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PARTNERSHIP TO ADVANCE CLEAN ENERGY

DEPLOYMENT (PACE-D)

Technical Assistance Program

Issue Paper on Solar Rooftop Adoption by

Urban Local Bodies

Submitted on February, 2018

TABLE OF CONTENTS 1 Introduction to Solar Rooftop Program ......................................................................... 1

2 Policies and Programs for Solar Rooftop Projects – Role of ULBs ............................... 4

National programmes for promotion of solar rooftop power projects ............................ 4

Model building bye-laws of Ministry of Urban Development ......................................... 5

3 Challenges Faced by ULBs in Implementation of Solar Rooftop .................................. 8

Amendment, Adaption, and Enforcement of Existing Building Bye-Laws ..................... 8

Lack of Consumer Awareness ..................................................................................... 8

Limited PV installations at ULB establishments ............................................................ 9

Lack of Policies/Programs/Target Setting .................................................................... 9

Coordination Gap ......................................................................................................... 9

Lack of financing mechanisms ..................................................................................... 9

4 International Experiences ........................................................................................... 10

5 Recommendations for ULBs for Promotion of Solar Rooftop Projects ........................ 15

Promotion and development of local solar rooftop market .......................................... 15

Organising and strategizing efforts for developing the solar rooftop projects .............. 15

Making the technology affordable by devising innovative financing mechanisms ....... 18

Leading by example with installations on own buildings ............................................. 19

6 Way Forward ............................................................................................................. 20

TABLE OF FIGURES

Figure 1: MNRE Year Wise Solar Rooftop Targets (MW) ...................................................... 1

LIST OF TABLES

Table 1: Provision and Applicability for Installation of Solar Rooftop for Various Plot Sizes

(Residential and Non-Residential) ......................................................................................... 6

Table 2: Norms for Solar PV Rooftop Installation and Generation ......................................... 6

Table 3: Feedback received from ULBs during discussions .................................................. 8

Draft Issue Paper on Solar Rooftop Adoption by Urban Local Bodies: PACE-D Technical Assistance Program United States

Agency for International Development Contract AID-386-C-12-00001 Page 1

1 INTRODUCTION TO SOLAR ROOFTOP PROGRAM

The Government of India (GoI) adopted Jawaharlal Nehru Solar Mission (National Solar

Mission or NSM) in January 2010, to rapidly build the solar power capacity in the country

and achieve a grid-connected capacity of 20 GW by 2022. The target was later revised to

100 GW in 2015, with 40 GW targeted to come from grid-connected solar rooftop projects

(year-wise targets are shown in Figure 1). Various Central and State government schemes

under NSM provided a major boost to the grid-connected solar power plants and resulted in

the growth of installed capacity of solar power plants by over 80 percent since 2015, to

above 12 GW by March 2017. In recent years, the grid-connected large scale solar market

has achieved substantial consolidation and maturity. However, the rooftop systems owing to

their small size and decentralized/local installation are still faced with several challenges. As

per Ministry of New and Renewable Energy (MNRE), the overall commissioned capacity of

solar rooftop was 823.64 megawatt (MW) as on October 31, 2017 against the target of 4,800

MW till FY 2017-18. The progress made is significantly less than envisaged and needs a

concerted effort by all the stakeholders involved to promote the rooftop systems.

Figure 1: MNRE Year Wise Solar Rooftop Targets (MW)

As the name suggests, the solar rooftop invariably required to be set up on roofs of buildings

(while in some cases ground mounted within the premises are also considered as rooftops),

thereby, apart from industries, the primary growth areas would necessarily be the urban

centres or cities with high population density with large number of residential, commercial

and institutional buildings having roofs available for putting up the rooftop solar projects.

In India, the local governance of cities or urban areas is managed by Urban Local Bodies

(ULBs), which are necessarily the Municipal Councils or Municipal Corporations. These

ULBs are autonomous bodies/institutions established under the respective state /city

municipal corporation act. The 74th Amendment of the Constitution of India transferred

powers of urban management to urban local bodies (ULBs) i.e., municipal corporations and

municipalities (and notified area councils or city councils). The responsibilities of ULBs

include obligatory and discretionary functions1. The governing members are democratically

1 Some obligatory functions: Supply of pure and wholesome water, Construction and maintenance of public streets, Lighting and watering of public streets, Cleaning of public streets, places and sewers, Regulation of offensive, dangerous or

5,000

6,000

7,000

8,000

9,000

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1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

2017-18 2018-19 2019-20 2020-21 2021-22

Capacity (

MW

)

Years



elected. The major source of revenue for the ULBS include property tax, advertisement tax,

rent, trade license fee, parking fee, water and sanitation fee, entertainment tax.

As per the 16th Lok Sabha Standing Committee Report on Energy, slow progress in the solar

rooftop sector is attributed to:

Complicated procedures to obtain approvals and grid interconnection

Reluctance of DISCOMs to operationalize net-metering regulations

Procedural delays in obtaining subsidy

Lack of innovative financing mechanisms

Lack of consumer awareness

Skill and knowledge gaps

Lack of uniform policy

ULBs or the local governments are uniquely positioned to remove many of these barriers

through policy changes mainly by incorporating mandatory provisions for solar rooftop

installation on buildings and by promoting market development in their communities. A huge

potential exists for deployment of solar photovoltaic (PV) rooftop on residential, commercial,

and institutional buildings as well as ULBs’ own public buildings. ULBs like Thane Municipal

Corporation, New Delhi Municipal Corporation (NDMC), Chandigarh Administration, etc.

have taken a lead and have installed solar rooftop systems on their own and other public

buildings.

Internationally, local government programs such as investment tax credits, renewable

energy rebates, and financing models such as property tax assessment model and

community shared model helped in the scale-up of renewable energy installations.

A few pro-active ULBs have provided incentives to the consumers for installations of solar

energy systems. Thane Municipal Corporation has been promoting solar energy and energy

efficiency since early 2000s by providing incentives such as 10 percent rebate in property

tax to promote installations of solar water heating system in existing residential buildings.

