CHAPTER IV EQUIPMENTS RELATED TO SOLAR ENERGY 4.1 Sun 4.2 Solar energy options 4.3 Advantages of solar energy 4.4 Disadvantages of solar energy 4.5 Solar energy: A SWOT analysis 4.6 Distribution of solar energy in India 4.7 Equipments related to solar energy 4.7.1 Thermal route 4.7.1.1 Solar water heating 4.7.1.2 Solar cooker 4.7.1.3 Solar desalination system 4.7.1.4 The solar dryer 4.7.1.5 Solar space heating systems 4.7.1.6 Solar refrigeration 4.7.1.7 Solar thermal power generation 4.7.2 Photovoltaic route 4.7.2.1 Solar lantern 4.7.2.2 Solar home light system 4.7.2.3. Solar Street light 4.7.2.4 Solar photovoltaic pump 4.7.2.5 Solar mobile charger 4.7.2.6 Solar cap 4.7.2.7 Solar power generation 4.8 Government support to solar equipments promotion 4.8.1 Solar energy potential and prospects 4.8.2 Government support to utilize the solar energy by following means. 4.8.2.1 Emergence of Ministry of New and Renewable Energy (MNRE) 4.8.2.2 Role of MNRE 4.8.3 Support by other institutions to MNRE 4.8.3.1 Indian Renewable Energy Development Agency (IREDA) 4.8.3.2 Maharashtra Energy Development Agency (MEDA) : 4.8.4 Government schemes to promote solar equipments 4.9 Role of bank in promoting solar equipments 4.10 Role of suppliers in promoting solar equipments
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CHAPTER IV EQUIPMENTS RELATED TO SOLAR ENERGY
4.1 Sun 4.2 Solar energy options 4.3 Advantages of solar energy 4.4 Disadvantages of solar energy 4.5 Solar energy: A SWOT analysis 4.6 Distribution of solar energy in India 4.7 Equipments related to solar energy
4.7.1 Thermal route 4.7.1.1 Solar water heating 4.7.1.2 Solar cooker 4.7.1.3 Solar desalination system 4.7.1.4 The solar dryer 4.7.1.5 Solar space heating systems 4.7.1.6 Solar refrigeration 4.7.1.7 Solar thermal power generation
4.7.2 Photovoltaic route 4.7.2.1 Solar lantern 4.7.2.2 Solar home light system 4.7.2.3. Solar Street light 4.7.2.4 Solar photovoltaic pump 4.7.2.5 Solar mobile charger 4.7.2.6 Solar cap 4.7.2.7 Solar power generation
4.8 Government support to solar equipments promotion 4.8.1 Solar energy potential and prospects
4.8.2 Government support to utilize the solar energy by following means.
4.8.2.1 Emergence of Ministry of New and Renewable Energy (MNRE)
4.8.2.2 Role of MNRE 4.8.3 Support by other institutions to MNRE
4.8.3.1 Indian Renewable Energy Development Agency (IREDA)
4.8.3.2 Maharashtra Energy Development Agency (MEDA) : 4.8.4 Government schemes to promote solar equipments
4.9 Role of bank in promoting solar equipments 4.10 Role of suppliers in promoting solar equipments
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EQUIPMENTS RELATED TO SOLAR ENERGY
4.1 Sun:
Sun is the source of our all sorts of energy and remains as principal
deity since human thinking began. In Hindu scriptures we began with ‘Ekam,
Adityam’, which means only one is Aditya. That means Aditya or sun was only
god when the civilization begun. Therefore, sun remains as the principal deity
right from the beginning and even today. A Hindu begins his ritual with surya
namaskar.
Before we invented fire, sun was the only source of energy using the
sun rays for drying or for other purposes.
Sun is the core of solar system around him all the planets move. In
other words, unless the contradicted the planets were born out of sun and
therefore for all practical purposes are son of sun. therefore, sun remains as
our father figure and as we give respect to our ancestors, we give our respect
to our father sun.
4.2 Solar energy options:
Energy is very critical to all development aimed at human welfare
covering household, agriculture, transport and industrial sectors. There is also
a direct correlation between the level of economic development and energy
consumption. Countries all over the world have now begun to think about a
policy on energy and look into the possibility of having energy systems with no
or very limited environmental impacts. They now draw plants to use non-
renewable sources on a sustainable basis as also replace them with
renewable sources. It may be emphasized that most renewable sources of
energy are environmentally rather sound and could especially help to meet
decentralized rural energy requirements. This itself could stall environmental
degradation by fuel substitution, greater efficiency in energy production and
use improvement and identification of alternative sources.
