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Encore: India installs a record volume of solar power in 2022

SCOTT SIMON, HOST:

India is a quickly developing country that's forecast to overtake China next year as the world's most populous nation. So it is constantly on the search for new energy sources. Most of India's electricity still comes from burning coal, but the government is trying to encourage solar energy. NPR's Lauren Frayer reports from Mumbai.

LAUREN FRAYER, BYLINE: How many stories is this building?

CHINMAY DIVEKAR: There's 27.

FRAYER: Twenty-seven. So we're climbing up a ladder now, up onto the top of the roof - quite a view. Wow, you can see the mountains.

DIVEKAR: So that is what is known as the Thane Creek.

FRAYER: Body of water in the distance.

DIVEKAR: Yeah.

FRAYER: It's not just the mountains that are impressive, though. It's the view before them of thousands of rooftop solar panels.

DIVEKAR: So you see most of the buildings. You can see that that building has solar - so...

FRAYER: Just a few years ago, these weren't here.

DIVEKAR: No, not at all.

FRAYER: Chinmay Divekar is a solar entrepreneur who's part of this change. His business partner is Jay Vyas, an accountant who, in his 60s, has become a solar evangelist. Before our interview, he sent me a pamphlet he wrote entitled "Sunny Makes Money."

JAY VYAS: When I wake up in the morning, I have committed myself to speak about solar to at least three people every day. You are one of them today.

FRAYER: Until recently, though, it was a tough sell. Despite having lots of tropical sunshine, about 70% of India's electricity comes from coal. Renewables mostly mean massive solar plants in the deserts of Rajasthan or Gujarat, or farmers using a panel or two to run irrigation pumps in rural areas where the grid is shaky. Solar never really caught on in urban India. The government subsidizes electricity, so it's cheaper here than in the West. And most solar panels are imported and expensive - not worth it for any single household. But that's changing, with record government investment in renewables this year, says energy economist Vibhu Tigard.

VIBHU TIGARD: Players who want to set up solar rooftops can register themselves. They'll get government subsidies.

FRAYER: Government subsidies for domestic solar panel production. That's what neighboring China did to make its own solar industry so successful. Jay and Chinmay used to import rather expensive solar panels from Singapore or Germany. Now they're using Indian ones.

So these are Indian-made?

VYAS: These are Indian-made panels. These are - this is our latest installation.

FRAYER: It says RenewSys, India, private limited.

Jay shows me his latest installation atop a big condo complex on Mumbai's northeast outskirts. The building manager is Swati Nevgi. As the prices of panels fell, her building's residents took a gamble on solar.

SWATI NEVGI: Ruukki (ph) society invested 1.4 million rupees.

FRAYER: That's to buy the panels themselves and install them.

NEVGI: Panels. Entire project - in the year 2020, we have got half a million recovery savings.

FRAYER: So that's within less than three years. The investment is...

NEVGI: The investment is recovered.

FRAYER: They recouped their investment with lower energy bills. But there's a catch. These new domestic panels aren't totally domestic, Chinmay says.

DIVEKAR: So basically, the silicone that goes inside - that's still imported from China. And that is subject to price fluctuation, so many other factors.

FRAYER: Some components still need to be imported.

DIVEKAR: Correct. But now there are huge manufacturing capacities being set up by - I don't know if you know these two groups, Adani and Ambani. And...

FRAYER: Who hasn't heard those two names in India?

DIVEKAR: Yeah.

FRAYER: Two of India's biggest conglomerates are getting government help to onshore the entire Indian solar panel supply chain. And if that happens, prices may come down even more. In the next 10 years, economists say solar may become India's cheapest energy source.

Lauren Frayer, NPR News, on a rooftop in Mumbai. Transcript provided by NPR, Copyright NPR.

Lauren Frayer covers India for NPR News. In June 2018, she opened a new NPR bureau in India's biggest city, its financial center, and the heart of Bollywood—Mumbai.