3 ½ Reasons Why Solar Makes Sense.

1. The Past: History may not repeat itself!

A lot many times our vision of the future is obstructed by our present!

The unit rate we pay today for our energy consumption to the power distribution companies is a function of multiple components. There is the cost of generation which is directly impacted by the availability of the source of energy, the cost of transmission and distribution (which includes the cost of losses too), profits that the generation companies and the distribution companies need to make, taxes and cess etc.

The Government today absorbs a significant portion of these cost by way of subsidies. This essentially keeps the prices low for you and me the end consumers.

According to a report published by the Power Finance Corporation of India (PFC) last year, the gap between the Average Cost of Supply and the Average Revenue Realization of State Power Utilities is >20%. Even after accounting for the subsidies that the Government provides a gap of >10% remains. The per unit energy rates have seen an escalation of approximately 2-4% per annum as have the costs. The losses of this scale cannot be sustained and subsidies will not be tenable.

Someday not so far away a ton of bricks shall come crashing down. Guess who is going to end up bearing the brunt of all this. Yes, you!! So, if you have a rooftop that is available, going solar now would be a smart move!

2. The Present: Right Now is the Right Time!

As they say, one can never time the market! You cannot aim to buy low and sell high. Fact, prices of solar photovoltaic (PV) panels, a key component of a Solar Power Generation System, have come down to a fraction of what they were a few years ago. However, expecting rather waiting for another price shedding might not be the smartest thing to do. As per reports and articles the most radical part of the drop in prices is perhaps in the past. Going forward, the reduction is expected from the other components of the solution viz. mounting structure, the inverter and labour. In an Indian context though, these were already at a low when the drop in PV panels happened.

Net-net, there just might be no point waiting. Solar Power Generation System (SPGS) is most likely going to be the most significant purchase you ever make for your household. Unlike the LED TV, a Home Theatre or even that extra car you might be contemplating, an SPGS is not an expense, it is an investment in the long term! The sooner you invest, the earlier the pay-back and the higher the returns are likely to be!

So don’t let your roof and money lie idle. Invest now and make energy while the sun shines!

3. The Future: Sunshine is free and forever!

The world population is pegged at ~7BN. Out of this India alone has 1.2BN, a whopping 17% share! The world itself has 200 years’ worth of coal (India has 8.3% of these reserves), 60 years’ worth of Natural Gas (India has 0.7%) and about 45 years’ worth of Oil (India has 0.3%) left in its reserves. With a 2.4% of land share, India already overuses its natural resources by 70% and this number is increasing. With India’s high consumption and low resources what the cost will be for us is anybody’s guess.

On the other hand, India has abundant sunshine. Over 300 sunny days in a year. Considering 6-7 hours every day of sunshine, an area of less than 0.05% of our country comprising areas with good insolation (~5kwh/m2/day) could generate in excess of 140 Gigawatts, almost half the total installed capacity in India.

The icing on the cake is the fact that the resource to generate this power is available in abundance, forever and free!

1/2 It is Green!

Finally, solar makes sense because it is sustainable. The generation itself is sans pollution of any kind! No smoke, no fumes, no residue, no noise!

An economically sound investment into a sustainable, green future. Does solar make sense? You bet!!