Amritsar Cantonment Board has included a clause in its Building Bye Laws, 2017 that,

“an owner who adopts solar power energy / solar off grid applications in the building, which

generates energy will be entitled to rebate in the property taxes. The energy audit report

should be submitted every three years form the competent authority / accredited agencies

registered with MNRE to prove that energy consumption is brought down”2. ULBs can

undertake following further initiatives to scale-up solar rooftop projects:

Launch and conduct consumer awareness drives and programs.

obnoxious trades and callings or practices, Maintenance or support of public hospitals; establishment and maintenance of primary schools, Registration of births and deaths; removing obstructions and projections in public streets, bridges and other places

Some discretionary functions: Construction and maintenance of public parks, gardens, libraries, museums, rest houses, leper homes, orphanages and rescue homes for women, planting and maintenance of roadside and other trees, Housing for low income groups, Conducting surveys

2 Cantonment Board Amritsar Building Bye Laws - 2017



Aggregate demand of solar rooftop projects and invite bids on behalf of building

owners.

Provide other incentives such as property tax rebates, additional subsidies

Incorporate mandatory solar rooftop installation clause in the building bye-laws.

Initiate installation of solar rooftop systems in their own buildings including institutional

buildings

Co-ordinate with the State Nodal Agency (SNA) to design innovative programs to

finance the solar rooftop installations.

This Issue Paper examines best national and international practices for promotion of solar

rooftop systems by ULBs, the challenges faced by Indian ULBs for deployment of solar

rooftop projects and provides recommendations for overcoming these challenges for

promotion of solar rooftop systems at the local level.

This paper is organised into five chapters. While Chapter 1 one sets the context of

importance of ULBs in accelerated deployment of solar rooftop systems in urban areas,

Chapter 2 describes the roles and the activities undertaken by ULBs under existing

programs / schemes, Chapter 3 discusses the international best practices by local

governments for promotion of solar rooftop, Chapter 4 documents challenges faced by ULBs

in adoption/installation of solar rooftop systems and Chapter 5 provides recommendation

and actionable items for the ULBs for overcoming the challenges and developing the local

ecosystem for solar rooftop installations.



2 POLICIES AND PROGRAMS FOR SOLAR ROOFTOP PROJECTS – ROLE OF

ULBS

Government of India under different ministries have launched several national missions for

promotion of decentralised solar power projects. These mission and schemes identify ULBs

as a main stakeholder owing to their presence at the grass root level. National Smart City

Mission, Solar City program and other MNRE schemes have identified significant roles for

ULBs. These programs / schemes and best practices from ULBs are discussed briefly in the

following section.

National programmes for promotion of solar rooftop power projects

2.1.1 National Smart Cities Mission

Government of India launched the Smart Cities Mission (SCM) on June 25, 2015 with an

objective to promote sustainable and inclusive cities having core infrastructure to provide

optimal standard of living to the citizens, a clean and sustainable environment and

application of ‘Smart’ Solutions for improved infrastructure. A total of 90 cities are selected

as smart cities. The implementation of the Smart Cities Mission is done by a Special

Purpose Vehicle (SPV) which would be promoted by the State/UT and the Urban Local Body

(ULB) jointly both having 50:50 equity shareholding. One of the major components of Smart

City initiative is to reduce the dependence of cities on non-renewable energy resources and

shift toward use of renewable energy resources. The mission statement for smart cities

dated June 2015, states,

“In particular, the elements that must form part of a SCP are assured electricity supply with

at least 10% of the Smart City’s energy requirement coming from solar. Solar roof-top is

identified as a key energy resource for inclusion in smart city development”3.

Few municipal corporations have implemented solar roof-top systems under the smart city

mission.

Under the smart city initiative, NDMC had installed an aggregate capacity of 1,495 kW in 28

different government buildings in its area4 in NDMC area. The total cost incurred for

installing the solar power capacity was INR 9.39 Crore and was funded through a mix of

RESCO and Capex model. The project has also received 30 percent capital subsidy from

the Ministry of New and Renewable Energy under the grid-connected rooftop scheme. For

Jaipur Smart City, solar rooftop target was set to 2.1 MW, of which approximately 1.6 MW

has been installed till date on capex mode under net metering.5

2.1.2 Solar Cities program of MNRE

Solar Cities program aims to assist ULBs in assessing their present energy consumption &

future demand and preparing master plans for RE installations & energy efficiency

measures. It envisages minimum 10 percent reduction in projected demand of

conventional energy at the end of five years through a combination of renewable

3 http://smartcities.gov.in/upload/uploadfiles/files/SmartCityGuidelines(1).pdf

4 http://amrut.gov.in/writereaddata/6-Success%20Stories%20from%20Mission%20Cities%20Lowres.pdf

5Stakeholder Consultation with Jaipur Smart City Limited.



energy sources and energy efficiency measures.6 A total of 60 cities/towns are proposed

to be supported for development as Solar Cities. Master plan of approximately 35 solar cities

were prepared by April 2016. Depending upon population and initiatives decided to be taken

by the City Council/ Administration, financial assistance of up to Rs. Fifty Lakhs per city/town

is provided by MNRE. This incentive is non-exclusive of financial and fiscal incentives

available under other programmes of MNRE. MNRE will also provide technical help to ULBs

for preparing master plan, capacity building and awareness generation activities. Sanctions

have been given to 31 cities which have received in-principle approvals.

