India is an agriculture-based country. The agricultural sector provides a livelihood to over 50% of India’s population. In fact, the sector contributes 18% to the country’s GDP. However, the agricultural sector needs proper irrigation facilities and other amenities to reap proper benefits. The major constraint in this sector is farmers’ dependency on pumps for irrigation. Most of the farmers use pumps some of which are connected to the grid while some pumps run on diesel and other fossil fuels. According to a study conducted by KPMG, this sector consumes almost 20% of the installed power in India.

Another issue in this sector is related to the plight of farmers. Since some of the crops are seasonal, most of the farmers are deprived of regular source of income. Furthermore, farmers are not being able to earn anything from their dry/uncultivated land. Solar energy can be put to good use to address these critical issues of the agriculture sector.

Solar energy is one of the most vital renewable sources of energy that can be utilized for various purposes. Solar energy is widely being adopted in residential, commercial and industrial sectors and it has huge potential to benefit the agriculture sector. So, with an endeavour to offer financial and water security to farmers, the Indian government has launched various schemes to promote the installation of grid-connected solar power plants and solar pumps.

The scheme is divided into three different components – installation of standalone solar pumps, solarisation of grid-connected pumps and commissioning of grid-connected solar power plants. Through this scheme, the government targets to add 25,750 MW of combined solar capacities (all three components) by the year 2022.

Components of the new scheme The scheme has a total of three main components:

Component A – 10,000 MW of Decentralized Ground-Mounted Grid-Connected Renewable Power Plants of 500 kW to 2 MW individual plant size to be commissioned by 2022.

Component B – 17.50 lakh standalone solar powered pumps with capacity up to 7.5 HP to replace diesel-powered agricultural pumps.

Component C – 10 lakh grid-connected agricultural pumps with up to 7.5 HP individual pump capacity to be solarised by 2022.

Read more at: //economictimes.indiatimes.com/articleshow/69523504.cms?from=mdr&utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

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India’s estimated cumulative installed solar capacity reached 30 GW at the end of the first quarter of 2019. However, rooftop installations still only make up 12 per cent of total solar installations which is some thing around 3.5 GW and the country could achieve only 9 per cent of its targeted rooftop capacity addition of 40 GW by 2022 if there would not be aggressive push to the installations.

Despite the hype and incentives, solar installations in the country are slowing down. Though the first quarter of 2019 saw a 4 per cent jump in installations to 1,737 megawatt (MW) but when compared to the 1,638 MW installed in Q4 2018, it was down 49 per cent compared to 3,377 MW added in the first quarter of 2018.

Source:-Business Today (Mercom Report)

Investments in the sector were over $2.8 billion in the first quarter, though 12 per cent lower compared to investments made in the first quarter of 2018. The report notes that while 85 per cent of the installations were large scale, only 15 per cent accounted for rooftop solar. Rooftop installations fell by 33 per cent year-on-year with capacity additions of over 260 MW in the first quarter of 2019, compared to 390 MW in Q1 2018.

According to the Institute of Energy Economics and Financial Analysis (IEEFA), 75 GW of renewable capacity has been installed across India, 28 GW has been auctioned and 37 GW of capacity is under various stages of tendering and bidding with a view to come on stream in the next couple of years.

While elections and inability to get clearance for many projects was an issue, there were many other problems the sector was going through. Availability of credit has been a brewing issue and has impacted the growth momentum of renewable energy in the last six months. Easy availability of credit and reducing the cost of capital will result in speedy implementation of projects and also reduce the cost of construction

In the last five quarters, government agencies such as the Uttar Pradesh New and Renewable Energy Development Agency (UPNEDA), the Grid Corporation of Odisha (GRIDCO), Gujarat Urja Vikas Nigam Limited, and others have cancelled nearly 5 GW of solar auctions, citing the final tariffs were either too high or there was a wide gap between the highest bidder and the rest. Only part of this capacity was re-tendered. Other main factors that affected the capacity addition were land and transmission constraints, a 25 per cent safeguard duty on imports from China and Malaysia and issues in the tender schemes and tax uncertainties.

Despite this, India’s capacity addition is one of the fastest in the world. The global energy demand increased an estimated 2.3 per cent in 2018, and of this, India, China and the United States accounted for almost 70 per cent of this addition, says a REN21 (Renewable Energy Policy Report for the 21st century) report. India ranked fourth globally for non-hydro renewable capacity and overtook Italy to reach fifth in the global rankings for cumulative solar PV capacity.

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20160531_grid

Pre-Independence Era:-

  1. 1879:- First demonstration of an electric light in Calcutta.

  2. 1897:- Kilburn & Co secured the Calcutta electric lighting license as agents of the Indian Electric Co. A month later, the company was renamed the Calcutta Electric Supply Corporation.

  3. 1882:- Mumbai saw electric lighting demonstration for the first time at Crawford Market.

  4. 1887:- Indian Electricity Act 1887 was enacted for the protection of person and property from injury and risks, attendant to the supply and user of electricity for lighting and other purposes.

  5. 1897:- The first hydroelectric installation in India was installed near a tea estate in Darjeeling.

