Solar power is a damn good idea, but it is not a magic bullet.

Let’s tell you something that will surprise you: As of early 2017, less than 1% of Indian homes and factories/commercial establishments have solar panels installed.

If there are so many benefits from solar power, why have not many more installed solar power?

Here are the reasons why solar is not a magic bullet:

  • Requires sizable installation area – Solar panels require sizable area to generate enough electricity. Thus, the amount of electricity your rooftop area can generate might not be enough for all your power requirements – this is especially true for commercial and industrial units.
  • High capital costs – Solar power plants also cost a significant amount in upfront capital costs. While this cost has come down significantly in recent years, it is still in the range of Rs 50-60 per Watt in 2017 for rooftop solar installations – a substantial amount for many businesses (for large installations, it costs about Rs 4.5-5 Crores/MW).

Not a complete grid replacement – Only in very few cases can solar power completely replace the grid; for all practical purposes, solar power can only be a complementary power source, especially for industries and commercial establishments.

So, like anything else in the world, solar power has its limitations.

At the same time, mark our words – starting 2017, you will see many, many more companies investing in solar panels. This is mainly owing to the attractive economics of solar power and a parallel increase in the cost of grid power. The savings that can be made from installing solar power have just about started getting tempting for commercial and industrial sectors.

Stuff to Remember

With its high area requirements, significant capital costs and infirmness, solar power has its limitations. Despite these, expect a significant adoption of solar power starting 2017 by the industrial and commercial sectors.