Specific activities envisaged for ULBs

i. To create a “Solar City Cell” and to constitute a “Solar City Stake Holders Committee”

ii. To promote National Rating System for construction of energy efficient Green

Buildings

iii. To amend building bye-laws for making the use of solar energy mandatory

iv. To provide rebate in property tax

v. To comply with MSW Rules 2000 notified by the Ministry of Environment

vi. To organize rigorous publicity, and the training programmes/ business meets for

various stake holders

vii. To generate necessary funds from State Govt. and other funding organizations for

achieving the objective of making the city as “Solar City”

Among Solar Cities, Chandigarh has taken a leading Position and has installed rooftop Solar

Plants of 7.782 MW capacity on 161 different sites by March 31, 20167. The administration

took several innovative steps for development of solar rooftop projects such as ensuring

guaranteed minimum electricity generation for each solar plant from the technology

providers, promoting make in India campaign by installing Indian made Solar Panel with 15

percent minimum efficiency, carrying out third party Inspection for solar plants installed to

ensure its technical standards & quality, and including 10 years operation and maintenance

provision in the supplier’s contract. It aims to achieve 50 MW Solar Power in future.

Best practices adopted by Chandigarh for promotion of solar power projects:

i. Amended Building By- laws to make Solar PV Installation mandatory on all buildings

ii. Empanelment of Solar Plant Installers/aggregators with standard rates

iii. Publicity through Newspaper, FM, advertisements in Movie Hall, Cable Operators,

organisation of camps in residential sectors etc.

iv. Launch of an online website/software platform for ease of business & transparency. The

subsidy from Chandigarh Renewal Energy Science & Technology Promotion Society

(CREST) for solar rooftop system can be obtained through the portal. It also acts as a

single window to obtain all the required regulatory clearances for the project.

It is fact that ULBs who also undertake power distribution business, namely NDMC and

Chandigarh Administration are more proactive in the solar rooftop deployment initiatives.

However, other ULBs like Thane Municipal Corporation, Jaipur Municipal Corporation

(though Jaipur Smart City) are also taking active initiatives.

Model building bye-laws of Ministry of Urban Development

6 http://mnre.gov.in/schemes/decentralized-systems/solar-cities/

7 http://www.ireda.gov.in/writereaddata/CompendiumSolar2016/PPT/Santosh%201.pdf



In 2016, Ministry of Urban Development (MoUD), Government of India (GoI) published

Model Building bye-laws and announced the incorporation of solar rooftop plants from

planning stage for both residential as well as non-residential buildings. The buildings were

categorized as plotted housing, group housing and all other buildings including educational,

institutional, commercial, industrial, mercantile, and recreational. As per the model bye-laws,

installation of solar rooftop systems for plot areas beyond 100 sq. m. is mandatory. General

requirement for setting up solar rooftop systems for the above-mentioned categories of

buildings is kept at minimum five percent of connected load or 20 Watt per square feet (sq.

ft.) of available roof space, whichever is less. These bye laws serve as guidance for State

Governments, Urban Local Bodies, Urban Development Authorities etc. and responsibility to

adopt and enforce these lies with state government. State bye-laws apply to the building

activities in Municipal areas of all Municipal Corporations / Councils / Nagar Panchayats.

The practice of incentives and penalties to promote such systems shall be formulated by the

local bodies.

The provisions and norms for solar rooftop installation are illustrated in Table 1 and 2

respectively.

Table 1: Provision and Applicability for Installation of Solar Rooftop for Various Plot Sizes (Residential and Non-Residential)

8

Plot

Category

Applicable Plot Area

(sq. m.)

Provisions for

Residential

Provision for

Non-Residential

I Up to 100 Nil Nil

II 100 to 500 √ √

500 to 1,000 √ √

1,000 to 3,000 √ √

III Above 3,000 √ √

Table 2: Norms for Solar PV Rooftop Installation and Generation9

Sr. No. Category of Building/Area Area Standards Generation Requirement

Residential

1. Plotted Housing For High Income

Group (HIG) plots

and above

Minimum five percent of connected

load or 20 W/ft2 for available roof

space, whichever is less

2. Group Housing All proposals as per

Group Housing

Norms

Same as above

All Other Buildings (Government or Private)

(Mandatory for Buildings Having Shadow Free Rooftop Area >50 sq. m.)

1. Educational, Institutional,

Commercial, Industrial,

Mercantile, and Recreational

Plot size of 500 sq.

m. and above

Same as above

States like Punjab, Rajasthan, Haryana, Uttar Pradesh, Gujarat, Assam, Andhra Pradesh,

Karnataka, Delhi have amended their bye-laws incorporating provisions for solar PV

installation in accordance with the model bye-laws of MoUD, whereas states like

Maharashtra, Uttarakhand, Meghalaya, Himachal Pradesh are yet to amend. Proper

implementation of these bye-laws is the key to scale-up deployment of solar rooftop across

8Model Building Bye-Laws 2016.

9Model Building Bye-Laws 2016.



the country. State wise provisions under Smart City Proposal and Building Bye-Laws has

been summarised in Annexure 1.

Active and rapid implementation of these programs and initiatives is expected to enhance

the capacity addition of solar PV rooftop across the country. Simultaneously, ULBs require

encouragement to create an ecosystem and to become one-stop shop for all rooftop

approvals and subsidies, thereby facilitating scale-up of solar PV rooftop market.



3 CHALLENGES FACED BY ULBS IN IMPLEMENTATION OF SOLAR ROOFTOP

ULBs face several challenges with the deployment of solar rooftop systems in buildings.

Discussions were conducted with various municipal corporations to understand the

challenges faced in implementation of solar rooftop systems and the opportunities that exist.

The summary of feedback from the key stakeholders is presented in Table 3.

Table 3: Feedback received from ULBs during discussions

S. No. Organization Challenges Suggestions

1 New Delhi

Municipal

Council

Lack of consumer

awareness and

inadequate innovative

mechanisms

Promote new business models and

launch programs for building

consumer awareness.

2 Ministry of

Urban

Development

(MoUD),

Government of

India

Minimal participation

from commercial sector

Recommend policies for

commercial buildings as no

subsidy is available for commercial

buildings under RESCO mode.

Municipal Corporations can

provide additional subsidies

beyond 20-30 percent working with

SPVs as city administration would

speed up the process.

4 Rajasthan

Renewable

Energy

Corporation

Limited

(RRECL)

Coordination gap

amongst RRECL and

Jaipur Smart City for

deployment of solar

rooftop in Jaipur

Need for innovative mechanisms

and online portal for better

monitoring and control.