The commercial energy consumption in the developed countries has
increased during the last 3-4 decades. More than 80% of total world which
account for only 30% of the population on the other hand 20% of the energy is
consumed by 70% of the world population in developing and socialist
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countries. Further more there had been a major shift from coal to oil on
account of the increased availability as also many technological advances in
the area of oil. The very high consumption of energy in advanced countries is
due to the ready access to energy for the daily life of the peoples, heating,
cooking, lighting, domestic work etc. In the developing countries the energy
(particularly commercial) consumption is concentrated in the urban areas for
industrial, commercial and even domestic use. The non-commercial energy is
typically concentrated in rural area through the use of firewood, agricultural
residues, animal manure and human and animal power.
The economic history provides a powerful study of arguments for solar
energy. Two major energy transitions have swept the world in the last 125
years. First, coal replaced the wood as the dominant source of commercial
energy. Coal itself was displaced by oil and gas. Both these changeovers
occurred with breath taking speed. The figure above shows the way we
change over quickly to easy access for the energy.
Solar energy now makes economic sense at the margin which means
that the energy from a unsubsidized new nuclear power plant (if there were
such a thing) would cost more than that from an unsubsidized new solar
energy. If the society’s scare capital is to be invested efficiently, the
microeconomic interest of individual consumers must be brought more closely
in line with the macroeconomic interest of the nation. Only through federal
policy can such an alignment come about. The energy system of our country
is complicated. A historical force of in its own right its many threads are woven
into the fabric of our lives. Moreover, an enormous amount of capital has been
invested in equipment designed to use or produce fuels that are becoming
increasingly expensive. Therefore, shifting to an economy fueled by
renewable resources require taking action of many kinds of many fronts.
Nothing less than a major technological revolution will be necessary outling
the several steps towards this goal all Indians support makes more sense
than attempting to chart the entire journey. Since some new opportunities will
arise technological breakthrough or holdups will change priorities and human
wisdom will find new paths, the key is to design policies that maximize our
opportunities for future flexibility.
The programme we envision is both more modest and more
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manageable than the moral equivalent of war. It is a practical plan for
correcting the distortions in the energy market place by reconstructing the
subsidies regulations and other public policies that bias the market in favour
of the development and production of conventional fuels. Huge uncertainties
impede public and official understanding of the impact of policies to promote
solar development.
Most of the principal tools of policy analysis reflect the assumption that
life will not change dramatically in the foreseeable future with a patency false
assumption as applied to energy policy.
Some uncertainly systems from the longstanding neglect of solar
technologies by policy markets. In like of data on likely impacts of such
policies, and yet must now rely almost solely on judgement. Whether the
result are dressed in computer language or dashed off on the backs of
envelopes.
4.3 Advantages of solar energy:
1) Solar energy is free though there is a cost in the building of collectors
and other equipments required to convert solar energy into electricity or
hot water.
2) Solar energy does not cause pollution. However, solar collectors and
other associated equipments/ machines are manufactured in factories
that in turn cause some pollution.
3) Solar energy can be used in remote areas where it is too expensive to
extend the electricity power grid.
4) Many everyday items such as calculators and other low power
consuming devices can be powered by solar energy effectively.
5) It is estimated that the worlds oil reserves will last for 30 to 40 years.
On the other hand solar energy is infinite. (forever)
4.4 Disadvantages of solar energy:
1) Solar energy can only be harnessed when it is daytime and sunny.
2) Solar collectors, panels and cells are relatively expensive to
manufacture although prices are falling rapidly.
3) Solar power stations can be built but they do not match the power
output of similar sized conventional power stations. They are also very
expensive.
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4) Unreliable climate means that solar energy is also unreliable as a
source of energy. Cloudy skies reduce its effectiveness.
5) Large areas of land are required to capture the sun energy. Collectors
are usually arranged together especially when electricity is to be
produced and used in the location.
6) Solar power is used to charge batteries so that solar powered devices
can be used at night. However the batteries are large and heavy and
need storage space. They also need replacing form time to time
4.5 Solar energy: A SWOT analysis:
We analyze strength, weakness, opportunity and threat for any
concept of process we propose. In this case also SWOT analysis is necessary
so that the analysis shall be considered right at planning stage for ultimate
success. SWOT analysis of solar energy is given below.
Strength:
1) Source of energy is never ending.
2) Totally pollution free.
3) Can be utilized for all purpose.
4) Can be utilized in any form of energy.
5) Scope for decentralization.
6) Easy to operate.
7) Minimum working expenditure.
8) Saves fossil fuel deposit.
9) Economically self sufficient.
10) Less hazardous.
Weakness:
1) Problem of storage.
2) Not available in cloudy or eclipse days.
3) Quantum varies according to season or weather.
4) Initial investment is high.
5) Needs subsidy.
6) Spares not available.
7) Creates problem for urban planning since higher buildings interrupt
lower solar system.
8) Not yet taken on priority list.
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Opportunity:
1) Scope for utilizing magnetic energy from solar wind.
2) By bringing down the price, it can be boon even for low income group.
3) Chance of hazards is less.
4) Scope for decentralization.
5) Chance of adverting exploitation of energy consumers.
6) Totally pollution free.
