January 25, 2011

Spanish Government faces Lawsuits over Solar Feed in Tariff Cuts from ASIF

The Spanish Government faces multiple lawsuits over its Royal Decrees which cut the Feed in Tariff for Solar PV Installations Retroactively.These laws were passed in Dec 2010 as part of the comprehensive review of the Renewable Energy Subsidies by the government.While Wind Energy and Solar Thermal Subsidies were changed earlier,the controversy over the Solar PV subsidies had forced the government to delay the change to the last minute.These changes were strongly opposed by the Solar PV Industry Association ASIF which has earlier called the measure as "industry killing".These cuts over the next 3 years would be done through a "backdoor approach" in which the subsidies would be restricted for a only a few hours for the Solar PV plants.
January 25, 2011

India's Misguided Fossil Fuel Subsidy root cause of Mafia Growth

India's Fossil Fuel Subsidies have led to a massive growth of the petrol and diesel mafia in the country.India gives subsidies on diesel,kerosene and cooking gas through its state owned petro/gas companies like BPCL,IOCL,HPCL etc.These subsidies have been given for a long time and have led to the growth of a parallel black economy in these products.They not only lead to capital misallocation but also to the massive illegal profits for a few.It is a well known fact that all petroleum pump owners adulterate petroleum ( which power most of the cars) with subsdized diesel and kerosene.This massive racket earns millions of dollars (if not billions) for a network of company officials,pump owners,government bureaucrats and politicians.The mafia is so strong and powerful that it thinks nothing of burning alive a senior police official.The racketeers are so rich and well connected that despite common knowledge nothing gets done about it.
January 13, 2011

Indian Solar Energy Feed in Tariff Federal Discrimination leads to State Pushback

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.
January 13, 2011

"Buy American" Solar Panel Military Law reveals Policy Confusion and Protectionist Hypocrisy

USA recently signed a Military Law which obliges the US Defense Forces to buy Solar Panels which are made in the USA.This "Buy American" proposal directly contradicts US actions and policy which advocates free trade in Green Energy.The US Steelworkers Trade Union recently filed a petition with the US Administration against subsidies being given to the Green Industry by China.US government officials also spoke against the "domestic content" requirements of the Indian Solar Subsidy Policy JNNSM.However when it comes to their own solar panel procurement,the US government has foolishly forced its military forces to buy USA made panels.Not that this will help in boosting the US industry too much,as a number of foreign solar panel producers like Solarworld,Suntech already have module making factories in the United States.Also it remains doubtful about how many solar panels the US Military will buy in the coming years.It will remain a fraction of the global solar demand.Instead of supporting US Solar companies like Evergreen Solar,Energy Conversion Devices which are fighting to survive,the administration has given billion dollar loans to a Spanish Solar Thermal Producer.
January 12, 2011

US Solar Survivor Sunpower Resurrection with Big Wins in the US Utility and Government Market;Buy American gives further boost

Sunpower has been the dog of the solar market in 2010 as competitive pressures from low cost Chinese companies have made investors question the long term sustainability of the company.But Sunpower has managed to survive with some smart deals like the manufacturing JV with AUO and focusing on the solar project development.Sunpower makes the world's most efficient solar crystalline panels but comes at a much higher cost.This has led to erosion of its marketshare as cutthroat Asian companies have ruthlessly cuts prices and costs of solar panels.Sunpower has lost its dominant position in the US residential market with major Chinese companies like Trina,Suntech,Yingli and Canadian Solar winning large chunks.However Sunpower management has been a trier all along with its management constantly looking for ways to survive and proper .It has also started using less efficient solar panels for its projects as part of its strategy to compete.
January 12, 2011

