Chapter 1: Introduction
India is characterized by a high solar insolation and a dense population, which is a perfect combination for utilizing solar power in the country. At present, the country is a world leader as regards wind power generation . With respect to the solar energy segment, a number of large projects have been planed including setting aside an area of about 35,000 km2 in the Thar Desert for solar power generation projects, which has the potential of generating 700 Gigawatts to 2,100 Gigawatts . In addition, the Ministry of New and Renewable Energy has also come up with a plan to implement the Jawaharlal Nehru National Solar Mission (JNNSM) Phase 2 draft policy (see figure 1 below); through this policy, the government of India has the objective of installing 10 Gigawatts of solar power. In the 10 Gigawatts target, central schemes have been allocated 4 Gigawatts whereas the State specific schemes have been allocated 6 Gigawatts . During July 2009, the government disclosed a plan with a budget of US $ 19 billion aimed at producing 20 Gigawatts of solar power by the year 2020. This plan required the compulsory utilization of solar-power applications and equipments in hotels, hospitals and government buildings.
Figure 1: phases of the Jawaharlal Nehru National Solar Mission
During November 2009, the government reported that it was prepared to start implementing the National Solar Mission through the National Action Plan on Climate Change, with the aim of generating 1000 Megawatts of solar power by the year 2013 . During the period between August 2011 and July 2012, the grid connected photovoltaics in India increased from 2.5 Megawatts to 1000 Megawatts . The 2011 report published by the GTM Research and BRIDGE TO INDIA pointed out that India has the ideal storm factors needed to facilitate solar photovoltaic (PV) implementation at a significant pace in a period of at least five years . The continuously reducing prices for solar PV panels come at a time when the cost of grid power in the country is increasing steadily. In addition, sufficient solar power resources and government support have also played a pivotal role in accelerating solar power adoption; however, the biggest factor accelerating the adoption of solar power in India is need . This is because Indian has a growing economy characterized by a growing middle class size; as a result, the country is currently facing a significant electricity deficit of about 10-13% of the daily electricity required .
India has 300 clear and sunny days yearly, making its theoretical solar power reception to be nearly 5000 Petawatt-hours annually (PWh/yr), that is, on India’s land area only . The average solar energy incident on a daily basis in India ranges from 4-7 Kilowatt-hr per square meter (kWh/m2); this depends on location . In 2007, the total solar energy production in India was less than 1 percent of India’s total demand for energy. By 2005, the amount of solar energy funded by the government amounted to 6.4 MW-yr . By December2010, the grid connected solar PV was only 10 MW. Nevertheless, India was ranked first with respect to the solar energy produced per watt installed; India has a solar insolation of 1700-1900 Kilowatt hours per Kilowatt peak. In 2010 and 2011, 25.1 MW and 468.3 MW were added respectively . As of March 2013, India had a grid connected solar PV of 1686 MW, which relatively lower compared to Germany’s 34,000 MW of PV installations capacity  India is expecting that by 2017, there will be an extra 10,000 MW, and have 20,000 MW as of 2022 .
This study seeks to explore the potential of India with regard to the production of solar power. Currently, more than 400 million people living in the rural areas lack access to electricity and are still relying on kerosene for cooking and lighting up their homes. This indicates the high demand for electricity amid a supply shortage . In addition to other renewable sources of energy, the potential for production of solar energy is the highest; this is because India experiences about 300 days of clear and sunny weather in most parts of the country and the annual solar radiation ranges between 1600 and 2200 KWh/m2 .
There are several forms of alternative energy sources that India can implement to address its energy sources problem; however the scope of this project is only on solar energy production harvested using solar PV equipment.
1.2.1 Need for Solar Energy in India
There is no doubt that India has significant energy requirements and is currently facing several challenges in meeting its energy requirements using the conventional power generational approaches. During 2012, July 30 and 31, India had the largest power blackout across the globe (The Great India Outage), which stretched from Kolkata to New Delhi . This blackout was attributed to the northern power grid failure, resulting in about 700 million people going without power . This substantial grid failure highlighted the country’s massive demand for electricity as well as its struggle to produce sufficient power to meet the country’s electricity needs. To this end, India has plans to increase its power generation capacity by 44% in the coming 5 years; however, current problems such as energy shortages and the Great India Outage point out the scope and magnitude of the challenge . Prior to the blackout, India reported a decline in power generation by 5.8% during June 2012 (India had a production capacity of 209.27 GW during the 2011-2012 year); at a time when the peak-hour demand for electricity was 128 GW . 
In addition, the consumption of electricity in India is increasing at a steadfast rate (4 percent) because of economic development as well as population growth . The economy of India is facing significant challenges since the supply of energy is not sufficient to meet the energy demand; the magnitude of the problem is worsened by the fact that energy shortages are evident in India (about 15% daily) . As a result, lack of adequate energy as well as unreliable supplies is a significant threat to the economic growth of India. In order for India to meet its present and future energy needs and eradicate the frequent power outages, the government should perform an assessment as regards the best approach to tackle the issue of power demands . To this end, the current energy shortage presents an ideal opportunity for India to devise a plan aimed at coming up with sustainable solutions to address the current as well as future energy demands. For environmental and economic reasons, there is the need for India to move towards the use of environmentally safe renewable energy sources to meet the current and future electricity demands . There is no doubt that a renewable energy source is the ideal solution since it guarantees long-term economic growth. A good renewable energy policy has the potential of creating new jobs together with an economic stimulus of over US $ 1 trillion . Using renewable energy sources will also facilitate a decentralized energy distribution, especially with regard to meeting the rural energy requirements . Solar PV energy also has the potential of shifting nearly 90% of the daily petroleum mileage to electricity since people will be more encouraged to use plug-in hybrid cars; this has the potential of reducing the cost per mile by 25% 
At present, India lacks an overarching energy strategy; rather, it has several disparate energy policies. Instead of using an overarching energy strategy, India relies on a bunch of energy business policies and models, which have not yielded any meaningful results with regard to addressing the increasing energy demand in the country . In addition, these policies are having detrimental impacts on expansion plans to increase the adoption of renewable energy sources.