India to Boost Support for Solar Power

By SUNIL RAGHU
NEW DELHI -- India aims to install 20 million square meters of solar thermal panels and 20 million solar-powered lights as part of a plan to add 20 gigawatt of solar-based power generation capacity by 2022, the country's renewable energy minister said Monday.
"We propose to provide up to 90% support for setting up solar power plants," Farooq Abdullah said at the launch of the National Solar Mission.
"In many other solar applications, where the initial cost is still very high, we're considering proposals for providing up to a 30% grant in aid," he said.
Currently, about 10% of India's total installed generation capacity of 155.859 gigawatt is renewable-sources based. India plans to increase its renewable energy generation capacity in order to reduce its heavy dependence on coal and cut emissions.
Mr. Abdullah later told reporters that within next three years India plans to add 1,300 MW solar power, out of which 1,100 MW will be grid-connected and 200 MW will be off-grid.
"This is our first benchmark," he said. "If we achieve this, achieving the remaining target would not be impossible."
State-run power producer NTPC Ltd.'s power trading arm, NTPC Vidyut Vyapar Nigam Ltd., will purchase solar power at the rate fixed by power tariff regulator Central Electricity Regulatory Commission for the first three years, Abdullah said. He didn't say how much of the solar power generated will be purchased by NTPC unit.
NTPC's unit will bundle four units of thermal power with each unit of solar power to bring down the cost of power to around 5 rupees per unit or 5.5 rupees per unit. One unit is equal to one kilowatt hour.
The Central Electricity Regulatory Commission in September said power produced by solar photovoltaic plants could have a tariff of 18.80 rupees ($0.4) per kilowatt hour. The power produced by coal-fired plants located at the pit head site costs around 1.70 rupees per kilowatt hour while imported coal-based power costs up to 2.60 rupees per kilowatt hour.
Earlier Monday, in his speech on the launch of the National Solar Mission, India's Prime Minister Manmohan Singh said that the solar mission was "no doubt ambitious, but doable."
"In the mean time we may need to explore hybrid solutions combining solar power generation with gas, biomass or even coal-based power," he said.
Write to Sunil Raghu at Sunil.Raghu@dowjones.com