Rajasthan woos big investment in solar power sector

Rajasthan has registered a new proposal of setting up 49,000 MW of new solar power projects. Out of this 49,000 MW, the state government’s Board of Investment has approved customized package worth 34,200 MW of solar power, Chief minister Ashok Gehlot has said.

“The state is becoming a big hub of renewable energy and by the year 2024-25, Rajasthan will be attaining the target of 30,000 MW of solar energy and 7500 MW of wind and hybrid energy. The desert will bloom with green energy with a projection of producing 2.7 lakh MW of solar and wind energy in the future,” Gehlot said addressing a meeting of the Rajasthan Solar Energy Corporation.

Gehlot said that a very large land parcel of the desert is being offered to the investors. The land allotment is done at affordable rates and the solar power producers are being given a 10-year holiday on electricity duty. Efforts have been made to attract investments in solar component manufacturing by giving them exemption on stamp duty on purchased land. The state government would give up to 90 percent subsidy on GST for the solar component manufacturing units.

The agricultural land which would be used for setting up solar power or wind energy production will not have to pay any land conversion fees. The state government has also given the freedom to buy huge land parcels without any ceiling limit. Thus a solar power producer would now be able to buy unlimited acres of land for future development. Currently 1.25 lakh hectares of land in Jodhpur, Jaisalmer and Bikaner are available.

Gehlot said the state government has given customized packages to the big players who are coming with large-scale investments. This would attract investments worth Rs 1.5 lakh crores.

He said the state was the first to announce a plan to help the farmers utilize their land for solar power production under the Kusum Pariyojana. He urged the Centre to be liberal by allowing the financial agencies to offer loan facilities to the farmers at low-interest rates and without any compulsion of co-lateral security.

A recent report by the Institute for Energy Economics and Financial Analysis (IEEFA) forecasts that Rajasthan could add 22.6 GW of renewable energy to the grid by the end of FY2029-30. This will consist of 18 GW of new solar capacity, of which 3 GW is forecast to be distributed solar capacity (rooftop PV and solar irrigation pumps). Rajasthan homes will be powered by solar energy produced on the rooftops.

The state’s installed renewable energy capacity reached 9.6 GW at the end of FY 2019-20. This included 5.2 GW of solar. Also, during FY2019-20, it added more solar power capacity (1.7 GW) than any other Indian state—ahead of Karnataka (1.4 GW), the state with the highest installed solar capacity, and Tamil Nadu (1.3 GW).

The Thar desert spread in 77,000 square kilometre, which was once a curse and unfit for human habitation, is now being used not only for solar energy but also with variants of renewable energy. Thar desert is the most promising solar hotspot in India.

Interestingly, Rajasthan receives solar radiation of 6.0–7.0 kWh/m2. As the area has low rainfall, about 325 days have good sunshine in a year, and in western areas in Thar desert it may extend up to 345–355 days. With its abundance of sunlight, Rajasthan has tremendous potential to emerge as one of the leaders in solar power generation.

The Centre’s Jawaharlal Nehru National Solar Mission (JNNSM) has set a target of 20 GW of solar installations by 2022. Rajasthan alone will contribute to achieving half the target.

State Energy minister, B D Kalla said that Rajasthan has entered an MoU with the Powergrid Corporation to set up power grids to evacuate produced solar power.

Kashish Shah, a research analyst at IEEFA said that high solar radiation and wind speed, and an abundance of barren land make Rajasthan suitable for utility-scale solar parks. And it is already home to the world’s largest solar park – the 2.25 GW Bhadla Solar Park, located in Jodhpur district.

“These factors make Rajasthan an attractive destination for domestic and foreign investors looking for opportunities in renewable energy, electricity grid infrastructure and associated manufacturing,” said Shah.

IEEFA forecasts that the composition of the State’s electricity sector will shift dramatically, with renewables forming 74 percent of capacity and 63 percent of total generation by FY 2029-30.