5 Jaipur Smart

City Limited

Lack of consumer

awareness and

connectivity like

interconnection

Amendment in bye-laws and

subsidized loans for installations.

Assign additional budget to reach

out to institutional buildings.

6 Pune Municipal

Corporation

Non-availability of funds

and lack of consumer

awareness

Allocate budget to install solar

rooftop systems across the city.

Based on the feedback received during stakeholder consultation, the key challenges

identified by the Program are discussed in the following sections.

Amendment, Adaption, and Enforcement of Existing Building Bye-Laws

MoUD, GoI in their amended model building bye-laws have incorporated provisions to install

solar rooftop on new buildings. Several states amended their respective bye-laws in line with

the existing building bye-laws of MoUD. Building regulation being a state subject, the

responsibility to adopt, notify, and enforce the building bye-laws rests with the State

governments. Uniform adoption of these model building bye-laws by the States is still a

challenge across the country.

Lack of Consumer Awareness



Lack of Consumer awareness regarding rooftop PV and benefits to adopt such systems are

the most significant challenges in promoting solar energy. Consumers, especially under

residential segment lack awareness of the government policies and the available incentives.

Besides, uncertainty of procedure and delay in release of subsidy from the government

through State Nodal Agencies (SNAs) is also a major challenge.

Limited PV installations at ULB establishments

ULBs’ own establishments such as office buildings, hospitals, education institutes, water

pumping stations, etc. present huge potential and opportunity for harnessing solar rooftop at

these sites. However, lack of adequate funding resources, budget constraints pose as major

challenge for ULBs to take up the same. To address these limitations, innovative business

models through RESCO or PPP mode needs to be explored.

Lack of Policies/Programs/Target Setting

ULBs do not have targets for solar rooftop targets in their respective geographical areas of

control or for their own establishments.

Coordination Gap

There is lack of coordination between agencies such as state governments, ULBs, state

nodal agencies, and smart city limited. Presently, only government buildings are targeted to

set up solar rooftops. Smart cities are interested to install additional solar rooftops if

sufficient budget is provided so that buildings of hospitals, schools, and universities can be

targeted in future. Hence, an enabling mechanism should be developed for smooth working

with Smart City and Solar City programs.

Lack of financing mechanisms

Consumers in residential sector with limited financial resources are generally unable to

adopt rooftop systems due to its high capital cost. Normally, payback period typically lies

between 5 to 6 years and 7 to 8 years in commercial and residential sectors respectively.

The subsidy from MNRE has been discontinued for private commercial and industrial

buildings. Therefore, success of solar rooftop for such consumers depends upon

development of new and innovative new business models.



4 INTERNATIONAL EXPERIENCES

Internationally, there is an enormous push for solar rooftop projects through participation of

local authorities and urban bodies. This chapter collates few leading international

experiences wherein ULBs and local authorities have successfully undertaken various

initiatives for solar rooftop deployment in their respective areas through community

participation and innovative ideas.

The City and County of San Francisco, a municipal corporation amended its green building

code operative from January 1, 2017. It mandates solar installation on newly built roofs. Brief

description of clause mentioned in green building code is as follows10:

Also, several programs have been developed for promotion of solar rooftop installations, for

example, community shared model, property accessed clean energy model and policies

such as group purchasing, virtual net metering, etc. many of which have been initiated and

developed by Local Governments. Few of these programs are briefly discussed in the

following section.

Community Shared Model

Community Shared Model allows consumers to either buy or lease a portion of large

distributed solar system which can be used to meet their electricity demand through solar

energy generation, similar to installing their own rooftop system. Consumers thus receives

virtual net metering benefits in exchange for their financial contribution in terms of up-front

purchase of PV panels or a monthly charge on the customer’s utility bill. Also, this model

provides an opportunity to rooftop owners to obtain solar energy who are otherwise unable

to access solar power because of shaded roofs, financial constraints and other reasons.

10

The San Francisco Green Building Code

San Francisco Green Building Code, 2017

Clause on Renewable Energy and better roofs:

As per the green building code of San Francisco, newly constructed buildings which are

less than or equal to 10 occupied floors applying for a building permit on or after

January 01, 2017 shall install solar photovoltaic systems and/or solar thermal systems in

the solar zone.

The solar zone is an allocated space that is unshaded, un-penetrated, and free of

obstructions and hence ideal for solar installations. The total area of the solar zone may

be composed of multiple sub-areas, with each sub-area dimension not less than five

feet. If the total roof area is equal to or less than 10,000 square feet (1,000 square

meters), each sub-area must be at least 80 square feet (8 square meters). If the total

roof area is greater than 10,000 square feet (1,000 square meters), each sub-area must

be at least 160 square feet (16 square meters). The sum of the areas occupied by solar

photovoltaic collectors and/or solar thermal collectors must be equal to or greater than

the solar zone area.



Funding for such projects is arranged by local governments through own funds or leveraged

from the lending institutions.

Over the past few years, a number of states in the United States have expanded their on-site

solar programs by instituting policies that encourage community solar programs. Such

policies are grouped into three categories: group billing, virtual net metering and joint

ownership.

Policies to Support Community Shared Model

Group Billing

Under this framework, group billing allows multiple participants to receive net-metering

credits from a single renewable energy facility.

Group Purchasing

Members of a community interested in installing solar are grouped into one purchasing pool,

which negotiates a reduced rate from a developer or solar provider for the cost of the

systems and the installation.

Case Study: Sacramento Municipal Utility District (SMUD) - SolarShares Program

SolarShare program launched by SMUD allows customers to purchase electricity

generated by solar project on monthly basis. Responsibility to build, own and maintain

lies with the Developer, enXco, who in-turn sells power to SMUD under power purchase

agreement. Electricity thus generated is fed into the grid and total electricity generated

becomes the basis for SolarShare program. Consumer gets enrolled with utility through

an online application process, once enrolled customer is locked in at the fixed monthly

fee as long as they wish to participate. Depending upon the amount (from 0.5 to 4 kW)

subscribed and average electricity consumption, customer pays a fixed monthly fee.

