about $0.12 per kilowatt-hour for solar photovoltaic, and to $0.21 per kWh for concentrated solar power, thereby making India one of the world’s lowest-cost destinations for grid-connected solar power. “In a short span of three years, India has made impressive strides in developing its abundant solar power potential,” said Onno Ruhl, World Bank Country Director in India, according to The Hindu newspaper. “With more than 300 million people without access to energy and industry citing energy shortage as key growth barrier in India, solar power has the potential to help the country address the shortage of power for economic growth.”

Indeed, the solar park in Charanka in Gujarat is already the largest such facility in all of Asia. Of equal importance, the bank said, expansion of solar power would reduce India’s over-dependence on imports of coal and diesel for power generation, cut greenhouse gas emissions and also upgrade the nation’s energy security. The bank report also highlighted two special features of India’s solar program – the bundling of solar power with unallocated thermal generation and the introduction of “reverse auctioning.” The “bundling” of solar power with cheaper forms of conventional energy sources had cut solar power tariffs for distribution centers. The “reverse auction” process has allowed qualified bidders to enjoy the benefits of falling global prices of solar components.

But the World Bank cautioned that India faces some challenges in meeting its stated target of adding 20,000 MW of solar capacity by 2022, noting that New Delhi “needs to address the key barriers and constraints that could come in the way of scaling up the solar program.” Ashish Khanna, an energy specialist and an author of the study, noted that “building on the success of Phase 1 [JNNSM], the program now needs to focus on promoting financing of solar projects by commercial banks, developing shared infrastructure facilities such as solar parks and identifying comparative advantage of Indian manufacturing across the supply chain.” The bank suggested that India develop and finance public infrastructure enterprises like solar parks in order to further cut costs and boost efficiencies.

Coincident with the release of the World Bank report, the Indian government said it will construct 60 “solar cities” across the vast country. The minister of new and renewable energy, Farooq Abdullah, said approval in principle has been reached with 55 cities, of which 45 have already been sanctioned. "Out of these 45 cities the master plans have been finalized for 36 cities," Abdullah said.

Among the many solar projects proliferating across the width and breadth of India, a Singaporean firm, Third Wave Power, which manufactures solar chargers, is expecting huge demand for its services in rural, undeveloped India. "We expect demand for portable solar [chargers] to reach a high of 40 million units in the next five years in rural India, including small towns," Third Wave's chief executive officer V.S. Hariharan said, according to Press Trust of India.

Hariharan said the market for its portable solar chargers probably would come from areas that are located far from the main electricity grids as well as from regions that suffer chronic shortages of electricity. Indeed, market surveys suggest that as many as 80,000 villages in India have no electricity. "We can charge these solar panels anywhere in the sun and then use it to recharge mobile phones and other light-power consuming instruments," Hariharan told PTI.