7) Vast opportunity for expansion in many use.
Threat:
1) Threat from oil lobby.
2) Threat from coal lobby
3) Opposition from different forces due to subsidy.
4) Lack of knowledge of common consumers.
5) Fluctuation due to season or weather may discourage consumers.
4.6 Distribution of solar energy in India:
A comprehensive survey by Mani (1981), shows that every hour 3000
to 3200 hours of bright sunshine is available in Rajasthan, Gujarat, Western
Madhya Pradesh and Northern Maharashtra and 2800-2600 hours in the rest
of the country except Kerala, Kashmir and Assam. In Gujarat, Rajasthan
region more than 2000 KWh/M2 area receives global solar radiation while
Bengal, Assam and eastern Bihar receives less than 1700 kWh/M2. During
winter (December to February) the duration of sunshine is more than 280-300
hours/month in the central parts of the country including Rajasthan, Gujarat,
Maharashtra, Andhra Pradesh and northern Karanataka. The lowest values of
200 hours/month are recorded in Kashmir, along the Himalayan foothills and
north eastern Assam. In summer (May-June) the duration of sunshine
exceeds 300-320 hours/month over the region extending from Punjab to
northern Bihar and northern Maharashtra, while the southern peninsula,
Kashmir and Assam have less than 220 hours of sunshine per month. During
this period in Rajasthan and adjoining Gujarat, the global solar radiation is of
the order of 220 KWh/m2/month, while over Assam and Kerala between 180-
190KWh/m2/month. (Mani 1981)
With the onset of the monsoon, there is a significant decrease in the
duration of sunshine over the whole country, except for Kashmir. The west
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coast of Peninsula. India, southern MP and northern and eastern Maharashtra
has about 100 hours of sunshine per month, while nearly half of the country
comprising the peninsula and north-eastern India receives a little more or less
than 150 hours monthly sunshine-Rajasthan 180-200 hours, Assam and
Surashtra 140 hours, Tamilnadu 170 hours. In autumn the duration of
sunshine increases to 280-300 hours month in Rajasthan and Assam and less
than 200 hours/ month in eastern Peninsula India.
4.7 Equipments related to solar energy:
In the day of energy crisis where fossil fuel becoming scare day by day
due to limited stock we shall have to depend on renewable energy more and
more in future. There are several types of renewable energy but solar energy
remain as one of the principal renewable energy which can be utilized very
effectively and perhaps this is one of the most efficient type of energy
provided. We can store it for use any time we are in need. Solar energy an be
harnessed to useful purpose by two types a) thermal route b) photovoltaic
route.
4.7.1 Thermal route:
Thermal technology for harnessing solar energy for thermal energy
(heat). Solar thermal collectors are defined by the USA Energy Information
Administration as a Low, medium or high temperature collectors. Low
temperature collectors are flat plates generally used to heat swimming pools.
Medium temperature collectors are also usually flat plates but are used for
creating hot water for residential and commercial use. High temperature
collectors concentrate sunlight using mirrors or lenses and are generally used
for electric power production.
Major thermal route products such as:
4.7.1.1 Solar water heating:
Solar water heaters currently available the economic and
environmental benefits of owing a system. This could be helpful in selecting a
system for your home or industry.
Solar water heaters are cost competitive in many applications when
you account for the total energy costs over the life of the system. Although the
initial cost of solar water heater is higher than that of conventional water
heaters, the fuel (sunshine) is free plus, they are environmentally friendly. To
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take advantage of these heaters, you must have an unshaded south facing
location (a roof, for example) on your property.
These systems use the sun to heat either water or a heat transfer fluid,
such as a water glycol antifreeze mixture, in collectors generally mounted on
a roof. The heated water is then stored in a tank similar to a conventional gas
or electric pump to circulate the fluid through the collectors.
Solar water heaters can operate in any climate. Performance varies
depending in part on how much solar energy is available at the site, but also
on how could the water coming into the system is. The older the water heater
more efficiently the system operates. In almost all climates, you will need a
conventional backup system. In fact, many building codes require you to have
a conventional water heater as the backup.
Solar water heaters benefits:
There are many benefits to owing a solar water heater, and number
one is economics. Solar water heater economics compare quite favorably with
those of electric water heaters, while the economics aren’t quite so attractive
when compared with those of gas water heaters. Heating water with the sun
also means long term benefits, such as being cushioned form future fuel
storages and price increases and environmental benefits.
1) Economic benefits:
Solar water heaters offer the largest potential saving compared to
electric heating, with solar water heater owners saving as much as 50% to
85% annually on their utility bills over the cost of electric water heating.
However at the current low prices of natural gas, solar water
heaters can’t compete with natural gas water heater in most parts of the
country except in new home construction. Although you will still save
energy costs with a solar water heaters because you won’t be buying
natural gas it won’t be economical.
Paybacks vary widely, but you can expect a simple payback of 3 to
8 years on a well designed and properly installed solar water heater.