Role of ULB: Acts as an aggregator on behalf of its consumers to provide electricity from

solar on monthly basis.

Incentive: 30% federal Business Investment Tax Credit to Developer.

Outcome: Customers pay a fixed monthly fee in return for a kWh credit.

Installed capacity: 1 MW

Over 22 groups were formed in service territories of Vermont’s two largest utilities, Green

Mountain Power and Central Vermont Public Service territory to share in the output of a

renewable energy system with system sizes ranging from 1.5 kilowatts to 199

kilowatts.



Property Tax Assessment or property assessed clean energy financing Model

Municipalities provides loans to homeowners to install solar PV systems which, can be

repaid over a long period, i.e., 15 to 20 years, through special property tax assessment

collected annually or semi-annually and is added on their property tax bills. Funding for such

projects is arranged through Long-term Bonds or through city's general fund.

Municipal Loan Programs

Following two municipal loan programs creatively leveraged existing programs to maximize

the resources to support sustainability. The first, the UVA Community Credit Union

PowerSaver Loan Program (a partnership between the Credit Union, the City of

Charlottesville, Virginia, and the Local Energy Alliance Program or LEAP), to provide

beneficial loan terms for participants. The second, the Milwaukee Solar Loan Program, was

established to bridge the financing gap.

Case Study: San Francisco, California - Assisting Neighbourhood Group

Purchases

San Francisco’s Department of the Environment in coordination with local communities

facilitated solar group purchases. Organizers from neighbourhoods, including Precita

Valley Neighbours (100 households), Cathedral Hill (4 multi-tenant buildings), and St.

Francis Woods (30 households) approached city for cheap prices form solar installers.

City also launched a program called One Block Off the Grid (1BOG) a program that

organizes residential group purchases of solar energy systems, to get its program started

in San Francisco. The city helped 1BOG prepare an RFP that went out to every solar

installers serving in San Francisco. Because of its success in San Francisco, 1BOG has

now been expanded nationwide.

Role of ULB: Local Government organises customer aggregation programs.

Benefits: It helps buyers to lower their up-front purchase costs for solar energy systems.

Solar for All

The non-profit San Diego Community Housing Corporation (SDCHC) partnered with a

third party - ‘Everyday Energy’, to put a 20-kW system on its Hacienda Town homes

property. Everyday Energy installed and owns the system on the 52-unit apartment

building, taking advantage of the tax benefits, which were otherwise not available to the

non-profit SDCHC. The non-profit SDCHC signed a 20-year Solar Services Agreement

with Everyday Energy under which they will pay a flat fee to cover maintenance and

electric services from the installation. An electric meter measures the energy flow directly

to the grid, and the utility (San Diego Gas & Electric) credits the tenants and common

areas as directed in the Virtual Net Metering agreement. It is projected that residents will

save 30% on their electric bills.



UVA Community Credit Union Power Saver Loan Program

City of Charlottesville first created an enabling environment aimed at sustainability,

environmental protection, and energy-related carbon reductions through local policy actions

such as:

2003: Passage of the Environmental Sustainability Policy

2006: City Council’s endorsement of the U.S. Mayors Climate Protection Agreement

2007: Delineating climate goals and objectives in the City’s Comprehensive Plan

2008: Completion of its first community greenhouse gas emissions baseline report

2009: City Council issuance of the “Green City” Vision Statement for 2025

Once an enabling environment was established, the City of Charlottesville attempted to spur

financing for distributed renewable energy installations through incentives for homeowners

and businesses. City granted funds to a local non-profit, the Local Energy Alliance Program

(LEAP) for setting up the loan programs with the UVA Community Credit Union.

City of Charlottesville originally granted the Clean Energy Loan Fund (CELF), to LEAP for

the installation of renewable energy and energy efficiency equipment on commercial and

non-profit properties. In addition to low interest loans, the city of Charlottesville also grants a

property tax credit for property owners who installs rooftop or ground mount solar equipment.

The credit is calculated by multiplying the current property tax rate by the system installed

cost and it is granted annually over a period of five years. At current tax rates, it equates to a

total benefit of 4.75 percent of the system installed cost.

Milwaukee Shines Solar Loan Program

Milwaukee’s solar loan grew out of the Milwaukee Shines Program, which is a joint project

between the city’s Environmental Collaboration Office and local partners. In 2013, to

accelerate its solar initiatives, Milwaukee Shines appropriated $100,000 of capital and

issued an RFP to lenders in the city to participate in a solar loan program. Summit Credit

Union eventually became the program partner. The program has produced a cumulative

portfolio of around 300 loans to date (around 500 kW of solar capacity).

Local Governments Supporting Local Energy Initiatives:

Local governments in Germany and Netherlands have promoted solar energy at local level

through local energy initiatives that aligned with the federal government’s energy and climate

change mitigation goals.



Case Study: Lessons from the Best Practices of Saerbeck (Germany)

Saerbeck, a municipality in the district of Steinfurt, in North Rhine-Westphalia, Germany

is seen as a role model for energy transitions at the local level. Residents of the district

approached the Mayor to install PV panels on the roofs of municipal buildings. Mayor

took an initiative and formed a team of skilled individuals, including engineers, scientists,

and economists as well as residents for this project. Municipality thus set a target of

becoming carbon neutral and fully energy sufficient by 2018. In 2008, Saerbeck

Municipality also participated in – German for Action Climate Plus, organised by federal

state of North-Rhine Westphalia. The Municipality won the tender and received 1.1 million

Euros and started activities such as goal setting, defining projects, initiating, organising

and supporting local energy initiatives.

Role of ULB:

Local support campaigns to persuade local citizens and create awareness.

Attracting RE firms from outside the Municipality.

Revenues of local energy initiative activities are used to invest in collective goals.