Global Green Investments increases by 39% in 2010 despite Copenhagen Failure

Asset Financing for utility grade projects accounted for $128 billion while a substantial amount was also raised for Green IPOs notably Enel Green Power,Goldwind,Datang,Longyuan etc.The figure does not include M&A figures not that there were any big bang acquisitions though a number of M&A activities took place in the Smart Grid space.Government individually ramped up the subsidies for Green Industries despite a failure to arrive at a meaningful global agreement to reduce carbon emissions in the Copenhagen Meet.Most of the investments tool place as countries increasingly jockey for the top spot in the emerging Green Industry.Conglomerates like Samsung,GE,Mitsubishi,Siemens have made Green Industry the focus of their management focus and investment leading to the astounding 39% growth.Note Green Advocates have said that $500 billion in annual investments will be required by 2020 to restrict carbon emissions to a tolerable level.
January 12, 2011

More Solar Jobs shift from USA to heavily subsidized Chinese Factories

About 800 jobs in the Solar Industry will be lost directly to China as the USA administration has failed to support its established solar companies.Massachusetts had supported Evergreen with $58 million in subsidies but it was not enough for Evergreen to compete against the ongoing subsidies received by the strong Chinese players who have captured almost 70% of the global market in a few short years.The other US solar companies like Sunpower and First Solar are surviving by manufacturing most of their solar panels in Malaysia and other places.The recent "Buy American" Pentagon Law may not help all that much as module making is a low value add activity already being done by European and Chinese players in the USA.In the complicated supply chain of global manufacturing its difficult to understand who ultimately benefits and loses from such provisions.Note most of the polysilicon going inside the wafers and cells made in Asia are imported from USA and Europe.
December 15, 2010

German Solar Feed in Tariff additional cut in mid 2011 almost certain unlike 2010 Drama

Germany is almost certain to cut the solar feed in tariff in 2011 on top of the regular 13% decrease.Note Germany is the largest solar market in the world by far and installed an astounding 8 GW of solar panels in 2010.With almost 18 GW of total solar installations,the German solar energy capacity is almost half of the world's capacity despite bad conditions for solar energy.Germany had set a target of around 4-5 GW of solar energy this year in the upper case and this has been vastly exceeded as solar module price cuts have made it attractive to install solar panels.
December 15, 2010

USA Opposes India's Solar Energy Domestic Content Requirements

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

2 Giant Solar Thermal Projects by Tessera,NTR in USA run into financial trouble even before start of construction

Using the same logic,I had questioned the massive amount of USA taxpayer money being given as a cash grant to build almost 4-5 GW of Solar Thermal Plants in California.Most of these solar thermal projects were approved in the last 6 months of 2010 so that they could be eligible for the Treasury Cash Grant under Rule 1603.I seem to have been vindicated quite early with 2 of these giant solar thermal projects being developed by Tessera Solar have run into trouble.The CEO of the company has already left and many of the employees have been fired.Strange for a company that has won multi billion projects in hand.The parent Irish company NTR is reportedly looking to shelve the plants as it does not have enough money for 5% of the total project costs required before 2010 end.
December 14, 2010

Feed in Tariff in Taiwan – Wind Energy to be strangely Increased while for Solar Sensibly Decreased

Taiwan which had set a cap restricted solar feed in tariff program in 2009 is set to change the subsidies to reflect the decreasing costs of solar energy.Note Taiwan is one of the biggest solar cell producers in the world,next only to China.A number of its world class companies like TSMC and AUO have made major investments into solar energy recently.It already has big pureplay solar cells companies with Gintech and Motech amongst the top 10 world solar cell producing companies.A big domestic market is a good testing ground for new companies and technologies.Taiwan is now set to change renewable energy subsidies for wind and solar energy.Solar Energy subsidy for 2011 will be lowered while for wind energy it will be increased.Renewable Energy in Taiwan - Feed in Tariffs Wind to be strangely Increased while for Solar Sensibly Decreased
December 13, 2010

Solar Energy in India – Domestic Content Requirements may be made more Stringent for Longer Time

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

First Solar in India – Wins its First Order of 15 MW in Gujarat

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

India Solar Energy Headed For a Crash as Unknown Firms Win JNNSM Solar PV Auction

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.
December 8, 2010

Largest US Renewable Energy Producer NextEra Energy goes on a Solar Farm Buying/Building Spree

