Tamil Nadu’s Draft Solar Policy Proposes Tough Measures Against Laggards

The Tamil Nadu Energy Development Agency (TEDA) has issued the Draft for its Solar Energy Policy for the current year. The southern state which has an installed capacity of 2.2 GW and ranks amongst the top five Indian states for solar installations, aims to establish an ecosystem that translates the country’s solar energy vision into enabling policy systems and processes and create a single window system for technical support, funding support, and project clearance through its solar policy. The policy also seems broadly in consonance with the draft national policy.

The key highlights from the draft policy are:

• Tamil Nadu aims to have an installed solar energy generation capacity of 8,884 MW by 2022. Of this target, 40 percent is expected to be met by consumer scale solar energy generators.
• If a distribution company (DISCOM) fails to comply with RPO (renewable Purchase Obligation) mandates, penalties specified by Tamil Nadu Electricity Regulatory Commission (TNERC) for non‐compliance will be strictly enforced.
• Solar energy will be exempted from electricity tax, grid connectivity, open access, wheeling, and banking and cross-subsidy charges.
• Solar energy gross and net feed-in tariffs will be determined by TNERC taking into consideration different capital costs-based on the solar system capacity. A dedicated solar energy storage feed-in tariff will be determined by TNERC. This tariff will be designed to incentivize solar energy export to the grid at peak demand hours.
• All public buildings will be mandated to meet 30 percent of their energy requirements from solar energy by 2022.
• Streetlights and water supply installation of corporations, municipalities and local urban bodies are mandated to meet 30 percent of their energy requirements from solar energy by 2022.
• All state government departments will replace 10 percent of their existing vehicle fleet with solar powered, electric vehicles by 2022.
• Suitable incentive programs will be designed to promote solar energy generation in the agricultural sector. This may include incentives to farmers for reported solar energy generation.
• The Government of Tamil Nadu wants to promote the manufacture of solar energy components including solar cells, inverters, mounting structures and batteries in the state. Land will be identified for the development of solar manufacturing. A single window process for all departmental approvals, including a set time limit for each approval is expected to be designed.
• An incentive program will be designed to promote the co-utilization of land for solar energy projects, crop cultivation and rain water harvesting.
• From April 2019 onwards, all new service connection meters in Tamil Nadu are to be configured for bidirectional energy recording and display so that all new service connections and existing service connections for which the meters are replaced in the normal course of maintenance are ready for effecting solar energy net metering at any time in the future.

The policy will be applicable to projects, programs and installations relating to both solar photovoltaic energy (solar PV) and solar thermal energy and the draft policy is open for comments, until a meeting is conducted for all involved stakeholders. For the central government, the Tamil Nadu draft should be a welcome development, if it has to have any chance of reaching its solar target of 100 GW   by 2022.

Recently, we reported that TEDA has put forth a plan to roll out one lakh grid-connected solar powered agriculture pumps at a projected cost of INR 13,500 crore.