The solar industry which has immense potential for a tropical country like India
where around 25% of house holds in rural areas, do not have access to
electricity (24x7), says our new research. In January 2016 the Prime Minister of
India Shri Narendra Modi, and the President of France Mr François Hollande laid
the founding stone for the headquarters of the International Solar Alliance
(ISA) in Gwalpahari, Gurgaon. The ISA will focus on promoting and developing
solar energy and solar products for countries lying wholly or partially between
the Tropic of Cancer and the Tropic of Capricorn. The alliance of over 120
countries was announced at the Paris COP21 climate summit. One of the hopes of
the ISA is that wider deployment will reduce production and development costs
and so facilitate increased deployment of solar technologies, including in
poorer and more remote regions. A glimpse at the table below will give you an
idea of growth.
 The
industry supposed to have rapid growth over the past few years and is projected
to grow further in future is actually not able to incre the pace of growth down
mainly due to REC & RPO obligations.
Although MNRE was setup the with view of providing a level field and increase
Domestic Content Requirement, (DCR), The domestic cell available today is
inferior in quality, thus effecting the quality of modules as compared to
Germany, Taiwan and to some extent China. Also the cost differential is high on
domestic modules. This is where Govt. wants bring in anti dumping laws, which
are opposed By EPC companies while welcomed by Panel manufactures. Most of the
Indian Panel manu-facturer are using imported cells. Except for those required
for DCR compliance.
Recently SWELECT became the first company in India to execute 10 MW
Domectic Content Requirement (DCR) project.
The report provides an insight on various Major Panel manufacturers in India,
various small & Mid level companies forming the major chunk of solar industry in
India. It thoroughly examines current industry trends, with focus on recent
changes in the state and country level regulatory environment. The report will
assist investors to understand the market dynamics and get an insight into the
future outlook of solar power market in India.
Many states have started promoting solar based applications by giving incentives
and tax savings. States like Gujarat and Rajasthan have formulated transparent
and progressive regulatory framework in order to boost the solar industry.
Besides, states like Tamilnadu, Uttar Pradesh, West Bengal, Maharashtra and
Chandigarh are promoting solar energy in rural, urban and semi urban areas. More
recently Madhya Pradesh has joined the Solar Promotion bandwagon. The forecast
given in this report is not based on a complex economic model, but is intended
as a rough guide to the direction in which the market is likely to move.
Here is a brief of what various states have achieved :
 GUJARAT
: 1023.30 Mw of solar projects have been installed under the Gujarat state
solar Policy, with many project delayed. Though Gujarat announced tariffs for
2016-18, which are about 20 per cent lower compared to 2015 tariff levels. it
does not have any plans to announce any targets or installation goals. The State
of Gujarat has commissioned Asia’s largest solar park at Charanka village. The
park is already generating 2 MW solar power out of its total planned capacity of
500 MW. The park has been functioning on a multi-developers and
multi-beneficiaries paradigm and has been awarded for being the most innovative
and environment-friendly project by the CII.
With a view to making Gandhinagar a solar-power city, the State government has
launched a roof-top solar power generation scheme. Under this scheme, the State
plans to generate 5 MW of solar power by putting solar panels on about 50 state
government buildings and on 500 private buildings.
KARNATAKA : To achieve commercial viability and expeditiously
operationalize the Renewable Energy Projects. to enhance the contribution of
Renewable Energy in the total installed capacity of the state to about 2400 MW
by 2018. There are no updates as to whether PPAs were signed or if financial
closure was reached. The Karnataka Renewable Energy Development Agency has also
submitted recommendations to the state to develop 1.000GW of Solar Energy in
five years or 200MW per year. KREDL willing. However slowdown is visible as only
78.22Mw was commissioned in 18 months ending Sept, 2015.
RAJASTHAN : The state of Rajasthan has installations of completed 1295 MW
of solar projects currently. The tarhet is acieve around 2000 MW by March 2017,
which seems dificullt
ORISSA : The Orissa Renewable Energy Agency (OREDA) called for tenders
auctioned off a 54MWp. The project includes Installation of Grid Connected
Rooftop Solar Photovoltaic Power Plants with aggregate 54 MWp capacity in
various districts across the state on Pilot basis. The project aims to reduce
the fossil fuel based electricity load on main grid and make the buildings
self-sustainable to the extent possible. Projects can be set up on the concept
of Net Metering/ Feed-in-Tariff on Pilot Basis. The individual project will
normally range from 10 kW to 500 kW size. The projects below 10 kW may also be
considered for residential sector. OREDA plans to call a tender to develop
another 45MW in the next few Months.
