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How the world’s largest solar park is shaping up in Karnataka

LiveMint logoLiveMint 05-03-2017 Sharan Poovanna

Pavagada (Tumkur, Karnataka): Heat that can give you blisters. Fluoride contaminated water that can leave your bones brittle. Endless stretches of barren land where rains have stayed away for almost half a century. Thorny bushes the only vegetation in sight for miles.

An apt description of Pavagada—less than 200 km from Bengaluru, but it may as well be on another planet. The region is part of a large semi-arid tract in eastern Karnataka’s border district of Tumkur, which sits on an elevated plateau with several rocky hills all around. The state government has had to declare the region drought-hit 54 times in the last 60 years.

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The bone-dry region may be a bane for farmers, but could be a godsend for the state government which wants to experiment with something big—build what it claims is the world’s largest solar park.

The aim is to generate around 2700 megawatts (MW) from the Pavagada solar park by the end of 2018. The idea resonates with the centre’s ambitious scheme to generate 100 gigawatts (GW) of solar power by 2020.

Work has begun in right earnest on the project. Roads now cut through the vast expanse of sand. Scores of workers in hard hats and covered in dust are at work, putting up substations and power lines. The first phase capacity of 500MW has been bid out and generation is expected to start in the next four months.

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The park’s development is anchored by the Karnataka Solar Power Development Corp. Ltd (KSPDCL), an entity formed in March 2015 as a joint venture between Karnataka Renewable Energy Development Ltd (KREDL) and Solar Energy Corp. of India (SECI).

KSPDCL uses the “plug and play” model, under which it acquires and develops land as blocks for solar power generation, embedded with the required government approvals, and gives it out to solar power developers (SPDs) through auctions.

So far, plot allocation has been completed for 600 MW capacity. Six SPDs—Yarrow Infrastructure, Parampujya Solar Energy Pvt. Ltd, FortumFinnsurya Energy Pvt. Ltd, ACME Solar Holdings Pvt. Ltd, Tata Power Renewable Energy Ltd and Renew Power—have taken over land and commenced work.

The rest of the plots are in various stages of tendering.

The SPDs have, in turn, signed power purchase agreements with electricity supply companies or escoms. The agreements are drafted in such a way that the escoms get 90% of the power generated from the park, at a bundled tariff ranging between Rs3.50 and Rs4.50 a unit.

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KSPDCL has managed to acquire 12,000 acres of the 13,000 acres identified for the project, spread across five villages in Pavagada.

“It is a huge achievement. Land acquisition is a major challenge for any big project in India; especially for solar as around five acres of land is needed for 1 MW,” said Deepak Sriram Krishnan, manager of the energy department at World Resources Institute (India), a global non-governmental research organization.

G.V. Balram, managing director of Karnataka Renewable Energy Development Ltd (KREDL) and a Pavagada native, said that the credit for the smooth acquisition should go to the unique model deployed: the government did not acquire the land from farmers; it just sought to lease it for 25 years.

Balram said though farmers were emotionally attached to the land, they were happy to hand it over to a project if they could retain ownership. Farmers have so far not had an issue with the compensation amount—Rs21,000 per acre as lease, with a 5% appreciation every two years.

“Farmers have come to realise that it’s better if they don’t cultivate (the land). Anyway most of the time you don’t get enough rains to sustain the crops and invariably there is crop loss,” said Seshagiri Rao, a farmer and climate researcher who is a resident of a village in Pavagada.

But what will they do if they cannot farm?

“The impact is not that huge. Ten thousand acres is around five villages, so we are talking 5,000 families. I guess they will get jobs somewhere else. After all, we are talking about one of the most-arid regions in the country after Thar desert, where annual average rainfall is only 46 cm between June to November,” added Rao.

However, not everyone is happy. When Mint visited the region, villagers were upset with the government for not assuring power supply and jobs for them. Apparently, neighbours of what is touted as world’s largest solar power project are powerless.

Electricity is available for about three hours a day, though the voltage is too low to pump groundwater, complained many villagers.

State energy minister D.K. Shivakumar says that these issues will be looked at. “This taluk witnesses around 8,000-10,000 people leaving their villages to go work in Bengaluru and other places. We are trying to stop this. The government will make investments of over Rs15,000 crore in the region which will help create jobs.”

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