BSES Yamuna Power Limited, with its large share of residential consumers, has found that it needs to make innovative business interventions to increase the pace of solar deployment in its license area. Given its consumer mix and the dominant building types in its license area, the community solar model, the on-bill financing model, and the solar partners model are the three business models that could aid the utility in achieving this objective by addressing the market challenges in the sector.

While the community solar model provides a way for households living in apartment buildings with shared roofs or with no roof access to receive the benefits of a RTS system through a shared system, the solar partners model allows even tenants to subscribe to solar energy for shorter periods. Both models benefit from the availability of large roof spaces in public and private buildings and pass on the benefit to residential consumers. The on-bill financing model, on the other hand, targets consumers with roof access and who need access to easy financing. Thus, the combination of the three models extends the rooftop market to all the residential consumer segments.

The business models that are quite feasible for consumers in the higher consumption slabs in the present market conditions will need additional provisions like differentiated solar tariff to ensure that they are feasible for all consumer segments. The current tariff structure for the domestic consumers in Delhi play an important role in determining the economic viability of these business models to different consumer segments. The recent tariff revision and the existing 50 per cent additional subsidy on energy charges for consumers under 400 units slab are two factors that have deemed solar rooftop unattractive for the consumers in those slabs. In the revised tariff structure for the financial year 2018-19, the fixed tariff was increased up to 2 - 5 times while the energy charges were reduced by 11-25 per cent for various slabs. This would help the DISCOMs reduce their losses from consumers switching to solar as they are now able to recover more money through the fixed tariff which the consumers pay irrespective of solar generation. But the reduced energy charges have considerably reduced the savings consumers could have gained with net-metered RTS. Additionally, the 50 per cent energy tariff subsidy reduces the per unit average tariff of the consumers to as low as INR 1.7/kWh (including tax and surcharges) which are incomparable with the rooftop solar tariffs.

Ideally, the involvement of DISCOMs through the business models discussed here should help in bringing considerable system cost reduction. When the DISCOMs undertake consumer and site aggregation, the developers would be able to save on their sales and consumer acquisition cost which should reflect in the final prices. DISCOMs conducting reverse auctions in community solar subscription or solar partners model can also help in realising lowest possible subscription tariffs. Therefore, with the trend of decreasing prices of solar systems and the possible cost reduction that could be achieved through economies of scale and interventions by the utility, the financial attractiveness of the business models will only improve.