The Indian solar market has been growing very fast, but analysts feel infrastructure including adequate grid connection and other associated systems have not kept pace with auction announcements and it could lead to idle capacities.
A situation that California in the US has already started to face. According to the Institute of Energy Economics and Financial Analysis, California has started generating so much solar power that grid operators are being forced to switch off solar farms.
One solution experts says is to wheel the excess power to other states. That, however, is not possible because California's power system works more like an island and its grid is incapable of wheeling out the power to other states.
In India, there are instances, especially in Tamil Nadu where solar power generators have commissioned plants but these cannot run because they do not have grid connectivity. The capacities are lying idle.
Raj Prabhu, CEO and Co-Founder of Mercom Capital Group said: "Solar power surplus could become a problem in the future in short periods of time as generation continues to expand and is concentrated in certain regions. Solar generation peaks in the afternoon whereas peak demand occurs during the evenings. Regions which have surplus generation must be able to export excess generation and have a robust power trading mechanism without which we will see problems that we have seen in many parts of the world."
A senior analysts said: "Transmission constraints have been affecting regular power movement from Western India to South which faces excess demand on a regular basis. Despite new capacities for wheeling power from West to South, prices of power for South India remains higher than the national average at exchanges due to transmission issues."
Prabhu said: "In our recent India quarterly report, we mentioned that India is not yet ready to go from a 2 GW to a 10 GW a year market as infrastructure, including the grid, is lagging behind auction activity. Battery and storage can be the solution but the technology is still in early stages."
"Nevertheless, California, has started to auction storage projects as a solution to their short-term solar surplus issues along with developing an 'energy imbalance market' with neighbouring states to balance demand during short intervals of surplus generation," he said.