Published on September 1st, 2020 |
by Anand Upadhyay
September 1st, 2020 by Anand Upadhyay
After watching a 5-minute video on how easy it is to install a solar power plant and spending hours on horror stories of solar installations going wrong, many people simply sit on the fence when it comes to going solar.
The overabundance and ready access to information, in most cases, throws a spanner in the works, resulting in “analysis paralysis.” This is a HUGE concern, especially where the action is critical (climate change).
Speaking specifically of the housing cooperatives or residential societies in India, many have the ability to pay. But they don’t (maybe can’t) act. Many approach solar project developers with a defensive standpoint, probably due to a lack of trust.
Even in cases where something does move ahead, nitty gritties can derail the process of getting solar power to the cooperative.
Truth be told, this inaction — as you will see later in this article — costs these housing societies and the environment dearly, month after month.
Solar Can Lead To Zero Electricity Bills, But…
Recently I was chatting with Ms. Nitu Goel, co-founder of TrueSun Energy Solutions — a solar startup in Mumbai — about what can be done to accelerate rooftop solar installations in housing societies.
She had an interesting experience to share of installing a rooftop solar system in a housing cooperative that had been delaying the decision for over 3 years.
The barely 2-year-old company has worked with residential units, real estate players, educational, and other institutional organizations.
Some of its clients in Mumbai include Oberoi Realty Group, Kalpataru, Sasmira College, and Kruti Creatives.
Particularly, TrueSun has done extensive engagement with housing cooperatives in Mumbai.
One of the projects executed by her team in a residential society in Nallasopara, Mumbai, helped reduce their electricity bill by 95%, dropping from $600 (₹45,000) to less than $20 (₹1,500) every month.
The rooftop solar plant took care of nearly the entire electricity consumption of the society’s common areas such as elevators, water pumps, and passage lights of the building.
Interestingly, another plant installed by the company in a residential complex in Versova (Mumbai) saw a zero bill for the month of April 2020!
With such success stories abound, one would expect housing cooperatives to be chasing rooftop project developers.
Except they don’t.
Growth Of Rooftop Solar In India – Commercial Vs Residential Systems
The rooftop solar sector in India has grown significantly in the last few years. However, the installers’ focus has been more on the commercial and industrial (C&I) sector as compared to residential units.
As of December 2019, 81% of solar rooftops were installed in the C&I segment as against a mere 12% in the residential sector.
This is despite the fact that housing cooperatives have a significant potential to reduce their own electricity bills. Their consumption includes the common area electricity bills, for example, elevators, water pumps, clubhouse, and common area lighting.
Subsidies announced by the government have not been as effective as expected, though some states have done considerably better.
From the project cycle perspective, one key reason why many developers focus more on C&I is because they mostly have a professional decision-making system with only a few key decision-makers to be convinced.
Hurdles Faced by Housing Cooperatives
One of the key issues for the abysmally low adoption of rooftop solar in the residential sector has been the limited awareness and lack of knowledge.
TrueSun has worked with several residential societies that are keen to reduce their electricity bills and go solar. However, many of these project leads have been on hold for many years due to a lack of conviction among society members.
Since the cooperative funds are scrutinized in detail, decision-makers can many times prefer inaction over a wrong action.
Those who are ‘aware’ of rooftop solar have a number of questions. Some of these key concerns that project developers have to clarify/address are:
- What is the importance of rooftop solar? Does a society really need it?
- Who are the trusted project developers – should they go with big brands or cost-efficient local players?
- Which panels, inverters, and structure should they choose? What are the price vs performance concerns?
- Safety-related concerns – Among other things, could there be a fire threat?
- How does one make sure that the existing infrastructure is not damaged or put to risk?
- Will the society be able to use their terrace for other purposes? (A key concern in land-starved Mumbai)
- What kind of maintenance would be required for the rooftop solar system?
- Is there a provision for subsidy/other fiscal benefits? (Most high-quality project developers advise clients not to get into a subsidy mess, but it definitely does come up in the discussions.)