(Simple payback is the length of time required to recover your investment
through reduced or avoided energy costs). You can except shorter
paybacks in areas with higher energy costs. After the payback period, you
acquire the savings over the life of the system, which ranges from 15 to 40
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years, depending on the system and how will it is maintained.
2) Tax incentives and rebets:
In India some states offers subsidies on domestic as well as
commercial solar water heating systems installations. Government of India
offers 100% depreciation claim in the first year itself on installation of
commercial solar water heating system.
3) Long term benefits:
Solar water heaters offer long term benefits that go beyond simple
economics. In addition to having free hot water after the system has paid
for itself in reduced utility bills, you and your family will be cushioned from
future fuel shortages and price increases. You will also be doing your part
to reduce this country’s dependence on foreign oil. The national
remodelers association reports that addition a solar water heater to an
existing home raises the resale value of the home by the entire cost of the
system. You may be able to recop your entire investment when you sell
your home.
4) Environmental benefits:
Solar water heaters do not pollute. By investing in one, you will be
avoiding carbon dioxide, nitrogen oxides, sulfur dioxide, and the other
pollution and wastes created when your utility generates power or you
burn fuel to heat your household water. When a solar water heater
replaces an electric water heater, the electricity displaced over 20
years represents more than 50 tons of avoided carbon dioxide
emission alone. Carbon dioxide traps heat in the upper atmosphere,
thus contributing to the “greenhouse effect”.
Application of solar water heating systems:
Heating water is one of the best known application of solar energy.
Domestic solar water heating is quite popular and is preferred over
electric water heating by many a home owner.
However business applications conventional heating systems based on
electricity / coal / furnace oil/ wood still rule the roost. Inspite of massive
subsidies in the past not many industries opted for solar water heating
systems. Only recently with the tremendous increases in cost of electricity and
conventional fuels are industrialists turning to solar energy as a means to
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meet their hot water needs.
Industries that can benefit from application of solar energy to heat
water are –
Hotels:
Bathing, kitchen, washing, laundry applications.
Dairies:
Ghee (clarified butter) production, cleaning and sterilizing,
pasteurization.
Textiles:
Processing bleaching, boiling, printing, dyeing, curing, ageing and
(vi) SPV Power Packs: Support would be provided for installation of SPV
power packs of upto 1 kWp capacity in commercial establishments in urban
areas.
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(vii) Stand-alone SPV Power Plants (SPPs): Support would be provided for
installation of Stand-alone SPV power plants of capacities between 1 and 10
kWp (without distribution network) and above 10 kWp (with distribution
network) for meeting electrical energy needs of a small communities in village/
urban, islands and other areas. However, in special cases, SPV power plants
of capacities less than 1kWp will also be supported on case-to-case basis.
(viii) Other Applications: Other emerging applications and new applications
of SPV technology and specific joint projects with other
Ministries/Departments, autonomous Government bodies and other
organizations will be supported on case-to-case basis. The Ministry
depending upon their utility will also support SPV systems for community use.
The Ministry will also support deployment of SPV systems in areas affected
by natural calamities.
SPV Rooftop Systems for Diesel saving in Urban Area s: Rooftop solar
photovoltaic systems (with or without grid interaction) will be supported for
installation in industrial and commercial establishments/ complexes (exc
luding manufac turer s of SPV cell s/ modules), housing complexes,
institutions and others which face electricity shortages and are using diesel
generators for backup power.
Central Financial Assistance for SPV rooftop Systems (with or without
grid interaction) will be limited to 100 kWp capacity. Minimum capacity of
installation will be 25 kWp. In special cases, smaller capacity systems, not
less than 10 kWp, could be considered for financial support from the Ministry.
Beneficiaries will exclude manufacturers of SPV cells/modules. Maximum
system capacity for sanction of CFA will be linked to the capacity of the
existing diesel sets installed by the beneficiary entity. An entity seeking CFA
for a particular kWp SPV system must have a DG set of at least that capacity
installed in its premises. The beneficiaries, in association with concerned
State Nodal Agency and the manufacturer/ supplier selected by the
beneficiaries on competitive basis (technical and financial), will formulate
proposals for installation of the systems and submit the same to MNRE in the
prescribed format through the State Nodal Agency. Commitment for meeting
the balance system cost by the beneficiary would be necessary while
submitting the proposal. In specific cases the proposals could be submitted
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through other Govt. Departments/ technicalorganizations.
4. Physical Targets and Budget Provisions:
The following indicative targets have been set for 2009-10 and rest of
the 11th plan period. These targets could be enhanced subject to availability
of funds.