MADHYA PRADESH : Madhya Pradesh Power Management Company Limited has
recently signed PPAs for 225mw of PV projects with five project developers under
a reverse auction mechanism. Those going in for MNRE subsidy were in for a rude
shock as subsidy schemes were discontinued and crore & cores of money of various
company got stuck. There is an utter confusion as customer still sites MNRE
guidlelines where vendor wondor how to convince. The Welspun Solar MP project,
the largest solar power plant in the state, was set up at a cost of 1,100 crore
(US$160 million) on (3.05 Sq KM) of land and will supply power at 8.05 kWh. A
130 MW solar power plant project at Bhagwanpur in Neemuch was launched by Prime
Minister Narendra Modi. This is the largest solar producer and one of the top
three companies in the renewable energy sector in India.
An upcoming 750 MW solar power plant project in Madhya Pradesh in the district
of Rewa will, when completed, be the world's largest solar power plant,
replacing the Desert Sunlight project in California which currently has that
distinction.
MAHARASHTRA : Maharashtra State Power Generation Company
Limited(MahaGenco) has 150MW of solar power projects under development by three
companies. State plans to develop a 100MW project in Usmanabad district, 25mw in
Parbhani district and 125MW in Yavatmal district are in advanced stages of
planning.
Solar market too has become highly fragmented both product-wise as well as
number of companies jumping into the Solar bandwagon.
Vikram Solar completed 5MW in Tamilnadu in a record time. Vikram Solar has
just completed 50MW in Tamilnadu in a record time. Vikram is working on the
technology where by the DC to AC conversion can take place module level itself.
These module have been successfully tested and are currently under going burn
test at their own setups. 1500 Watt panel, which they say can be used as roof.
Waaree Energies Ltd., a Mumbai based PV Manufacturer has taken huge projects in
Gujarat and have started acquiring smaller solar companies having strong Solar
experience.
Swelect Energy Systems Ltd, formerly Numeric Power Systems Ltd, a BSE listed
company sold of its UPS Business Unit for over 850 crores to concentrate on
Renewable Energy, space. In just a few months the company has set up and
commissioned two solar Power Plants and a Wind Power Plant and has over 2000
rooftop installations to its credit. The company has accquired HHV Solar, a
reputed SPV Panel manufacturer and has invested heavily on increasing the plant
capacity from 35Mw to 100Mw.
Emmvee another panel manufacturer is planning for Solar cell manufacturing of
500Mw, Module expansion plan of 1000 Mw & project development and EPC
implementation by 1000 Mw by 2019.
Innovative Solar is in the process expansion as it has come up with 300 Watt
modules which are very sturdy and have very high yield these modules come up
with IEC certifications.
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Demand for solar products has been rapidly rising over the years,
especially in rural areas, and is expected to continue growing
exponentially during our forecast period (2016-2017). Solar PV Off-grid
applications, Roof Top applications and even Megawatt sized Solar Power
Plants have started coming up although not at the same speed as
initially thought. MNRE though initially announced subsidy and made
every body was lured. By abolishing subsidy since Aug 12, 2014, it has
come back to haunt the companies.
Orders taken prior to that date are now held. Chaotic situation is
spread amongst the masses, because of lack of clarity. User still
believes there is subsidy and feels that the Solar companies are
cheating them. All Solar street lighting systems projects, home lighting
systems, power plants, solar-cookers and solar pumps are being kept on
hold for lack of clarity applications in India. Finally India has well
crossed the 8 Gw as on July 2016. By March 2017 we expect the SPV
installation to cross 9Gw, however Govt. ambitions of 40 Gw by 2020
remains a distant dream.
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Indian PV module & cell manufacturers have an obvious disadvantage
against Chinese players in terms of scale and govt. assistance. Due to
these factors, the imports from China are somewhat cheaper than
domestically manufactured goods. While Indian PV modules manufacturers,
such as Microsun, are thriving in spite of this price gap due to better
quality and better service support, the Indian cell manufacturers are
not doing so well and the domestic PV cell manufacturing is pretty much
at a standstill.
