Go solar to reduce power bills in long run

Harnessing the sun’s energy is fast emerging as an environment-friendly renewable alternative to both diesel and petrol generators.

Electricity consumption has been taking a large bite of household budgets by a higher and higher degree with every passing year on account of increase in electricity tariffs, and greater consumption due to weather extremes resulting in hotter summers and colder winters. Financial Chronicle explores the potential of renewable energy source of solar in managing the rising costs.

Indian households basically depend upon grid power for energy requirements. But barring two states, all the other states in the country are power deficit. Power outages are a common phenomenon these days and as summer peaks the situation worsens, forcing consumers to look for options to either store or generate power.

The power situation is different in different states. Only Himachal Pradesh and Odisha had surplus power in 2013. Tripura had the highest deficit of 33 per cent and Delhi lowest of 0.3 per cent, as per the data of Central Electricity Authority. In terms of power tariffs too, the states have different rates. Maharashtra has the highest power tariff of Rs 8.80 per unit and Chattisgarh has the lowest of Rs 2.20 per unit.

Among the options available to tackle power outages, inverters are widely bought these days to store grid power. Inverters work only in cases where grid power is available at least intermittently to recharge the batteries.

A 1 kilowatt (kw) inverter with battery can cost Rs 25,000 to Rs 30,000 initially. The batteries may have to be replaced after the warranty period of two to three years. The recurring cost of battery replacement can range from Rs 10,000 to Rs 15,000.

However, in places where there are long hours of outages and grid power is insufficient to recharge inverters, one will have to go for means to generate power. Generators powered by diesel and petrol are usually used as back-up units. Solar power is fast emerging as an environment-friendly renewable energy source as both diesel and petrol generators cause air and noise pollution, depleting the fossil fuel resources.

“Among solar power solutions, there are options for both rural and urban customers. There are solar power lanterns with starting price of Rs 2,000 for remote un-electrified villages. For urban and semi-urban households there are both on-grid and off-grid solar solutions,” said Ashish Sethi, vice-president, solar projects, Su-Kam.

Usually households need one to 5 kw solar systems depending upon the usage and the rooftop area available for power harvesting. Household electrical gadgets other than air conditioner can be run on a 1 kw system, while 3- kw solar kit will provide sufficient power for ACs as well for six to seven hours a day.

On-grid solutions do not have attached batteries and the power is connected to the grid lines or to the inverters. They will run for around 20 years without much maintenance costs. In case of off-grid solutions, batteries are needed to store the power. Almost 25 per cent of the cost will be that of the batteries.

A 1 kw on-grid solar system costs around Rs 1.2 lakh whereas a similar off-grid system costs Rs 1.6 to Rs 1.8 lakh. In case of 5-kw system, the cost can go up to Rs 5 lakh for on-grid and Rs 7.5 lakh for off-grid. Apart from this one-time cost, there is recurring cost on batteries which may have to be replaced in three to five years, depending upon the usage.

The solar panels that harvest 1 kw power will occupy 10 sqm of roof-top area. Solar systems can also generate power during winter as the new photovoltaic technology in panels work in diffused light as well, though not to their full capacity.

The central government offers 30 per cent subsidy on the solar systems and select states like Tamil Nadu, Kerala and Chhattisgarh offer an additional subsidy of around 20 per cent on 1 kw systems. “However since 2013, the central subsidy has not been released,” said Sethi.

Solar system is best suited for individual houses with open terrace. In housing societies, a solar unit of 5-7 kw can be used to light the common areas and operate all the common facilities like elevators. However, supplying power to individual apartments is not viable under current conditions.

“If a 30-flat apartment complex has to be supplied solar power, a 40 kw system has to be installed and it will occupy 400 sqm area on the roof-top. Checks also have to be placed to ensure that the power is consumed equally by each apartment. So, housing societies do not look at the solar option to provide power to all the apartments,” he said. Development of more efficient solar panels that can harvest more quantum of power may solve the problem in the future.

Apartment complexes largely use generators to produce power. The capital expense of a diesel generator can be 20 per cent lower than that of a solar system. But the operational expenses are high in generators and the costs also go up with the fuel price hikes.

“At the current rate, the power produced by a diesel generator can cost Rs 17 or Rs 18 per unit, while the price of solar power initially will be Rs 10 per unit. After the pay-back period, the cost will come down to Rs 1.5 in case of off-grid system and less than Re one in case of on-grid kit,” said Sethi.

According to him, the payback period of a solar system is three to four years.