Jawaharlal Nehru National Solar Mission
The Jawaharlal Nehru National Solar Mission (also known as the National Solar Mission) is a major initiative of the Government of India and State Governments to promote ecologically sustainable growth while addressing India’s energy security challenges. It will also constitute a major contribution by India to the global effort to meet the challenges of climate change. Named for Jawaharlal Nehru, the Mission is one of the several initiatives that are part of National Action Plan on Climate Change. The program was officially inaugurated by Former Prime Minister of India, Dr Manmohan Singh but its adequate implementation is being carried out by Sri Narendra Modi. United States filed a case with WTO against India for restricting the critical materials used to domestic content.
The objective of the National Solar Mission is to establish India as a global leader in solar energy, by creating the policy conditions for its diffusion across the country as quickly as possible. The immediate aim of the Mission is to focus on setting up an enabling environment for solar technology penetration in the country both at a centralized and decentralized level. The first phase (up to 2013) will focus on capturing of the low hanging options in solar thermal; on promoting off-grid systems to serve populations without access to commercial energy and modest capacity addition in grid-based systems. In the second phase, after taking into account the experience of the initial years, capacity will be aggressively ramped up to create conditions for up scaled and competitive solar energy penetration in the country.
The Mission under the aegis of Ministry of New and Renewable Energy  will adopt a 3-phase approach, spanning the remaining period of the 11th Plan and first year of the 12th Plan (up to 2012-13) as Phase 1, the remaining 4 years of the 12th Plan (2013–17) as Phase 2 and the 13th Plan (2017–22) as Phase 3. At the end of each plan, and mid-term during the 12th and 13th Plans, there will be an evaluation of progress, review of capacity and targets for subsequent phases, based on emerging cost and technology trends, both domestic and global. The aim would be to protect Government from subsidy exposure in case expected cost reduction does not materialize or is more rapid than expected.
The first phase of this mission aims to commission 100 GW of grid-connected solar power projects by 2013. The implementation of this phase is in hands of a subsidiary of National Thermal Power Corporation, the largest power producer in India. The subsidiary, NTPC Vidyut Vyapar Nigam Ltd (NVVN), laid out guidelines for selection of developers for commissioning grid connected solar power projects in India. See JNNSM Phase 1 Guidelines. While NVVN is the public face of this phase, several other departments and ministries will play a significant role in formulating guidelines. NVVN will sign power purchase agreements with the developers. Since NVVN is not a utility, it will sell purchased power to different state utilities via separate agreements.
For Phase 1 projects, NVVN started with a proposal for 50:50 allocation towards solar PV and solar thermal. The latter is quite ambitious given India has no operational solar thermal projects and less than 10MW of solar PV projects. While growing at a rapid pace lately, solar thermal technologies are still evolving globally. The first batch of projects allotted for Phase 1 included 150MW of Solar PV and 500MW of Solar Thermal. NVVN issued Request for Selection document outlining criteria for selection of projects under the Phase 1. See Solar Thermal RFS, Solar PV RfS
A growing solar PV industry in India is hoping to take off by supplying equipment to power project developers. Well known equipment manufacturers started increasing their presence in India and may give competition to local Indian manufacturers. Due to generally high temperatures in India, crystalline silicon-based products are not the most ideal ones. Thin film technologies like amorphous silicon, CIGS and CdTe could be more suitable for higher temperature situations.
NVVN Solar PV allotment process for Phase 1
NVVN issued Request for Selection notice for allotment of capacity to Independent Power Producers (IPPs). See NVVN Solar PV RfS. 150MWs of Solar PV and 470MW of Solar Thermal were up for allotment under the first batch of Phase 1 projects. Project size per IPP was fixed at 5MW for Solar PV and 100MW for Solar Thermal projects. To avoid allocating entire capacity to a select few corporate, guidelines required no two projects to have the same parent company or common shareholders. In case of over subscription, a reverse bidding process was to be used to select the final IPPs based on lowest tariff they offer. Several hundred IPPs responded to this RfS.
The approach for reverse bidding and methodology to calculate the discount to be offered was presented by Shri Shakti Alternative Energy Ltd through a webinar on 19 October 2010 on the eve of the reverse bidding by NVVN Download presentation on Reverse Bidding by NVVN - What to Expect. The quantum of discount would depend on project site location (i.e. solar radiation), technology used, simulated energy generation, capital cost and interest cost. Multivariate analysis was carried out using key variables like capital cost, interest and the capacity utilization factor (i.e. CUF which is actual generation of the plant and depends on the location (radiation) and technology used)to calculate the levelized tariff for a target equity IRR based on which the discount to be offered can be determined.
The final 30 solar PV projects selected had bids between INR 10.95 to INR 12.75. The Solar Thermal projects selected had bids between INR 10.24 to INR 12.24. PPAs were signed with IPPs in early January.
Domestic content controversy
Guidelines for the solar mission mandated cells and modules for solar PV projects based on crystalline silicon to be manufactured in India. That accounts to over 60% of total system costs. For solar thermal, guidelines mandated 30% project to have domestic content. A vigorous controversy emerged between power project developers and solar PV equipment manufacturers. The former camp prefers to source modules by accessing highly competitive global market to attain flexible pricing, better quality, predictable delivery and use of latest technologies. The latter camp prefers a controlled/planned environment to force developers to purchase modules from a small, albeit growing, group of module manufacturers in India. Manufacturers want to avoid competition with global players and are lobbying the government to incentivise growth of local industry.
Market responded to domestic content requirement by choosing to procure thin film modules from well established international players. A significant number of announced project completions are using modules from outside India.
US Trade Representative has filed a complaint at World Trade Organization challenging India’s domestic content requirements in Phase II of this Mission, citing discrimination against US exports and that industry in US which has invested hugely will be at loss. US insists that such restrictions are prohibited by WTO. India however claims that it is only an attempt to grow local potential and to ensure self sustenance and reduce dependence
- Solar to light up Rural India
- JNNSM: The Sunshine of India’s National Action Plan on Climate Change
- http://indianpowersector.com/electricity-regulation/national-solar-mission/ National Solar Mission
- India's National Action Plan on Climate Change - Highlights
- JNNSM Inauguration
- Webinar On Reverse Bidding Strategy
- "NVVN Phase 1 Batch 1 Solar PV Projects" (PDF).
- "First Solar to supply modules for an Indian Solar PV developer".
- "Trina supplying modules for an Indian Solar PV plant".
- "US challenges India’s Domestic Rules in National Solar Mission". IANS. news.biharprabha.com. Retrieved 11 February 2014.