NextEra Energy Resources which was previously known as FPL Energy has bought a number of Solar Energy Generating Assets in the past few months.NextEra is the largest Renewable Energy utility in the USA with around 18 GW of Capacity out of which around 6.5 GW is Gas and 7.5 GW of Wind Powered Capacity plus 2.5 GW of Nuclear Energy.NextEra Energy with its long experience in Green Energy Generation has now decided to expand its Solar Asset Portfolio buying equity stakes in Solar Thermal as well as Solar PV Farms in USA and Canada.NextEra Energy is already the biggest Wind Energy Producer in the United States and on the way to become the biggest Solar Energy Producer as well.While Wind Energy is facing uncertain times in the USA,Solar Energy is growing at a rapid clip driven by the sharp fall in Solar Panel Costs which have more than halved in the last 2 years.
December 6, 2010

Solar Energy in India – Gujarat Developing 3000 Acre,500 MW Solar Park at Charanaka through PPA with 80 Developers

Gujarat has been the biggest promoter of Solar Energy in India amongst all the other states.The State has already implemented a clear and forward looking Renewable Energy Policy with emphasis on Solar Energy.It has signed PPAs with a number of solar project developers under its State Solar Subsidy Scheme.While other states are looking mainly towards the federal subsidy scheme JNNSM to push Solar Energy Generation,Gujarat is looking to push Solar Energy on its own.Gujarat now has reportedly acquired 3000 acres at Charnaka village in Patan District which it will give to solar project developers to install solar panels.
December 4, 2010

Solar Feed in Tariff in France Halted as Renewable Energy Subsidies become “veritable speculative bubble”

France has halted its solar feed in tariff bubble putting a moratorium on new applications for installing solar panels above for 3 kw installations.This has been done after applications for solar panels exceeded the 500 MW per year target set up by the French ministry.The Prime Minister called the solar feed in tariff subsidies reaching a “veritable speculative bubble”.France has already changed its solar feed in tariffs 2-3 times in 2010 as it tries to fine tune the subsidies so that renewable energy investors earn a decent return.However the fast decrease in solar panel prices has caught the bureaucrats off-guard which is not surprising.Feed in Tariffs in general have been badly designed by most public authorities around the world leading to huge bubbles.Czech has suffered from the biggest solar subsidy bubble on which it recently cracked down through taxes,50% cut in tariffs and other measures as electricity rates increased sharply as subsidies ballooned.Spain and Italy have found their Feed in Tariffs leading to runaway subsidies while Germany which has the most successful FIT program too had to cut FIT by a single ad hoc measure in order to prevent a bubble.
December 4, 2010

Solar Energy in China – New Subsidies More Posturing for Cancun than Game Changing

Note China has not passed a solar feed in tariff despite expectations amongst solar companies for a long time.China is a solar equipment leader with 60% of Solar Panel Production taking place in China.However 98% of the panels are exported making trading partners angry.High cost Europeans and Japanese companies have been almost driven away from the global solar market unable to compete with the Chinese solar majors.Solar Energy Demand in China is still minuscule compared to the world.Soaring Coal Prices,insufficient energy supply and carbon emissions have made China think of investing a trillion dollars into green industry.Solar however has not found sufficient love despite 280 MW national auction for solar projects.Wind Energy has grown exponentially in China and now accounts for 50% of the world demand.If the same thing were to happen to Solar Energy,the China's Solar Demand would grow by 20 times.
December 3, 2010

Can the Chinese Trillion Dollars Resurrect the Faltering Global Renewable Energy Industry

Renewable Energy has faced a very bad year in 2010 at least in terms of stock prices.The failure of the Copenhagen Climate Meet in 2009 and the complete indifference towards the Cancun Meet in Mexico has made the Green Energy Sector one of the worst performing ones.Wind Energy has been the worst hit with falling gas prices and falling subsidies with USA and Europe the worst hit.Other sectors like Solar Energy and Biofuels have not got much love from the markets either.In fact major financial insitutions have sharply reduced their Renewable Energy Holdings with Short Interest Rising to a Record High amongst Green Companies like American Semiconductor,Jinko Solar etc.However despite the ascendancy of the Republicans in USA and the cold shoulder given to climate and energy bill,this might mark a bottom for Renewable Energy
December 1, 2010