  6. 1903:- Indian Electricity Act 1903 was the first attempt to regulate the electricity sector broadly in the country. But, this act was ambiguous, as it did not recognize bulk sale of electricity and also jurisdictions of local government and Government of India were not clearly demarcated.

  7. 1905:- Bombay Electric Supply & Tramways Company (BEST) set up a generating station in 1905 to provide electricity for the tramway. The first electric street light in Asia was lit in 1905 in Bangalore.

  8. 1910:- Indian Electricity Act 1910 gave the power of licensing to local governments and moreover, issuing of license for bulk supply was introduced.

Post Independence Era:-

  1. 1948:- Electricity Supply Act 1948 was enacted to envisage State Electricity Boards (SEBs) in different states with full powers to control generation, distribution and utilization of electricity within their respective states and also to constitute Central Electricity Authority (CEA).

  2. 1964: – Five Regional Electricity Boards (REBs) were formed by the Government of India with the concurrence of State Governments with a view to ensure integrated grid operation and regional cooperation on power.

  3. 1969:- Rural Electrification Corporation (REC) was established to ensure the availability of electricity for accelerated growth as a remedy to famines of 1960s and also to improve the quality of life for rural and semi-urban population.

  4. 1975: – Creation of Central Generating Companies for development of super thermal power stations at coal pit heads and large hydroelectric stations leading to creation of NTPC, NHPC, & NEEPCO.

  5. 1986:- Power Finance Corporation (PFC) was incorporated as a dedicated financial institution for the power sector.

  6. 1989:- Power Grid Corporation of India Limited (PGCIL) was set up by carving out the transmission assets from various central utilities.

Power Sector Reforms

  1. 1991:- Electricity Supply Act 1948 was amended to pave the way for the formation of private Generating companies. CEA empowered to fix the norms for determining the tariff of all generating companies. RBI allows 100% foreign investment in power sector. Also to establish Regional Load Dispatch Centers (RLDCs). To encourage private investments into generation, several policies were promulgated like:-

  2. A guaranteed 16 percent return on equity with full five years tax holiday.

  3. Debt to equity ratio of 4:1.

  4. Sovereign guarantees and escrow benefits in case SEBs defaulted

  5. 1992 – First Gazette Notifications on the criteria for fixing the tariff for sale of electricity by the Generating companies to SEBs or any other agency.

  6. 1998:- Transmission sector was also opened for private investments subject to approval of PGCIL as Central Transmission Utility (CTU).

  7. 1998:- Electricity Regulatory Commission Act enacted paving the way for the formation of Central Electricity Regulatory Commission (CERC) and State Electricity Regulatory Commissions (SERC). Regulatory power of the State governments transferred to SERC. Consequently, Tariff regulatory function of CEA transferred to CERC.

  8. 1999 – Privatization of distribution in Orissa.

  9. 2000 – Indian Electricity Grid Code (IEGC).

  10. 2002 – Privatization of distribution in Delhi.

  11. 2002 – Availability Based Tariff was introduced.

  12. 2003 – Electricity Act 2003 enacted by the Parliament. This Act repeals the Indian Electricity Act 1910, Electricity supply Act 1948, Electricity Regulatory Commission Act 1998. The Salient features of the Electricity Act 2003 are:-

  13. Creates a liberal and transparent framework for the development of power sector.

  14. Facilitates investment by creating competitive environment and reforming distribution sectors.

  15. SEBs has to be unbundled into separate generation, transmission and distribution entities.

  16. Licensing for generation sector is removed, except techno-economic clearance for hydro projects exceeding a capital cost notified by Central Government.

  17. Freedom to have captive and group captive generations.

  18. Establishment of SERCs made mandatory.

  19. Recognizing trading as an independent activity.

  20. Open access in transmission facilitating multi buyer and seller model.

  21. Open access to consumers having demand above one MW within five years from date of enforcement of Electricity (Amendment) Act 2003.

  22. Regulators have been mandated to enforce this.

  23. Envisaging consumer redressal forum and their appellate authority, the Ombudsman.

  24. 100 percent metering made compulsory.

  25. Provisions relating to theft of electricity made very stringent.

  26. For rural and remote areas, stand alone systems for generation and distribution permitted.

  27. 2004:- First Open Access Regulation was published by CERC.

  28. 2006 – Tariff Policy, Competitive bidding for procurement of power, Ultra Mega Power Projects.

  29. 2006:- Staff paper “Developing a common platform for electricity trading” where first time the prospective of Power Exchanges was discussed.

  30. 2007:- Guidelines were issued by CERC for grant of permission for setting up and operation of Power Exchange.

  31. 2008:- IEX commenced its operations in June 2008 and PXIL in Oct 2008.

  32. 2008:- “Open Access in Inter-State Transmission Regulations” which covered Short-term Open Access transactions including collective transaction through Power Exchanges.

  33. 2010:- CERC (Power Market) Regulations introduced with focus on operations of Power Exchanges.

  34. 2010:- CERC (Terms and Conditions for recognition and issuance of Renewable Energy Certificate for Renewable Energy Generation) Regulations.

  35. 2016:- CERC (Terms and Conditions for Dealing in Energy Savings Certificates) Regulations.

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