Land bottlenecks drive CPSUs to team up with states for 33 solar parks

Public sector companies such as National Hydroelectric Power Corporation (NHPC), Satluj Jal Vidyut Nigam (SJVN), and NTPC Green Energy Ltd (NGEL) have floated such state-specific JVs to set up solar projects across the country, as this newspaper had earlier reported. Under the JV model, state governments take equity stakes and, in return, facilitate land availability for project development.

This land issue has also drawn parliamentary attention. Earlier this month, the parliamentary standing committee (PSC) on energy noted that the land suitable for solar projects often overlaps with agriculturally productive or ecologically sensitive areas, putting it in direct competition with food security and conservation needs.

The ministry also said that it has, in consultation with state governments, identified and declared renewable energy potential zones of around 258 GW across five states, beyond the Central Electricity Authority’s (CEA) 500 GW transmission plan. However, it refrained from providing further information on the same.

Partnering with state governments

These projects have come up under the “Development of Solar Parks and Ultra-Mega Solar Power Projects” scheme, which encourages states and Union Territories to prioritise government-owned waste or non-agricultural land for setting up solar parks, MNRE said.

Launched in 2014, the scheme has approved 55 parks with a combined sanctioned capacity of nearly 40 GW across 13 states till October this year. Of this, around 14.9 GW has already been installed, while the remaining capacity is at various stages of implementation.

“Under this scheme, many CPSUs have partnered with the State Governments and their PSUs, for easing the land identification and acquiring process,” the ministry said.

Since land is a state subject, the responsibility of identifying suitable land for renewable energy projects rests with state governments. The MNRE said it has been writing to states and Union Territories on multiple occasions for the identification of suitable land for solar and renewable energy projects and for relaxation in land-use rules, including exemptions from non-agricultural land conversion requirements.

Most of the renewable energy projects are done by private developers who are responsible for identifying and acquiring land — either revenue or private land — for their projects. However, MNRE said it has been engaging with state agencies to expedite the allocation of revenue land based on the request from developers.

On long-term solutions, the ministry suggested that state governments could declare details of unallocated revenue land suitable for renewable energy development. It also suggested easing land rules like exempting non-agriculture land conversion or deemed conversion.

Land acquisition challenges

Land acquisition is one of the important steps in the timely development of utility-scale solar projects as it requires vast tracts of contiguous land. A utility-scale solar installation typically requires around 4-7 acres of land per megawatt (MW). As per MNRE’s estimates, there will be a requirement of between 1.4-2 million hectares of land to harness the country’s full potential.

However, non-availability of the required land or delays in land acquisition have become a major bottleneck in realising the country’s solar capacity. In its recent report, the parliamentary standing committee on energy noted several challenges related to land acquisition for large solar projects. These include fragmented land ownership, legal hurdles associated with compensation and levies, lack of contiguous land parcels near existing grid connectivity, and inadequate grid connectivity in areas where suitable land is otherwise available, among others.

In its recommendations, PSC called for the creation of a ‘single-window clearance mechanism’ bringing together all relevant central and state stakeholders. Such a mechanism, it said, would help identify land-related issues early and ensure their resolution within defined timelines.