- Which permissions would be required from the municipality and power utility?
On top of this, once all the queries have been resolved and the time comes for action, the housing society management committee can struggle to build consensus and trust among all members.
A Simple Solution For A Housing Society In Mumbai
So when TrueSun was in discussion with a renowned housing society in Mumbai for installing a fairly large 100 kW rooftop solar system, rather than doing the project by themselves it readily offered ‘advice’ to the client instead.
First, a little background.
The society members, in this case, were keen to install a solar rooftop, but for more than 3 years their management committee had been unable to make a decision. The management had approached more than 10 project developers.
As expected, each developer gave their own proposal, supposedly the “best” for the society, and in the process confusing the housing society members ever more than before.
So, in their proposition to advise, TrueSun was engaged as a consultant to design the system, select an installer, and supervise the commissioning for quality assurance.
It is important to point out here that access to such professional advisory services has typically been available only to commercial and industrial organizations. This is both on part of the perceived value for professional advice sought by businesses as well as the large solar project sizes (relatively speaking).
TrueSun spent time with the management committee as well as society members to resolve their concerns and guide them through the entire process. Having a professional advisor helped address stumbling blocks and build trust in the community.
TrueSun interacted with over 200 residents of the society to address their concerns and queries. In the process, the company also broke down the financial projections of the proposed project to present its long term benefits.
As Nitu shares, in a housing society, even a small choice such as inverter placement can delay decisions. So to resolve this, TrueSun undertook multiple meetings and site visits with the managing committee of the society and conducted detailed assessments.
The biggest bottleneck in most of the projects has been the involvement of enthusiastic yet inexperienced residents to select the system components. For an inexperienced individual, it is difficult to understand the specifications of the products (panels, inverters, wires) that would best suit them and the warranties they’re entitled to.
TrueSun used its experience to smoothly navigate through this process and helped the committee arrive at a final system.
The housing society had two different utilities supplying electricity to its different wings and the managing committee was quite anxious about grid integration. Again, Nitu’s team, along with their electrical contractor, analyzed each meter load and respective tariffs, and worked out the optimal way.
Once the technical and budgetary approvals were in place, a tender was designed and floated to receive quotes and finally shortlist an EPC player.
Cost Vs Benefit Of Hiring A PMC For Solar Project
Nitu explains that it took them only 3 months of planning and work to bring clean solar energy to the housing cooperative which was otherwise lying on the backburner for over 3 years.
If we look at the opportunity cost in this particular case, the losses which accrued for 3 years of indecisive waiting period were huge and definitely avoidable!
A 100 kW solar plant can save up to ₹150,000 ($2000) per month. That’s ₹54,00,000 ($72,000) over the entire 3-year period. Going by the costs prevalent 3 years back, had the housing society chosen to act 3 years ago, they would have recovered the (higher) expenditure by now.
This solar plant would be able to offset carbon emissions equivalent to the action of about 4000 trees!
If advisory services are to be used, these would obviously increase the costs of rooftop solar project development. However, these are still manageable. Nitu estimates that the cost of providing project management service can range from ₹150,000-300,000 ($2000-4000) depending on the site location, design, and scope.
This can easily be recovered from 1-2 months of savings post-successful installation and commissioning of rooftop solar systems.
The solar rooftop sector has suffered due to low awareness and information about the technology. Knowledge sharing and understanding the product & pricing can help expedite the decision making process.
Nitu feels Project Management Consulting (PMC) services can go a long way and work as an important tool to escalate the penetration of solar energy in the residential sector. Handholding and guidance from an independent professional advisory firm can provide a lot of comfort and help, especially to the managing committees of housing societies.
By hiring a PMC service and taking professional advisory services, many housing societies can conclude the solar project commissioning in 2-3 months which otherwise would have been kept on hold for years. Thus the society can start realizing the benefits much earlier and eventually reduce their own operation and maintenance costs.
In case you have any questions or comments to share, I would love to hear from you.
Image credits: All images in this article were shared by TrueSun Energy Solutions
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