Solar panels in India

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[NEW DELHI] A leading Indian environmentalist and advisor on climate change has expressed doubts over whether India can fund its ambitious plans for solar power.

Sunita Narain, director of the Delhi-based nongovernmental organisation Centre for Science and Environment, is concerned that India does not have an effective institutional mechanism to achieve its target of increasing solar output.

Last week (3 August), the government unveiled its US$19-billion plan to up annual solar energy production from the current 51 megawatts to 20,000 megawatts by 2020, and 200,000 megawatts by 2050. The project will be partly financed by a US$1-billion government solar fund with solar power companies and state governments expected to contribute.

The plan is the first of eight missions to be unveiled under India's national action plan on climate change. It would result in 20 million Indian households receiving solar power by 2020, and would save 42 million tonnes of carbon dioxide emissions each year up to 2020.

The Indian government also hopes that the project will make the cost of solar power — currently US$400 (18,000 Indian rupees) per megawatt — comparable with coal-based power (currently US$100). But Narain argues that while the Indian government's ambition is healthy, it needs to do its costing more carefully.

"This costing is based on assumptions about global trends of solar power cost and demand and does not take into account uncertainties in global demand," she says.

In India, an increase in the manufacture of solar devices, alongside research and development, is expected to reduce the capital costs of solar power plants from about US$4 million per megawatt in 2008 to around US$1.5 million by 2020. This prediction follows trends seen in the United States where prices fell from US$3.5 million per megawatt in January 2007 to US$1.8 million in July 2009.

But Narain doubts the feasibility of these targets; the Ministry of New and Renewable Energy (MNES) — which prepared the document — has a poor track record in scaling-up programmes, she told SciDev.Net.

An official with MNES, who did not want to be named, conceded that a previous solar power initiative from the Indian government in January 2008 failed to attract any solar power companies. 

The government was guaranteeing to buy their power at a subsidised rate but a top Indian solar firm told SciDev.Net that the policy had too many bottlenecks — such as caps on the amount of power that the government was willing to subsidise — to be viable.