Renewable Energy in India: addressing future opportunities for companies.
As we are fast venturing into the energy climate era & there is a growing concern of rise in global average temperature which in turn is becoming disastrous day by day. So every country is looking into renewable sources of energy addition as an important factor for their economy & climate. Renewable energy sector in India is far lagging behind in terms of utilization of solar or wind potential due to non deployment of large scale solar or wind power plants .The main reasons for this is lack of proper planning, lack of effective subsidy schemes, land acquisition problems (large scale solar or wind power plants require huge land) & bottlenecks faced by companies to recover the subsidies announced by government. The electricity sector in India had an installed capacity of 223.343GW as of March 2013, the world’s fifth largest. Captive power plants generate an additional 34.444GW. Non renewable power plants constitute 87.55% of the installed capacity & 12.45% of renewable capacity.
A new World Bank program known as renewable energy mapping program will carry out mapping of renewable energy resources that will for the first time produce rich, nationwide data for each country. Coordinated and financed by the World Bank’s Energy Sector Management Assistance Program , the initiative will cover mapping of solar, wind, biomass, and small hydro-power potential.Thus the government will be able to view the granular data to understand it’s solar or wind potential which till now is underutilized. India’s cumulative grid tied renewable energy capacity (excluding large hydro) stands at 26.9GW,of which 68.9% comes from wind making India fifth largest in wind. Solar PV contributes 4.59% to the total renewable energy generation.
In December 2011, over 300 million Indian citizens had no access to electricity. Much of India doesn't have an electric grid which provides scope for distributed power systems which are grid independent and small. Due to rapid economic expansion, India has one of the world’s fastest growing energy markets. Limited domestic fossil fuel reserves & the environmental constraints put up by the dirty fuels is witness to the future renewable energy prospects in India. The development of grid interactive renewable power took off with the coming into force of the Electricity Act 2003, which, among other things, provides for regulatory interventions for promotion of renewable energy sources through determination of tariff, Specifying renewable purchase obligation (RPO), Facilitating grid connectivity, Promotion of development of market.
The international energy agency estimates that India will add between 600GW to 1200GW of additional new power generation capacity by 2050.India is most active player in wind power sector & a rich destination for companies wanting to acquire wind power assets. The national solar mission, under the National Action Plan on Climate Change aims to add 20,000MW of solar power by 2022.Indian solar panel manufacturers are dominated by cheap export from China, Taiwan, Malaysia, and USA.India has been ranked as 7th in solar photo-voltaic cell production & ranked as 9th in solar thermal power generation. This growth is exponential due to several private players entering the business and various subsidies & reforms put up by the government of India.
The major players in solar power are as follows.
Moser Baer Photovoltaic Limited, Tata BP solar, photon solar energy system, HHV solar technologies private Ltd,Titan energy systems Limited, Sun energy systems, Applied materials, signet solar,Punj Lloyd delta renewable, Bharat Heavy Electricals Ltd,Reliance industries limited etc.
In March 2007 the Indian government announced a semiconductor policy under its Special Incentive Package Scheme (SIPS) which will provide 20% of the capital expenditure during the first 10 years for semiconductor industries, including manufacturing activities related to solar PV technology located in Special Economic Zones (SEZ) and 25% for industries not located in an SEZ. India has among the highest solar irradiance in the world which makes solar PV all the more attractive for India. Odisha and Andhra Pradesh also houses some of the best quality reserves of silica (basic feedstock for metal grade Si). India has demonstrated globally proven metallurgical processing capacities and capabilities. India is already an established low cost producer and assembler of solar PV cells and modules. The major barrier for solar projects is their high upfront costs while putting up the project. Companies around the world are planning & developing production facilities that run into gig watts while India has not yet put enough on R & D for implementation of such projects. While it is obvious that to keep in pace with the growing economy India will add renewable assets to utilize its wind & solar power fully.
Wind power plants face land acquisition problems as well as the reduced subsidy & high operation costs are driving large companies to sell off their wind energy assets, which is non-core for them, to renewable energy based companies. As far as hydro sector is considered it is facing several issues like long wait for forest & land clearances, inter state disputes on water sharing, inadequate transmission capacity, large construction periods & geological surprises as in Uttarakhand tragedy.
Thus as the Indian society is getting more aware of the clean fuel compared with the bad carbon footprints left by fossil fuels the renewable energy sector in India is confident & poised for growth.