Union government is working on a “rent a roof” policy to support its plan to generate 40 GW of solar power by 2022.
What is “rent a roof” policy?
Under the policy, a developer will take rooftops on rent and will offer lease to each household, and then feed the solar power to the grid.
This policy works under net-metering system, by which a consumer is only billed for the electricity consumed after deducting the power generated from one’s solar rooftop panels that is supplied to the grid.
Union government aims to give the discoms financial incentives for every MW of rooftop capacity created in their area of operation.
However, to avail themselves of incentives, discoms should create the capacities through tariff-based competitive bidding.
The proposed scheme seeks to shift the game from captive players to energy companies (independent power producers, or IPPs).
What are the hurdles?
Most of the discoms in India are State government-owned and are hesitant to take up such projects due to of their nature of self-protection from instant financial turmoil.
These companies have refused to buy any surplus power from them.
Therefore, factories and commercial establishments, like shopping malls, put up only as much rooftop solar capacity as would satisfy their demand, even if they have the space and wherewithal for more.
As for individuals, rooftop solar has are not being attractive proposition as there is no clear government policy stand on installation and maintenance of roof top solar plants.
There is also absence of policy direction on ‘net metering’, which would allow owners of captive rooftop plants to sell surplus power to the grid.
In a tariff-based competitive bidding scenario, individual and small producers will be at a disadvantage.
Competitive bidding process would also culminate in a power purchase agreement and a PPA is not particularly appropriate for a sell-only-surplus situation.
