JNNSM
February 10, 2011
European companies have largely been absent in the Indian solar energy scene except for Siemens,Areva which are moving aggressively in the whole green energy sector.Note US and Chinese companies have already established solid beacheads in the country.India's solar energy sector is poised for exponential growth in the coming decade further boosted by JNNSM.European home markets are maturing for European companies and India is the rising star,so it is essential that the sales teams of the Europeans get in early.Schott Solar is one of the biggest manufacturer of solar panels in Germany.Though not big on the world stage,Schott Solar is present in large parts of the Solar PV and Solar Thermal Supply Chain.It recently established a JV with Chinese company Hareon and plans to build 700 MW of solar panel capacity in emerging markets around the world.It has won a contract to supply 20 MW of thin film modules to Indian Solar Company Premier Solar with 10 MW of supply in 2010 and 10 MW in 2011.Note Premier Solar is a small company and seems they are building the 20 MW for a state government and not under the JNNSM scheme.Note,Schott is not a big name in solar either and its thin film modules are certainly not famous either so makes a good combination.Solar Energy in India finally sees entry of European companies Abengoa and Schott
January 13, 2011
The Indian Solar Energy Policy JNNSM has been beset with more than its fair share of problems even before completing its first phase.Despite amibtious plans to set up 20 GW of Solar Energy Capacity by 2022,the Policy Support and Subsidy has come under fire from all directions.The First Phase of JNNSM has auctioned 150 MW of Solar PV Capacity to 30 Developers in blocs of 5 MW each.This led to irrational bidding by mostly unknown and bit players which has led many to question to the ultimate viability of these projects.Note the Solar Thermal Bidding has been equally as disastrous with bidding leading to very low tariffs for the winning developers.
December 15, 2010
USA has opposed India’s Local Content Requirements for the Federal Solar Energy JNNSM program.Note according to the JNNSM rules,solar panels will have to be produced in […]
December 14, 2010
Asian Development Bank (ADB) may rescue the JNNSM process which seems to be headed for certain problems.The Bank is committing to provide loan guarantees for under 30 MW projects to Indian Banks and upto 25% equity investment into >30 MW projects.Note debt financing is a major issue which was talked about by the biggest Indian utilities for not participating.Note ADB has already committed to setting up 500 MW Renewable Energy Capacity in India in JV with NTPC.This will further increase ADB's exposure to Solar Energy in India.It remains to be seen if ADB give equity and debt to many of these projects which don't seem to be feasible at these prices.Will ADB willing to take losses in these ventures and provide loans to many of these unknown firms with no track record.
December 13, 2010
Note both the Solar Thermal and Solar PV Project bidding have led to grave doubts about how these solar plants will be implemented.Not only are the firms small,unknown with little project experience but they have also bid for feed in tariffs which would definitely lead to losses.According to MNRE,the government also plans to make the local domestic content requirements more stringent.The requirements will be extended to solar inverters as well and the provisions may not stop at 2013 but will go beyond as well.Note the JNNSM mandates that modules for solar energy be made in India in the first year and both cells and panels be made in the 2nd year.This is important for the growth of solar energy equipment manufacturing in India.This has been successfully used by both China and Canada to foster the growth of the green industry in their domestic market.However it has the side effect of raising prices and increasing inefficiency as they would lead to higher costs.They could also lead to the gaming of the system particularly as India is highly corruption prone country.
December 9, 2010
Solar Energy in India at the Federal Level is facing massive problems but the state level initiatives are pushing ahead.Gujarat has been at the forefront of promoting Solar Energy recently setting aside a 3000 acre site for 500 MW of Solar Power Generation.First Solar,the Cd-Te Leader and Producer of the largest number of Panels in 2009, has got an order from Acme Telepower for 15 MW Plant to be constructed in March 2011.Note First Solar is the also the lowest cost producer of solar panels in the world currently and looks to be so in the foreseen future as well.First Solar is expanding capacity by almost 50% in 2011 after a slow 2010 and looks upon India as one of its most important markets.
