Rooftop PV could reduce the capital’s power costs and improve its supply security. These are benefits typically associated with solar. However, the real benefit might lie in reducing Delhi’s chronically high levels of smog. We are only just beginning to understand the economic (let alone social and political) cost of excessive pollution. A look at China helps.

• Smog in Delhi has reached extremely hazardous levels
• Beijing has comparable problems with smog and is paying a huge economic prize
• Policy interventions have worked for Delhi before – solar could be the next step

Delhi’s smog has become a winter scourge. According to an estimate, the deaths of over 10,000 a year are attributable to the bad air quality. Levels of P10, a measure of particulate matter, has in the winter months reached 749 – more than seven times the safe limit. P2.5 has reached 489 or more than eight times the safe limits. Some causes are found within the city (rapidly increasing car traffic, burning of wood, diesel back-up gen sets, coal fired power plants), some are outside of the city (burning off of agricultural residues, industrial air pollution). Meteorological factors play a role too.

The only city that might consistently be scoring worse on the smog index than Delhi is the Chinese capital of Beijing. According to the World Bank (refer), environmental pollution costs China as much as 5.8% of GDP. The costs of air pollution alone are estimated at around 3.8%. They include: healthcare costs, damages to materials, car accidents and flight cancellations. As a result, China plans to invest over USD 500bn into environmental protection until 2015. Experts believe that this is still insufficient: as much as 4% of GDP or more than USD 300bn would be required each year. This is just the economic cost of pollution.

In addition, there is the issue of quality of life. As Delhi will continue to grow and its citizen become wealthier, they will demand better air quality. This will become a political issue. China shows the way. According to a Gallup survey of December 2012, 57% of Chinese already agree that environmental protection should be given priority even at the expense of economic growth. In India, the number is at 45% (refer).

10 years ago, Delhi managed to significantly reduce pollution levels through strong new policy measures, enforcing structural changes and the adoption of cleaner technologies. Today, it could do so through e.g. reducing diesel subsidies, providing more public transportation, moving brick-kilns away from the city, or paving all roads to reduce the dust levels.

Solar could also play a significant role in the transition to a more environmentally sustainable, economically efficient and politically acceptable path to urbanization. Making the use of rooftop PV mandatory for certain building owners or power consumers would reduce the pollution from generator sets as well as from coal-fired power plants. There would be less smog. Today this sounds like a choice. Soon it might become a non-negotiable political demand and economic necessity.

The power tariffs in Delhi for commercial customers are at 8.3 INR/kWh – a price that can already be matched by solar PV (100 kW) installations if storage is not included. PV would be a complementary power source. Storage could become viable, if a 20% increase in tariffs (demanded by utilities), the cost of power stored in inverters (20-50% higher due to inverter inefficiencies) or diesel back-up costs (anywhere between 12-20 INR /kWh) are considered. Residential consumers, currently paying only INR 6/kWh might also turn to solar soon. The government can accelerate a transition to solar in Delhi by providing subsidies, by allowing for regulatory improvements such as net-metering or buy granting tax advantages (e.g. on VAT). Any additional cost for solar power to the government and to the public should be more than outweighed by the environmental cost of not reducing smog levels in Delhi.

BRIDGE TO INDIA and Greenpeace are currently exploring the case for solar rooftop PV in Delhi and will be publishing a joint report soon.

Tobias likes to write about solar business models, solar and energy policy and wider issues of sustainability, development and growth.

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