Will Sharp be Decimated like the Europeans by Chinese Solar Panel Companies

Chinese Solar Companies have increased their global marketshare of the Solar Panel to around 60% from virtually 0% in 2006.The Solar Panel Dominance of the Chinese has been growing since last year as Europeans and Japanese have found no answer to their cheap solar panels.Q-Cells,Solarworld and other European companies have been reduced to bit players in the Solar Market as the low cost Asians have ramped up their capacity and shipments in 2009 and 2010.The only reason that they continue to survive is the more than 100% growth in the Solar Demand in 2010.With oversupply expected in 2011,Europeans will be virtually wiped out from the world solar panel market due to their high cost uncompetitive business models.European solar factories are closing as the remaining companeis shift their production to low cost Malaysia and Singapore.
November 26, 2010

Renewable Energy in India – Past,Present and Future

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 25, 2010

Green Investing in India – ADB forms JV with NTPC and Japanese Kyuden to develop 500 MW of Renewable Energy

Asian Development Bank (ADB) has planned $2 Billion in Annual Green Investments in power hungry countries of Asia.For this the multilateral institution has sold multi-currency bonds in Japan to populate its Renewable Energy Fund.Note Green Energy is a capital intensive business and requires large amounts of low cost capital which is difficult to get in developing emerging markets of Asia.ADB is meeting this intermediary gap of funneling low interest capital from developed markets like Japan to capital deficient countries like India.Note ADB is already financing Asia's largest solar photovoltaic plant in Thailand.
November 23, 2010

Green Transport in India to get 20% Government Capital Subsidy with 30% Local Content

India has followed the example of Korea,China,Japan,USA and others in providing a capital subsidy to promote the use of Green Transport in India.Note China and Korea have been very aggressive in providing support and subsidy to the Green Industry.USA has also been providing soft loans and capital grants for manufacturing to Electric Vehicles and Lithium Batteries besides spending millions of dollar in R&D.Obama wants the US to become a leader in Battery Manufacturing with a 40% Global Marketshare while China recently unveiled a plan to create national champions in the Green Car Industry.Japan has also been supportive of Hybrid and Electric Car Technology with Honda and Toyota looking to dominate this emerging Auto Category.
November 23, 2010

Large Utility Scale Solar Projects in USA faces Unlikely Opponents in Defense Industry and Wildlife Activists

The US Government has recently approved a number of Large Scale Solar Thermal and Photovoltaic Projects as Renewable Energy Projects rush to meet the December 2010 Deadline for getting the 30% Subsidy Cash Grants from the US Treasury.California has been leading the way with gigawatts of solar thermal plants being approved.However these projects are facing resistance from local groups due to different reasons.Green Activists are questioning the Environment Friendliness of these projects due to the harmful effects on endangered desert wildlife.While some projects have dedicated millions of dollars for the Rehabilitation and Resettlement of Tortoises and other wildlife,Green NGOs are not convinced.The 660 MW,$2 Billion Tessera Solar Thermal Plant has been put under a review of its approval due to protests that the approval was done with haste and without following proper procedures.Note Large Solar Thermal Projects need hundreds of acres of land and are being frequently built on public land.
November 22, 2010

India Solar Thermal Bidding sees Massive Discounts;479 MW Projects to be constructed with 90% in Rajasthan

India's ambitious JNNSM Plan to build 20 GW of Solar Capacity by 2022 has seen projects being awarded for 479 MW of Solar Thermal Projects under Phase-1.The Solar Project Bidding was expected to be extremely competitive and it turned out to be exactly that with dis conts of more than 30% being offered to the base price of RS 15.31 for Solar Thermal generated Electricty.Note Rs 15.31 was determined to be a decent price on which a Solar Thermal Plant Developer could get decent returns just a year ago.This means that a 30% Discount would lead to zero or very low returns for the Solar Thermal Winners.According to news reports there are 7 winners for these Solar Thermal Plants 6 of which will come up in Rajasthan which seems to be the biggest winner of these Solar Subsidy Scheme.Andhra Pradesh is the only other state to win a Solar Thermal Project.There were about 60 applicants for the Solar Thermal Part of the Phase 1 JNNSM Bidding from which these 7 have been selected.
November 18, 2010

