Anantapur, India, Will Save $1 Million Every Year with New Solar Project

The municipal corporation of Anantapur in the south Indian state of Andhra Pradesh is set to become the first municipality in the country to set up a solar project to power its water pumping operations and street lights. The impressive plan includes installation of a 5 MW solar PV project in the city. The project will be connected to the state’s power grid and will power the water pumping and street lights of the entire municipality’s area.

Anantapur is blessed with significantly high solar energy resource and has already attracted investment from project developers under India’s famous Jawaharlal Nehru National Solar Mission (JNNSM).

The solar project would require an investment of $11 million (Rs 60 crore) and would include installation of nearly 40,000 solar panels. The municipality currently consumes 5 MW on water pumping operations and powering the street lights. This entails an average electricity bill of $1 million per year.

With the new 5 MW solar PV project, the municipality will be able to power all these operations with clean energy and save $1 million every year. The total cost of the project would be recovered in 11 years and the municipality will then earn profits for about 14 years, assuming the life of the power plant is 25 years. Additionally, the project will also offset over 180,000 tons of carbon emissions over the 25 years of its life.

The municipal authority hopes to secure financial assistance from the Ministry of New & Renewable Energy. The authority will repay loans from the ministry in seven years through the savings achieved in electricity bill payments.

The state of Andhra Pradesh suffers from tremendous demand-supply mismatch in the power sector. The industries in the states have been facing the brunt of the low supply of electricity and are forced to cut production significantly. A large number of power plants in the state use natural gas as fuel and the supply of natural gas, too, has fallen significantly across India.

Solar energy presents a highly logical solution to the poor power situation in the state. The state government recently offered project developers tender to set up 1,000 MW of solar power capacity. The tender received an overwhelming response with developers offering to install up to 1,340 MW of solar power projects.