Table 4.2 Targets and budget
Source: www.mnre.nic.in
Implementation Agencies:
The scheme will be implemented through various implementing
agencies which would include interalia Central and State Government
Ministries and Departments and their organisations, State Nodal Agencies,
Local bodies, PSUs, Educational /Technical Institutions/ Organizations, Indian
Renewable Energy Development Agency (IREDA), Financial Institutions (FIs)
and Non-Banking Financial Companies (NBFCs), Self Help Groups (SHG),
and reputed Non-Governmental Organisations (NGOs). In addition, State
Governments and MNRE could also designate agencies for implementation.
Implementing agencies will ensure that there is no duplication of funding for
same activity in areas covered under the RVE programme of the Ministry.
Specifications of SPV Systems:
The minimal technical specifications of SPV home lighting systems,
street lighting systems and stand alone SPV power plants among others, to
be supported under the programme are available on the Ministry’s web site
www.mnre.nic.in under the heading “SPECIFICATIONS FOR SOLAR
PHOTOVOLTAIC SYSTEMS” . The SPV modules to be deployed under the
Programme should conform to the relevant IEC Standards. Balance of
systems/ components including batteries, cables, switches, circuit breakers,
control electronics,LEDS, CFLs, etc. and system installations should conform
166
to the relevant national and international standards, codes and practices.
Central Financial Assistance:
Central Financial Assistance (CFA) in form of capital subsidy will be
available from the Ministry for installation of the SPV systems.
Implementing agencies may pool funds and resources from other
Government Programmes and other resources. Central Financial Assistance
will not be provided to manufacturers of SPV cell/ modules or systems for
installing the systems in their premises/ complexes. The pattern of Central
Financial Assistance for the systems is given below:
Table 4.3 Pattern of central financial assistance
CFA Aggregate systems capacity
NE Region and Special category
states
Other States/ UTs
SPV Home lighting systems 4500 (18Wp) 8660 (37-74Wp)
2500 (18Wp) 4800 (37-74Wp)
SPV Street Lighting systems 17300 (74Wp) 9600 (74Wp) Stand alone SPV power plants • More than 1 KWp (with capacity
less than 1 KWp on case to case basis)
• More than 10 KWp with distribution line
Rs.225/Wp
Rs.270/Wp
Rs.125/Wp
Rs.150/Wp
SPV traffic lights - Up to 100 Wp module capacity SPV Blinkers Soalr powr packs Up to 1 KWp Solar illuminating hoardings / Bill boards – up to 1 KWp modules capacity
Rs.150/Wp for systems with battery bank of 6 hrs/Rs.115/Wp without battery bank for organisations not availing accelerated depreciation
Rs.100/Wp for systems with battery
bank of 6 hrs/Rs.75/Wp without battery bank for organisations availing
accelerated depreciation. Other systems for community use in urban and industrial areas
SPV Roof-top systems in Urban areas -From 10KW to 100KW
Rs.75/Wp, limited to 30% of the cost of systems to profit making bodies availing depreciation benefits Rs.100/Wp, limited to 40% of the cost of systems to non-profit making bodies
Source: www.mnre.nic.in
Other and New Applications
Ministry could consider extending Central Financial Assistance (CFA)
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in project mode on new and innovative applications of SPV Systems. The
Ministry will provide full CFA for undertaking pilot and demonstration projects
through manufacturers and other organizations for new and innovative
applications of SPV systems for low power consumption loads. All such
projects will be sanctioned with the concurrence of IFD and approval of the
competent authority.
Table 4.4 Service Charges to SNAs/ Implementing Age ncy
Source: www.mnre.nic.in
Interest Subsidy Scheme
The Ministry also proposes to enter into Memorandums of
Understanding (MOUs) with Indian Renewable Energy Development Agency
(IREDA) and interested banks to operationalize the interest subsidy scheme
introduced during 2002-03 for financing the purchase of solar photovoltaic
systems by various categories of users. However, Indian Renewable Energy
Development Agency (IREDA) will work out detailed modalities of the
Scheme.
Support to Implementing Agencies for Promotional Ac tivities:
The Ministry will provide Central Financial Assistance to the
Implementing Agencies for the following promotional activities:
Seminars/ workshops/ symposia/ training : Support upto a maximum
of Rs. 2 lakhs per event will be provided to State Nodal Agencies/ Municipal
Corporations/ 6 Technical institutions for organizing seminars/ workshops/
symposia/ training to create awareness and training etc. on installation of the
systems in urban areas.
Publicity & Awareness: Financial support upto a maximum of Rs. 5
lakhs will be provided for information and publicity using all possible avenues
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such as print, electronic (audio and visual) media to State Nodal
Agencies/Municipal Corporations/Associations of solar photovoltaic systems/
devices for community/ institutional use in urban areas.
Eligible SPV systems suppliers:
Manufacturers of SPV cells, modules and systems and their suppliers,
whose modules and products conform to relevant national/ international
Standards would be eligible. Technical performance of modules/ systems
should be duly supported by valid test certificates issued by the Solar Energy
Centre or by other authorized / accredited national or international test
centres.
