India solar energyOne of the most fundamental shifts in human demographics is taking place within our lifetime. United Nations predicts that after many centuries, China will cease to be the most populous country on Earth. By 2030, India's population is expected to surpass China and reach 1.45 billion. Naturally, this blistering rate of increase in population is severely testing India's power grid where black-outs are quite common and about 700 million people have limited access to the grid. Hungry for power, households are exploring alternative means to have access to reliable and affordable electricity. In many cases, households in India are opting for solar energy to fill the void in electricity supply.

There are three key reasons for the surging popularity of solar energy in India:

Solar is decentralized

Just like mobile phones, solar energy has the distinct advantage of being compatible with a distributed network. Instead of the traditional "hub and spoke" architecture of large power generators connected to a very large number of recipients, power is generated where it is needed the most: at the source of demand. Thus, solar energy infrastructure can be rolled out much more quickly than traditional power grids.

Solar is scalable

You can use a single solar cell to power an LED light, or you can use a million of them to build a solar power plant. In either case, the building blocks of the solar energy system are the same. This is another distinct advantage for solar energy. Although there are small scale wind turbines and geothermal energy systems, no other energy source has the level of flexibility solar energy has for residential applications.

Solar is affordable

Scalability has a very useful second-order effect: even households with very limited budgets can afford small-scale, starter investments and enjoy the benefits of solar energy. For many households in India, LED lights and mobile devices are the top of the list of devices to power. A new generation of companies are installing solar panels in villages and selling the power to the households in bundles (a common bundle is seven hours of lighting per day and a phone charger). Using a "micropower" business model, some companies, such as OMC Power, managed to bring the price point of solar to the same level as traditional fuels such as kerosene and diesel.

India's Solar Energy Potential

India is very favorably positioned when it comes to solar radiation potential. Large swathes of the country, including major urban centers, receive abundant amounts of solar radiation. For example, New Delhi has a Solar Score of 80 and Bangalore has one of 79. At this level of solar resource, even a modest 1 kW system (consisting of about four solar panels) could produce around 2000 kWh of electricity per year, more than enough to power LED lights, mobile phones, and small home appliances.

The government is also motivated to facilitate the growth of the solar energy market. In 2009, the government of India unveiled a target of 20 gigawatts of solar power by 2020.  To make sense of this ambitious target, consider that 20 GW of installed solar power is equivalent to about 4-5 nuclear power plants (taking into account the relatively low capacity factor of solar energy). Fueled by the desire of the middle class households to increase their quality of life, the Indian solar energy market is poised for very significant growth in the coming years.

Sources:

The Economist, Lighting Rural India: Out of the Gloom, July 20th, 2013

United Nations, World Population Prospects, 2013 http://esa.un.org/wpp/Documentation/pdf/WPP2012_Press_Release.pdf

Image credit: United States Department of Commerce