"Renewable Energy Certificate" Policy Starts in India – What you need to Know and Who will Benefit

Renewable Energy Certificate (REC) Policy is starting in India tomorrow which will allow Green Energy Generators to earn additional tariff.Note the REC Mechanism is also present in different forms in Italy,USA and Australia and has proven a good incentive to promoter Renewable Energy in those countries.India's Electricity Regulator (CERC) has been actively implementing different orders to boost Green Energy Generation.CERC had earlier mandated a 6% Renewable Energy Percentage from Alternative Energy which would go upto 15% by 2020.The REC Policy will help in achieving those targets by providing a pseud market linked mechanism to inentivize Green Power Producers. Who will Benefit Renewable Energy Companies and Green Utilities are set to benefit the most from this Policy.Suzlon has already welcomed the policy saying that Financing will ease for Renewable Energy Projects.Orient Green Power,the largest Green Focused Utility will also be a big beneficiary.Local Indian Wind Turbine Companies should also benefit from the Scheme.It also provides companies outside the JNNSM to get decent returns from solar generation as the REC band for Solar REC has been set between Rs 12-17/Kwh.India need to increase Renewable Energy Capacity by at least 50 GW in the next 10 year to meet the 15% CERC Target
November 18, 2010

Prius Producer Toyota set to Launch 2012 Blitz of New Models to Consolidate Hybrid Vehicle Leadership

Toyota is a Leader in Hybrid Vehicles with its iconic Prius the biggest selling Hybrid Car by Far.Toyota has been cautious about the growing rush into the Electric Vehicle Category.It has tied up with the much hyped up US Startup Tesla to introduce an EV RAV4,however its concentrating its energies on the Hybrid Car Market.Note another Japanese Automajor Honda is putting its bet on the Hybrid Segment of the Green Vehicle Market.The Economics of the Electric Vehicle Market as well as its Carbon Footprint is suspect despite all the media hoopla being created around it.While the Competition has increased substantially around both the EV market and its allied Battery Sector,the profits are far off.Hitachi has forecast losses for the next 2-3 years as China and USA compete to create national champions in the EV sector with Obama aiming for a 40% global marketshare .
November 18, 2010

Curtains Fall on only US Carbon Trading Chicago Climate Exchange on Republican Ascendancy

Chicago Climate Exchange the only USA Exchange to allow trading of Carbon Emission Credits has been shut down by its owner ICE.While I am no fan of Carbon Emissions Cap and Trade Policy as it gives rise to Frauds and Misplaced Incentives,the mechanism is one of the popular subsidy tools in combating Global Climate Change.Note Carbon Cap and Trading was on the Policy Agenda of the Obama Administration,however a deadlock in the Senate prevented any move in 2010.The US has been a huge laggard in the global warming fight and with the Republican Ascendancy following the MidTerm Polls,things are set to stay the same.Despite the BP Oil Spill and Record Global Temperatures,US remains blind to its climate obligations.With US reluctance,the Climate Change has been in Cold Storage with little progress expected in Cancun Meet.
November 16, 2010

List of Top Global Solar Energy Companies setting up Base in India Increasing Rapidly

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 […]
November 15, 2010

Why Solar Power in India will be led by Sunny,Western States of Gujarat and Rajasthan

Solar Energy in India represents one of the best Energy opportunities in the 21st Century.However the growth at least in the initial stages will be geographically unequal.This is due to the fact that Solar Power requires strong government support and subsidy currently.Without a proactive administration which smooths out the process of setting up a solar plant,growth of solar energy is almost impossible.The Indian Federal Government has already given it a strong push targeting 1000 MW by 2013 and 20 GW by 2022 under the JNSSM.While the Subsidy Program is facing some initial hurdles due to debt financing and aggressive project bidding,the long term secular growth story remains good.Some states have also been aggressive in supporting solar energy namely the western states of Gujarat and Rajasthan.