Procurement of SPV systems:
State nodal agencies, autonomous institutions, public sector
undertakings, state government and central government organizations will
follow the laid down procurement procedures of the Government of India or
State Government or respective organizations for purchasing and installing
the SPV systems and devices. Other eligible entities can procure the systems
directly from manufacturers/ suppliers of SPV modules and systems following
their procurement procedures and associating the state nodal agencies for
necessary technical help and guidance, if required. However, in such cases
central financial assistance will be routed through respective implementing
agencies only.
Warranty:
The manufacturers must provide a warranty for a minimum period of
two years for the complete SPV system (including the battery) and minimum
ten years for the PV module(s) from the date of supply.
Comprehensive Maintenance Contracts
Implementing agencies should enter into a Comprehensive
Maintenance Contract (CMC) for the SPV systems ordered, atleast for a
period of three years after the expiry of the warranty period. The scope of the
CMC should cover supply of spares/ parts and services during its tenure. The
CMC should be a separate transaction and not necessarily part of the order.
The cost of the CMC should not be included in the cost of the systems for the
purpose of computing and claiming subsidy.
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Record of Beneficiaries
State nodal agencies/other implementing agencies shall keep a record
of the beneficiaries of SPV systems and devices deployed in their State. A
suggested format for keeping the beneficiary-wise record of SPV systems
supplied under the Programme of 2009-10. Implementing Agencies shall
submit the Project Completion Report to MNRE.
Release of Central Financial Assistance (CFA)
Release of Central Financial Assistance will be as follows:
• 50% of the CFA will be released in advance to State Nodal
Agencies/Implementing Agencies along with the sanction of project.
• The balance 50% of the CFA along with service charges will be released on
installation and commissioning of the systems and receipt of Utilization
Certificate of the advance amount given and project completion report.
For SPV Rooftop systems , 50% of the CFA will be released in
advance to SNAs along with the sanction, for onward release to beneficiaries
immediately after supply of equipment at site. The balance 50% CFA will be
released upon installation and commissioning of the systems and satisfactory
performance report thereof from the beneficiary
The grantee institution/implementing agency shall be required to
maintain subsidiary accounts of the Govt. grants received and furnish a set of
audited statement of accounts after utilization of the grants-in-aid or whenever
called for.
Submission of proposals
The state nodal/ implementing agencies will submit proposals in project
mode, i.e., for focused deployment of SPV systems in villages, towns, cities,
islands and other areas for maximum impact. Individuals/Local
bodies/Industry interested in these systems could approach state nodal
agencies to include their requirement in respective state projects.
Monitoring & Reporting Mechanisms
The Implementing Agencies will closely monitor the implementation of
the projects undertaken by them under the scheme to ensure their speedy
completion and avoiding time and cost over-runs. Implementing Agencies are
required to make suitable arrangements to monitor the supply, installation and
performance of the systems. MNRE could also get the monitoring done
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through a third party, whenever considered necessary.
Expenditure
An expenditure of Rs. 375.00 crore is expected to be incurred under
the Programme during FY 2009-10 and the remaining period of 11th Plan, as
per the year-wise phasing given below:-
Table 4.5 Budgeted expenditure
Source: www.mnre.nic.in
The involved expenditure will be met from the following budget head
allocated for the programme in the Demands-for-Grants of the Ministry for
FY2009-10.
Table 4.6(a) Demands for grants of the ministry for FY2009-10.
Source: www.mnre.nic.in
Table 4.6 (b) Demands for grants of the ministry for FY2009-10.
Source: www.mnre.nic.in
This sanction issues in exercise of delegated powers to this Ministry and with
the concurrence of IFD vide their Dy. No.IFD/543/09 dated 2/7/2009 and
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concurrence dated 2/07/2009.
4. Government Schemes:
On 17th August 2009, Ministry of New and Renewable Energy has
announced incentives to banks/ micro financing institutions to support
installation of solar home lighting and other small solar systems through
loans.
Under this there is sanction of the President for undertaking a
Demonstration Programme on providing incentives to banks /micro financing
institutions to support installation of solar home lighting and other small solar
systems through loans in the country during the 11th Plan period.
Objective
The main objective of the Demonstration Programme is to assist the
banks / micro financing institutions by providing incentive for capacity building
and other specified activities to extend loans to consumers to purchase solar
home lighting and other small solar systems for lighting, powering fans and
small portable TV sets etc, in villages/ areas where the power supply is un-
reliable.
Implementation Arrangements
Any financial institutions/ banks/ NBFCs, micro financing organizations
and SHG federations will be eligible to participate under the demonstration
programme, subject to fulfillment of the guidelines contained in the order. A
proposal may be submitted to the Ministry by a bank which is ready to provide
loans for solar PV systems. The banks are required to inform the Ministry
about their commitment to take up targets in the specified ranges given in this
order. They are also expected to submit their plan to take up other specific
activities for which Ministry may provide funds as per the guidelines given in
the following section of central financial assistance.