Outcome:

29 MW installed capacity of RE production (solar, wind, bio-energy)

Case Study: Lessons from the Best Practices of Lochem (Netherlands)

Municipality of Lochem started local sustainability initiatives by engaging local Residents

who requested for subsidy to the Municipality. Municipality approached the Central

Government, for the grant and Armhoede Sustainable Energy Landscape project was

established. With the active participation of citizens as well as local government’s

initiative giving its citizens the confidence to support local energy initiatives and drafted

vision document predicting the roadmap to achieve such goals, the Project became a

Success. The Municipality also formed a special team who had work experience in

international environmental NGOs, sustainability experts, etc. To attract more attention

and increase membership, a festival was organized in the central town’s church on

Sustainability Day, where prominent sustainable development advocacy speakers were

invited to promote the project.

Role of ULB:

Support by local government for local energy cooperative (e.g., in up-front investment

business case design) and other grassroots movements.

External networking to attract funding and innovative ideas to implement locally.

Incentives:

A start-up subsidy of 20,000 Euros to develop a sound business plan.

Outcome:

1 MW installed capacity of RE production (solar PV energy).

Solar park on rooftop of town hall.



5 RECOMMENDATIONS FOR ULBS FOR PROMOTION OF SOLAR ROOFTOP

PROJECTS

Government of India has taken up an ambitious target of achieving cumulative solar rooftop

installed capacity of 40 GW by 2022. Promotional and coherent policies at Central, State,

and Local levels, along with conducive regulations and incentives, are required to achieve

this gigantic goal. Identifying the key gaps in existing regulatory, policy, and incentive

framework, presently deterring large scale rooftop solar adoption at local level and

implementing mechanisms to alleviate these barriers will help ULBs promote rooftop solar

energy in their areas of operation.

As identified in Chapter 3, lack of - target setting, consumer awareness, finance,

coordination among government agencies are the key barriers for adoption of solar rooftop

projects. ULBs can follow a two-pronged approach to eliminate the constraints faced: first by

promoting and developing the solar rooftop market in their area by adopting specific targets,

launching awareness campaigns, designing specific programs and thus providing impetus

for private sector participation; second leading by example by installing rooftop projects on

their own buildings and building confidence in the technology. Few of the specific

recommendations are described in detail as follows:

Promotion and development of local solar rooftop market

This activity can be carried out by:

i. Organising and strategizing efforts for developing the solar rooftop projects

ii. Making the technology affordable by devising innovative financing mechanisms

iii. Lead by example with installation on own buildings

Organising and strategizing efforts for developing the solar rooftop projects

5.1.1 Create a Solar Advisory Committee or Task Force

Constitution of an advisory group or task force would help local governments understand the

perspectives of the various market participants involved in solar energy. This advisory

group/committee will help in getting nomination and concerns of all the local solar market

stakeholders and also designing an effective & holistic plan for growth of rooftop solar in the

area. Developing the strategic approach will help local leaders make the best choices for

their community. For e.g. in Saerbeck Municipality, Germany, a team of skilled individuals,

including engineers, scientists, and economists as well as residents were selected to

promote solar energy. Lochem Municipal Authorities, Netherlands also created a team of

international environmental NGOs, sustainability experts etc. to generate awareness and

capacity building.

5.1.2 Adoption of Solar Rooftop Targets

Setting solar rooftop specific targets or goals helps clarify the role solar energy will play in

achieving broader environmental, climate change, or sustainability goals in local

municipalities. It not only helps create momentum and provides motivation to work towards

common goals but can also aid in attracting the jobs and economic benefits at local level.

ULBs should adopt aggressive but realistic goals based on the available solar resource, the

local cost of electricity from the grid and the availability of local technology providers.



Renewable energy goal setting has helped cities and countries across the world to increase

their share of solar energy. For example, Saerbeck Municipality, Germany targets to be self-

sufficient in energy by 2018. Phoenix City Council, US in 2008 had set a target to use

renewable energy aiming at 15 percent of total energy utilized by the city to come from clean

energy by 2025. San Jose, California, US has set a goal of 100 percent renewable energy

by 2022 through municipal projects and policies facilitating solar rooftop on buildings owned

by both government and consumers. Denton, Texas, US is also working to achieve 70

percent renewable energy generation by 2019.

South Delhi Municipal Corporation (SDMC) has adopted a target of 20 MW and has signed

an agreement with Solar Energy Corporation of India (SECI) to install solar panels on its

buildings and vacant land to solar power with 25 percent subsidy from MNRE. New Delhi

Municipal Council (NDMC) has also adopted a similar target and has signed memorandum

of understanding with Energy Efficiency Services Ltd. (EESL) to install solar rooftops on its

buildings and supply solar energy at a pre-determined rate. The Chandigarh Administration,

on the advice of MNRE, GoI has initiated conceptualisation of a Master Plan to make

Chandigarh 100 percent Renewable Energy powered by 2030. Similar Master Plans are also

expected for other Solar Cities in the country.

5.1.3 Launching Consumer Awareness programs

ULBs identified lack of consumer awareness as a key barrier. ULBs can be instrumental in

generating awareness among consumers by developing programs and launching innovative

campaigns.

For example, SF Environment in San Francisco identified a lack of public awareness and

information about solar energy use in the city as a barrier to solar rooftop market

penetration. Therefore, a centralized website was developed where users can find the solar

potential of any rooftop in the city. Users can also evaluate the economics of using solar at a

particular site and find information and guidance for all the steps along the path to solar

installation and use.

Sacramento Municipal Utility District (SMUD) in California, US, followed a tiered-approach

for promoting consumer awareness and building consumer confidence in solar energy. In

India, Chandigarh Administration has launched a marketing campaign through various media

to generate awareness about the rooftop technology and the ULBs’ programs.

5.1.4 Including Solar PV Rooftop in the planning stage

MoUD, GoI has issued its model building bye-laws making solar rooftop systems mandatory

for building having more than 100 sq. m. area. ULBs can amend their building bye-laws and

include the mandatory provision for solar rooftop systems. ULBs can ensure enforcement

while issuing building approvals to the developers. For facilitating compliance, ULBs may

even assist the developers and direct them to the channel partners for installation of solar

rooftop on the buildings. ULBs can further develop some simple manual on how to install

solar PV rooftop systems on buildings11.