December 8, 2010
The biggest problem is that the winners of the Solar PV Projects are mostly unknown small firms who have bid so low that make the returns negative for investors according to the renewable energy ministry officials (MNRE).Bidding has gone as low as 23c/Kwh which is crazily low considering the debt costs in India are as high as 13% annually.Compare that to China where debt is priced as low as 3-4% and the winners are huge utilities.With even India's Tata Power saying that the projects are not bankable as their is confusion how the electricity tariffs will go to developers,its difficult how these unknown firms could manage the financing .While the companies will lose their bid deposits if they don't finish the projects,Indian Solar Energy will be the biggest loser as the failure of the Phase 1 of JNNSM of 1000 MW by 2013 will lead to even further delays.Already JNNSM has been criticized by a parliamentary panel for the tardy progress.Note some states have taken the lead in pushing solar energy on their own,namely Gujarat which aims to put up more than 500 MW in the next year or two.
November 29, 2010
India's JNNSM Phase 1 which is targeting 1000 MW of Solar Power Capacity by 2013 is in jeopardy due to irrational bidding,financing and small size.The 150 MW Solar PV and ~500 MW of Solar Thermal Capacity which has been put to bidding is going to see massive discounts.This will eventually lead to project winners abandoning these projects or delaying it inordinately,leading to a failure of the first phase.India Solar Thermal Bidding has already seen Massive Discounts from the base prices of Rs 15.31 set by CERC and the Solar PV project bidding for 150 MW is going to see equally ferocious discounts.Tata Power,which is India's largest private utility is staying away from these auctions due to the above problems.Renewable Energy in India has a huge growth potential with Solar Energy the brightest Green Energy Sector.This has attracted companies in droves leading to hyper competition for the first phase of India's Jawaharlal Nehru National Solar Mission.However huge competition in this subsidy driven sector is not necessarily good for the growth of Renewable Energy as irrational bidding by small players would lead to project failures.
November 26, 2010
India has set up ambitious targets of meeting 15% of its Energy Needs from Renewable Sources up from around 5.5-6% in 2010.WIth India's Electricity Capacity expected to rise to 450 GW from around 165 GW,this would imply that around 67.5 GW of Electricity Capacity would be needed up from around 16 GW.This would mean around 5 GW of Capacity addition every year in the next decade which is a very tall order.20 GW could be met by Solar Energy according to the Jawaharlal Nehru Solar Mission (JNNSM).Most of the rest would have to met by Wind Energy.Biomass Energy has high costs and reliability problems which mini hydro potential is only 1 GW.Note this is just the capacity I am talking about,for meeting the electricity generation,capacity additions would have to be greater as Solar Energy and Wind Energy have only 20-30% Load Factor compared to 60-80% for Fossil Fuel Energy Sources.Nuclear Energy can contribute another 20 GW.
Renewable Energy in India is growing at a rapid pace increasing its share of the total capacity from 2% in 2003 to around 10% in 2010.However the share of electricity generation is still quite low at 3% due to the lower capacity load factors of Green Energy Sources compared to Fossil Fuel Sources.The Total Installed Capacity of Renewable Energy in India is around 16 GW with Wind Energy taking the Lion's share at almost 70% followed by Small Hydro at 15% and Biomass Energy at 12%.Solar Energy in India till now has a capacity of just 6 MW which is estimated to grow to 22 GW by 2022 making Solar Energy one of the Biggest Growth Opportunities in the Field of Indian Energy.
November 16, 2010
India has a huge potential in Solar Energy Generation which is being strongly supported by the Federal Government under the JNNSM Scheme and by individual States […]
July 5, 2010
Solar Energy in India has the potential to be one of the biggest opportunities in the Energy Sector in the 21st Century.The government’s strong backing through […]