Targets and Central Financial Assistance
It is proposed to cover 2,50, 000 solar lighting and other systems under
the programme by 31st March, 2011 The following are the details of the
financial support to the banks/financial institutions to implement the
programme;
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Table 4.7 Financial support to the banks / financia l institutions
Source: www.mnre.nic.in
In addition to above, a provision of Rs.1.50 crore is made for procuring
consultancies for monitoring and evaluation, Cash prizes will be given @
Rs.1.0 lakh each to the concerned bankers and also to the village panchayat
wherein village / villages which are fully solar electrified. In addition, the
village panchayats with 75% and more coverage may also be rewarded on
pro rata basis. The panchayats will be encouraged to utilize this money to
purchase solar streetlights or other solar devices for use of the village
community. In addition, capacity building and awareness generation support
to NGOs and SHG federations who are participating in the initiative along with
the banks would also be given up to Rs 5 lakh per NGO or SHG, depending
on the villages covered by them.
Release of Funds:
(i) It is proposed that the release to the banks and other participating
organizations would be made in two installments of 50% upfront (after
obtaining commitments from the banks) and the remaining 50% on
receiving a certificate from the bank, regarding the number of units which
have been financed and a progress report of the project in MNRE.
(ii) The implementing agencies will submit in duplicate Utilization
Certificate (UC) for the funds released by the Ministry; and certified
Statement of Expenditure (SoE) issued by the concerned Bank.
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(iii) At the time of seeking the final release of CFA, the concerned banks
will submit a detailed annual project completion report and Utilization
Certificate & consolidated Statement of Expenditure for settlement of
accounts.
Monitoring Arrangements
The implementing agencies will devise suitable arrangements for
monitoring and evaluation of solar systems. They may also take other
measures as considered appropriate for monitoring/inspection/ performance
evaluation of solar home lighting and other small solar systems in the field. In
addition, Ministry may commission other organizations/experts to inspect the
systems in the field and undertake performance evaluation study. Funds will
be sanctioned by the Ministry for monitoring of the implementation of the
projects by different implementing agencies through independent
organizations. The banks are required to submit quarterly report on the
progress on implementation.
Necessary funds for implementation of the Demonstration Programme
during 2009-10 will be drawn from the Ministry’s budget head – ‘2810’
Renewable Energy (Major Head),.103-Renewable Energy for Urban,
Industrial and Commercial Application (Minor Head), 01-ST, SPV and other
RE Systems 01.01-Renewable Energy application, 01.01.31-Grants-in-aid,
during the year 2009-10 (Plan).
This sanction issues in exercise of powers delegated to this Ministry
and with the concurrence of IFD dated 12.08.2009 vide their Dy.
No.IFD/800/2009, dated 10.08.2009.
5. Solar water heating scheme
Objective
To promote the widespread use of solar water heaters through a
combination of financial and promotional incentives and other support
measures.
Scheme provisions
Interest subsidy to the users of solar water heaters, incentive to
motivators, support for organizing seminars/ symposia/ workshops/ business
meets/ exhibitions, training programmes, publicity and awareness campaign,
technology up-gradation, and studies/surveys. Support also to
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municipalities/municipal corporations that adopt and notify the modifications
to their building by-laws for making the installation of solar-assisted water
heating systems mandatory in certain categories of buildings.
Table 4.8 Salient features of interest subsidy sche me
Item/activity Incentive/support Soft loans to users @ 2% to domestic, @ 3% to institutional, and @
5% to industrial and commercial users
Loan repayment period Maximum 5 years
Eligible FIs for providing
soft loans
All public/private sector banks, including RBI
approved non-banking financial companies,
scheduled cooperative banks, and other financial
institutions
Payment of interest subsidy
to FIs
On upfront basis for the entire loan re-payment
period after the systems are installed
Incentive to motivators Rs 100 per square metre of collector area
installed through banks/FIs for bringing business.
The motivators could be unemployed youth,
Akshay Urja Shops and state nodal agencies.
Support to state nodal
agencies for monitoring and
data management
Rs 50 per square metre of collector area
visited in their states
Release of interest subsidy
and other incentives
Through IREDA (Indian Renewable Energy
Development Agency) on re-imbursement basis
Service charges to IREDA @ 2% of interest subsidy disbursed to Fls/their
direct users and @1% of loan disbursed to
their intermediaries
Service charges to FIs/
intermediaries of IREDA
@ Rs 200 on each loan disbursed to the users
Support to IREDA for market
development, data
management and feedback
analysis
@ Rs 100 per loan disbursed by FIs/ IREDA
and its intermediaries
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Banks/FIs implementing the interest subsidy scheme (as on 30 November
2007)
11 public/private banks, 10 scheduled cooperative banks and 5
non-banking financing companies and 2 private banks are presently
participating in the scheme. Many others are likely to join.