11

http://shaktifoundation.in/wp-content/uploads/2014/02/Meghraj-Guide-Book-NEW-layout-CP-14-07-2017-2.pdf





Energy Conservation Building Code (ECBC) was developed to target minimum energy

footprint from the buildings. Integration of ECBC with the building bye-laws and its

mandatory compliance can also be enforced by ULBs. The San Francisco municipal

corporation amended its green building code to mandate solar installation on newly built

roofs.

5.1.5 Designing Sector Specific Programs

ULBs can design specific programs for residential, commercial and institutional buildings as

discussed below:

Residential Program: Aggregating residential rooftop space and inviting bids on behalf of

the consumers from the eligible vendors/channel partners. ULBs should take the

responsibility of obtaining clearances and the subsidy. This would facilitate aggregation of

demand, better competitive rates, ensure standardised quality of products, thereby

facilitating higher participation from the residential sector.

Commercial and Industrial Program: Giving targets to the commercial and industrial

sector for solar rooftop, incentivising through rebates in municipal /property taxes, levies and

recognising the initiatives by giving awards.

Government and public buildings: Coordinating with specialised agencies like SECI to

invite EoI/RFPs on behalf of public buildings under the MNRE schemes or else enter into

MoUs with selected developers or PSUs like EESL for setting up solar rooftops on

government and public buildings.

5.1.6 Facilitating Residential Solar Group Purchases

As installed cost for smaller rooftop systems is typically higher, therefore, grouping

individuals into larger, aggregated purchasing pools can offer customers competitive price.

With help from technical advisors group purchase RFPs and contract templates can be

created and made available to these residents, which would also facilitate installation of

standardised and quality systems. Further, policy initiatives such as group billing and virtual

net metering if incorporated would result in a capacity addition at much larger scale.

In 2008, San Francisco targeted the 1,500 largest rooftops in the city when then-Mayor

Gavin Newsom challenged their owners to join the Mayor’s Solar Founders’ Circle by

installing a solar energy system by September 2009. Individual letters were sent notifying

building owners of their solar potential and the solar benefits they could enjoy based on

initial estimates to which many owners responded with requests for detailed assessments.

Complete analysis including roof area and solar exposure, and estimated the potential size,

energy production, cost, and payback for a solar system on each building was done. As a

result, this information helped building owners decide whether to move forward with a solar

energy system. Through this process, San Francisco identified a lack of financing options for

small to mid-size commercial solar projects as an additional barrier as most consumers cited

inability to bear upfront capital cost.



5.1.7 Addressing Multi-Tenant Barriers to Going Solar

Under existing net metering provision in our policies, generation and credit for solar energy

is available only to the premises where the solar rooftop system is installed. Therefore,

emerging models such as community shared model and policies such as group billing and

virtual net metering would facilitate installation of solar rooftop at multi-tenant level, thus,

allowing consumers with limited or no roofs to avail the credits against solar energy

generation elsewhere.

5.1.8 Creating an Online Platform for the Vendors and Consumers

ULBs can create a website and / or mobile app where the vendors can register and

showcase their product offerings for standardised systems with approved specifications. This

will result/help in boosting competition and the consumers will have an option to choose their

own optimum technology and vendors for them. At the same time, the website and / or

mobile app can offer consumers/building owners to register themselves or express interest

for setting up solar rooftop, thereby aggregating demand for ULBs for publishing RFPs or

facilitate vendors as well as banks to approach potential customers.

Making the technology affordable by devising innovative financing mechanisms

As upfront capital cost is a barrier for installing solar rooftop, especially to residential

consumers requiring small systems on their buildings. Therefore, to make technology

affordable various types financing mechanisms are required to address this issue. Following

are some of the ways to address this issue:

5.1.9 Convergence with existing schemes

MNRE is running several programs for solar rooftop installations. ULBs can co-ordinate with

the SNAs and channelize the benefits / subsidy directly to the eligible consumers or to the

local project developers installing systems on roofs of eligible consumer categories.

5.1.10 Property Tax Rebate

ULBs can provide incentives to consumers for solar rooftop deployment which can be in the

form of municipal / property tax rebates. Example of such incentives is mentioned in Amritsar

Cantonment Building Bye-Laws, 2017, where a building owner installing solar rooftop in the

building is entitled for a rebate in the Property Tax valid for three years. The amount of

rebate is decided by the board on case to case basis on submission of Energy Audit report

to prove that the energy consumption reduced.

5.1.11 Property Assessed Clean Energy Financing (PACE)

ULBs can also facilitate financing similar to that of PACE program which seeks to address

the up-front cost barrier for the residential consumers. In a PACE program, the city or county

finances the up-front costs of the investment, either directly or as an intermediary for private

investors. The property owner repays the loan over an extended period (10 to 20 years)

through a special property tax assessment.



5.1.12 Loan Programs

Municipalities can offer loan programs to address the barrier of upfront cost. For this,

municipalities can coordinate with financial institutions to lend money to consumers for solar

rooftop installations. This can be done through Interest Rate Buy-Down (IRBD) mechanism,

adopted in United States by municipalities, which allows lower interest rates to borrowers as

the additional burden is borne by municipality.

Leading by example with installations on own buildings

MNRE has scheme for the government and institutional buildings, ULBs can showcase their

initiative by integrating solar rooftop systems on their own buildings and properties such as

office buildings, hospitals, education institutes, water pumping stations. It is an excellent way

to ignite a local solar energy industry and build confidence of local area residents and

business owners in the solar energy systems. It will set benchmark for other stakeholders to

follow. Following activities can be undertaken by ULBs for installation on their own buildings:

i. Identifying the optimum locations and prioritizing sites for installations

ii. Invite proposals from eligible vendors or coordinate with specialised agencies like

SECI for the process

iii. Evaluate the optimum business model: CAPEX or RESCO

iv. Commission the system and ensure quality operations



6 WAY FORWARD

Government of India’s ambitious target of 40 GW of solar rooftop capacity by 2022 needs

concerted and co-ordinated efforts at all levels. This provides a compelling opportunity to the

ULBs to take leadership role in development of solar rooftop market in their local

communities as well as in installing the rooftop systems on their own buildings.

