Grid Parity of Residential Building Rooftop Solar PV in India

Abstract

Rooftop solar photovoltaic(PV) installation in India have increased in last decade because of the flat 40 percent subsidy extended for rooftop solar PV systems (3 kWp and below) by the Indian government under the solar rooftop scheme. From the residential building owner's perspective, solar PV is competitive when it can produce electricity at a cost less than or equal grid electricity price, a condition referred as “grid parity”. For assessing grid parity of 3 kWp and 2 kWp residential solar PV system, 15 states capital and 19 major cities were considered  for the RET screen simulation by using solar isolation, utility grid tariff, system cost and other economic parameters. 3 kWp and 2 kWp rooftop solar PV with and without subsidy scenarios were considered for simulation using RETscreen software. We estimate that without subsidy no state could achieve grid parity for 2kWp rooftop solar PV plant. However with 3 kWp rooftop solar PV plant only 5 states could achieve grid parity without subsidy and with government subsidy number of states increased to 7, yet wide spread parity for residential rooftop solar PV is still not achieved. We find that high installation costs, subsidized utility grid supply to low energy consumer and financing rates are major barriers to grid parity.