Supportive measures being taken
Amendment in building by-laws by municipal corporations, rebate in
electricity tariff by SEBs/utilities and in property tax by MCs, extensive
publicity awareness campaign in potential cities, inclusion of system cost
in housing loans by FIs, construction of building/housing complexes
integrated with solar water heating systems.
Manufacturers' network 58 BIS-approved manufacturers for systems
based on flat-plate collector and 35 MNRE approved suppliers for systems based
on evacuated tube collectors.
Cumulative achievements 2.1 million square metre of collector area
4.9 Role of bank in promoting solar equipments:
To get more information about the role of bank in promotion of solar
equipments, researcher discussed with some bank managers using structured
schedule. Inferences of the discussion are as follows:
IREDA is a government company which distributes loans for solar equipments
to the people with the help of nationalized banks. These banks are –
1) Bank of Maharashtra 2) Union Bank of India
3) Vijaya Bank 4) Bank of India
5) Syndicate Bank 6) Canara Bank etc.
These banks work in various parts of India and serve people.
According to the discussion, the researcher found that the banks provide
loans for solar water heaters. Actual rate of interest is 11%. But banks charge
for domestic proposals is only 2% interest, for institutions it is 3% and for
commercial proposals it is 5%. The difference in interest is paid by IREDA to
the concerned banks. Each bank accepts 7 to 8 proposals every month.
Actually process of getting loan is difficult. As they have to send the proposals
to IREDA and maintain the accounts. Banks don’t make special efforts for
creating customers awareness about bank finance. They rely on government
advertisements.
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It is also observed that suppliers supply material of solar equipment is
of inferior quality. So the equipment do not give good service to the customer.
As a result, the customer is not willing to pay the installments.
To claim subsidy from IREDA is a complex process. The branch
submits the proposals to the head office and head office claims the subsidy. It
requires a lot of documentation. Then IREDA gives subsidy to the head office
and it is transferred to the concerned branch. It is really time consuming
process minimum time required for a proposal is around six months, so
subsidy is not claimed in time.
Maximum loan proposals are in the range of Rs.16000 to 30000. So
the installment is small and the customer neglects it. It is not paid in time.
There is no target for any bank for financing solar equipments. So the banks
do not try to make any genuine efforts. Every month around 15 customers
approach banks for such loans. Bank managers feel that these loan proposals
are cumbersome because even small amounts requires more documentation
as compared to big amounts. They neglect these proposals and run after
business proposals.
These bank managers are not satisfied with government role. They
think that the number of documents should be reduced and the procedure
must be simple. They suggest that government should provide subsidy to the
concerned branch directly. This loan process should be made easy.
Suppliers are advised to help the bank to collect the installments. They
should also provide good material and good service to the customer. On the
contrary customers should select qualitative material and care for the same.
They should pay installments from time to time and help the bank.
4.10 Role of suppliers in promoting solar equipment s
To get more information about the role of suppliers and promotion of
solar equipments, the researcher had discussion with some suppliers.
Researcher used structured schedule. After collecting the information from
them, the inferences of the discussion are drawn and present below.
There are 13 suppliers of solar equipments in Satara district. These
suppliers mainly deal in solar water heating system and solar lighting system.
Most of them, concentrate on solar water heaters only. Every month, they sell
5 to 7 solar water heating systems and 2 to 3 solar lighting systems including
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solar lanterns.
In order to promote solar equipments, they do participate in various
exhibitions. They advertise their products in local news papers. They also
offer cash discounts to attract maximum customers. They are not satisfied
with government schemes because the schemes are not implemented
properly by the banks. Government is also not showing interest in creating
awareness among people. Suppliers are not getting support from banks to
promote solar equipments. The banks are passive and disinterested.
High price of the solar equipments is the main hurdle to push the
equipments in the market. Suppliers also think that people don’t believe in
these equipments. They opined that loan process should be made easy and
more people should be motivated to install these equipments to save energy.
There should be subsidy in the prices of the equipments. Customer should be
given concession in electric bills for using solar energy. Government should
create awareness among the people through radio and T.V. media.
Customers are totally satisfied with solar equipments.
The suppliers also suggested that manufacturers should produce
products of low cost and good quality. Manufacturers should provide their
equipments on installment basis. Customers should pay their installments in
time and customers should describe the benefits of solar equipments through
oral publicity. They should believe in the quality and benefits of the
equipments. They think that the awareness is good. Though the people afford
these equipments, they don’t buy them willingly. They don’t know the benefits
of using them. According to suppliers, if compared to the population of Satara
district less than 0.5% people have gone for solar equipments.
The researcher thinks that there is great scope to promote solar
equipments. Banks are not supporting properly. The government failed to
create desire among people. Customers are not convinced about the solar
equipments. Manufacturers don’t show any positive steps to reduce the cost
of the solar equipments. As a result the sale of solar equipments is very less.
So all these elements like the government, the banks, the manufacturers and
suppliers should come together and form a policy to promote solar