This discussion paper prepared under the USAID PACE-D TA Program is aimed to serve as

a Two regional workshops for stakeholder discussion is envisaged as the next step to

interact and deliberate on the challenges and opportunities for the ULBs in the solar rooftop

sector with specific and concrete suggestions for adoption. The stakeholder consultation is

envisaged to result in development of a practical guide-book for the ULBs for promotion and

furtherance of the local solar rooftop market.



About the USAID PACE-D TA Program

The USAID PACE-D TA Program is a part of the overall Partnership to Advance Clean

Energy (PACE) initiative, the flagship program under the U.S.-India Energy Dialogue. The

six-year program, implemented in collaboration with the Ministry of Power and Ministry of

New and Renewable Energy, has three key components: energy efficiency, renewable

energy and cleaner fossil technologies. The Program's focus is on institutional

strengthening, capacity building, technology pilot projects, innovative financing mechanisms

and increasing the awareness of clean energy technologies.

The overall aim of the PACE-D TA Program is to accelerate the deployment and use of

clean energy, expand U.S.-India trade and investment linkages, and facilitate exchange of

information and best practices. The Program works with policy makers, regulators, state

agencies, private companies, investors, clean energy associations, and other stakeholders

to create an enabling environment to increase the uptake of EE and RE technologies in

India.

Draft Issue Paper on Solar Rooftop Adoption by Urban Local Bodies: PACE-D Technical Assistance Program United States Agency for International Development Contract AID-386-

C-12-00001 Page 22

Annexure-1: Summary of provisions under Smart City Proposal and Building Bye-Laws

S.

No.

Name of

Smart City

State Target as per SCP Clause as per City Bye Laws

1 NDMC New Delhi 10% of energy requirement coming from solar, 40 MW grid

connected Solar PV target by 2020

As per Bye laws of Delhi, at least 1% of connected load

should be met from renewable energy for buildings with

built-up area above 20,000 sq.

2 Jaipur Rajasthan 15% of energy requirement coming from solar, Solar PV

Capacity target of 2.03 MW by 2019

In Rajasthan, as per the bye-laws which were originally

constituted in 2010, further amended in 2013 has only

provision of installation of solar water heaters. There is no

further amendment after 2013 in bye-laws.

3 Pune Maharashtra 10% of energy requirement coming from solar, As per

survey 176 acre rooftop space available in ABB area

As per Development control & promotion regulations, 2017,

for Pune Municipal Corporation, at least 25% of area of roof

area shall be utilised for RTSPV installation

4 Ludhiana Punjab 10% of energy requirement coming from solar, Formulation

of Solar city cell, DPR to identify locations

5 Dehradun Uttar Pradesh 10-15% of energy requirement coming from solar, Rooftop

space available approximately 40,000 sq. Ft in ABD area

UP amended its bye laws in 2016, As per bye laws at least

25% of area of roof area shall be utilised for RTSPV

installation for buildings above 5000 sq.

6 Dharamshala Himachal

Pradesh

10% of energy requirement coming from solar

7 Amritsar Punjab 10% of energy requirement coming from solar

8 Kanpur Uttar Pradesh 10% of energy requirement coming from solar, 21544.35

sq. m. rooftop area on 39 buildings in ABD that would

generate around 2.61 MU/year




9 Jalandhar Punjab 10% of energy requirement coming from solar As per Building Bye laws 2010, there is no provision for

rooftop solar installation

10 Thane Maharashtra 10% of energy requirement coming from solar, 2 MW solar

rooftop plant at stadium and water treatment plant on PPP

mode

11 Vadodara Gujarat 10% of energy requirement coming from solar As per General Development Control Regulations dated 15-

06-2016, there is no such provision for Solar PV rooftop

installation

Draft Issue Paper on Solar Rooftop Adoption by Urban Local Bodies: PACE-D Technical Assistance Program United States Agency for International Development Contract AID-386-

C-12-00001 Page 23

S.

No.

Name of

Smart City

State Target as per SCP Clause as per City Bye Laws

12 Udaipur Rajasthan 15% of energy requirement coming from solar, 15 MW

generation by three years

In Rajasthan, as per the bye-laws which were originally

constituted in 2010, further amended in 2013 has only

provision of installation of solar water heaters. There is no

further amendment after 2013 in bye-laws.

13 Ahmedabad Gujarat 10% of energy requirement coming from solar As per General Development Control Regulations dated 15-


installation

14 Surat Gujarat 10% of energy requirement coming from solar, 1 MW Solar

PV plant to be set up

As per General Development Control Regulations dated 15-


installation

15 Faridabad Haryana 10% of energy requirement coming from solar

16 Chandigarh Punjab &

Haryana

10% of energy requirement coming from solar, Rooftop

capacity of 6.5 MW installed on 134 Govt. buildings, 15 MU

generation will meet 10% target(150 MU consumption of

ABD), Already 1.6 MU is being generated, additional 13.4

MU required means 10.3 MWp capacity required

17 Lucknow Uttar Pradesh 10% of energy requirement coming from solar, 1.281 MW

capacity to be added, will generate 2150799 kwh(current

0kwh)




18 Jabalpur Madhya

Pradesh

10% of energy requirement coming from solar

19 Allahabad Uttar Pradesh 10% of energy requirement coming from solar, 5MW

proposed




20 Karnal Haryana 10% of energy requirement coming from solar, 1 MW on

existing public buildings, 4MW in new redevelopment

projects, 0.1 MW in redevelopment projects, will generate

12% of energy consumption in 2021

partnership to advance clean energy - pace-d · amritsar cantonment board has included a clause in...

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