On hurdle faced while implementing major projects : For MW scale
projects, the initial hurdle is land acquisition and registration. Some
states (e.g. Rajasthan) have created a single window clearance which
simplifies the process. However, in majority states, you still have to
deal with the bureaucratic hurdles. The next challenge, for both Mw & kw
scale projects is power evacuation. Also policy implementation issues
around forward looking policies like the REC - RPO mechanism but the lax
attitude of the state governments towards strictly enforcing the RPO
mechanism has led to a situation where the REC market has not been
successful so far. Once the state governments start strictly enforcing
the RPOs, there will be a demand for the RECs which will create the
demand for solar power as envisaged.
Better infrastructure, arrangements & models to spur the photovoltaic
industry and consumption of the PV products. Net Metering needs to take
of in a big way, this will allow people to have their own Rooftops to
generate power for their own good.
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Being the leading brand in Solar PV module manufacturing in India, we
aim to positively move forward towards maximum solar production capacity
through constant development and use of innovative technology in this
field. We are coming up with new technology called ‘Merlin’ for Modules,
which would increase the applications of Solar PV. We are also in the
process of getting all the latest certification requirements from
various International Markets for new products such as higher system
voltage, Fire class etc. Currently, our solar capacity production is 500
MW and we are planning to expand it by up to 1000 MW by the end of 2016.
Ever since the arrival of Modi Government, the solar energy sector in
India has boomed in past couple of years. However, at the global level
India is still a lightweight market, especially when compared to
established nations in this realm like – the United States, Germany and
China. This certainly poses a challenge for a developing country like
India as it needs to step up and upgrade its solar energy manufacturing
capacity to gain prominence among such major players. This is a welcome
move by MNRE as it enables positive growth of domestic solar module
manufacturers in India as well as ensuring proper usage of domestic
solar materials. Although most states have not taken any actions on this
front, there are some who have begun to incentives these manufacturers
in various ways like providing land for international solar
manufacturing plants.
Over the last century, the energy storage industry has continued to
evolve and adapt to changing energy requirements and advances in
technology. Energy storage systems provide a wide array of technological
approaches to managing our power supply in order to create a more
resilient energy infrastructure and bring cost savings to utilities and
consumers. If one looks at the developments happening in energy storage,
it’s very encouraging. Battery storage has emerged from the fringes of
the power sector to challenge both industry conventions and traditional
generation.
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Softdisk by its conservatives estimates, believes that 40 GW
opportunity till 2020 is the most likely scenario . The Indian solar market is a
key future growth market for PV.
India’s installed capacity as of quarter ending 31st July 2016 was 8.06 GW,
which is still negligible as compared to more mature markets such as Germany.
However, the first two quarters of 2016 alone have seen additions of 530.27 Mw
to Indian PV installed capacity, more projects are unde completion.
According to Softdisk report Tamilnadu as 30 September 2016, with a total
installed capacity of 2100MW has become the state with largest installed
capacity. Not reflected in our table, as it is up to 31st July 2016.
 There
are also external factors in India challenging its solar industry, namely high
inflation and consequently high interest rates, slowdown in GDP growth, a
several depreciated rupee and relentless corruption scandals of the previous
Govt. Low bids with high interest rates in the range of 13 to 15 per cent make
it challenging to borrow in India. Most Indian Banks look at these projects as
risky and look into it only after land acquisition and registration & PPA.
Statutory approval are completed & the number of successfully executed quality
project that can last 25 years.
Softdisk believes that the Govt. & regulators must :
- Develop renewable Energy Laws mandatory.
- Set-up standards for renewable energy.
- Conducting resource assessments.
- Supporting research and development activities thru investments.
- Early timing of policy announcements and ease of implementation.
- Addressing concerns relating to enforce-ability of PPAs.
- Banks to brought in loop for financing Solar projects with renewable
energy purchase obligation.
These changes will allow make in India a Roaring Tiger.
The coming year will see some movement and interest by market players to explore
new business models/segments within the solar industry in India. Further, the
falling cost of solar will lead to new projects in the captive commercial space
as solar tariffs become competitive with commercial and industrial grid prices
in various parts of the country.
The rating does not include major EPC players such as BHEL, ADANI SOLAR,
WELSPUN, BEL, CEL, TATA Solar, BOSCH, Solar Semi-conductor & Moser Baer India
Limited, LANCO, L&T, INDO SOLAR, Reliance Power, Mahindra Power, Wipro-ECO which
have diversified interest etc.
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