Solar: Upstream and Downstream

Amazing things are happening in India's renewable energy market - especially solar power.

Yesterday , it was reported that at an auction of a 250 MW capacity plant at Bhadla (Rajasthan), South Africa’s Phelan Energy Group and Avaada Power bid INR 2.62 (USD 0.04) per kilowatt-hour (kWh) to win contracts to build capacities of 50MW and 100MW, respectively, at Adani Renewable Energy Park Rajasthan Ltd. This is a new record low. The bidding wars seem to have now reached a point where experts are wondering if it is commercially viable to produce produce power at these rates.

If the unit price is surprising, so is the sheer scale of the new 'solar farms' that are coming up. The current world record the world's largest solar project in a single location is now held by Adani's 648-megawatt Kamuthi plant (near Marurai, Tamil Nadu), which went online in September, 2016. The second largest solar plant, the Topaz Solar Farm in California, has a capacity of 550 megawatts.

For a country that located in the tropics, India has a huge potential for switching over to solar energy. Consider these facts -

• The solar  radiation incident over India is equal to 4–7 kWh per square meter per day with an annual radiation ranging from 1200–2300 kWh per square meter. 
• It has an average of 250–300 clear sunny days and  2300–3200 hours  of sun shine per  year. 
• India's electricity needs can be met on a total land area of 3000 km2  which  is  equal  to  0.1%  of  total  land  in  the country 
• Currently  India is  generating  4.59%  of solar energy  of  total  produced  renewable  energy  installed capacity in India

Over the past few years, thanks to a concerted push by the government, India has quadrupled its solar-generation capacity from 2,650 MW on 26 May 2014 to 12,289 MW in 10 March 2017.  Yet, behind all these impressive numbers, fact remains that present and future growth is completely hinged on the import of equipment from China. In 2015-16, the value of imported solar cells and modules tripled to $2.34 billion, with China accounting for 83 per cent ( $1.9 billion).

Despite having a dedicated Ministry for New and Renewable Energy (MNRE) for the past 15 years, why is it that India has not been able to it own supply chains? Why is it that Indian manufacturers have no access to domestic upstream raw material supplies of poly-silicon and wafers?

According to a KPMG report (2015), India has not been able to create economies of scale in solar manufacturing, mainly due to insufficient government support - loans, tax holidays, subsidized utility services, easy access to land and technology support.

Is that a rather simplistic view?


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REFERENCES & LINKS

* (2017) Wire - Why Increasing India’s Solar Energy Capacity Won’t Work -- https://thewire.in/116842/solar-energy-india-capacity/

* (2017) Mint - http://www.livemint.com/Industry/MKI7QvOhpRoBAtw3d4PM5K/South-African-firm-bid-takes-solar-power-tariffs-to-new-low.html

* (2017) - Solar panel imports - https://www.zauba.com/import-solar-panel-hs-code.html -- HSCode - 39209919

* (2017) - http://indianexpress.com/article/business/economy/pm-modi-calls-for-all-solar-power-city-model-stresses-job-creation-4648770/

* (2016-Dec) -- http://indianexpress.com/article/india/indias-87-per-cent-solar-cell-imports-from-china-in-april-september-piyush-goyal-4417312/

* (2016) - BL - Import of solar panels triples in 2015-16 -  http://www.thehindubusinessline.com/economy/import-of-solar-panels-triples-in-201516/article8788743.ece

* (2016) - Adani's Kamuthi Solar Power Project - http://www.ecowatch.com/india-solar-market-2118202661.html

* (2016) - India's solar energy push to generate 1 mn green jobs -- http://www.business-standard.com/content/b2b-manufacturing-industry/india-s-solar-energy-push-to-generate-1-mn-green-jobs-116021500523_1.html
- Report by Natural Resources Defense Council (NRDC) and the Council on Energy, Environment and Water (CEEW) -- ‘Filling the skill gap in India’s clean energy market: Solar energy focus’
- The country will need new skilled workforce & training to achieve its ambitious national target to add 100 gigawatts (GW) of installed solar energy by 2022
- one million new engineers, technicians, solar installers, maintenance workers and performance data monitors
- International Solar Alliance (ISA) -  alliance of more than 120 solar-rich countries aims to facilitate widespread deployment of solar power and supporting knowledge exchange on manufacturing and skills.

* (2015) - DTE - WTO rules against India in Domestic Contents Reqirements for the Solar Industry -- http://www.downtoearth.org.in/news/wto-rules-against-india-s-domestic-content-requirements-in-solar-power-50977
- Indian manufacturing capacity of solar cells and modules is limited to 1,386 MW and 2,756 MW respectively. The Mission's target at the time of the complaint stood at 10,000 MW to be achieved in the period from 2013 to 2017.
- Since the solar target has been revised to 100,000 MW or 100 GW by the Modi government, the target now stands at 29,000 MW.

* (2015) - Research Paper - Potential of Solar Energy in India - https://www.researchgate.net/publication/306034848_Potential_of_Solar_Energy_in_India_A_Review
-  The solar  radiation incident over India is equal to 4–7 kWh per square meter per day with an annual radiation ranging from 1200–2300 kWh per square meter.
- It has an average of 250–300 clear sunny days and  2300–3200 hours  of sun shine per  year.
- India's electricity needs can be met on a total land area of 3000 km2  which  is  equal  to  0.1%  of  total  land  in  the country

Potential of Solar Energy in India
- Currently  India is  generating  4.59%  of solar energy  of  total  produced  renewable  energy  installed capacity in India

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* India Solar Resource Maps - http://mnre.gov.in/sec/solar-assmnt.htm
* NREL - National Renewable Energy Lab - http://www.nrel.gov/international/ra_india.html

* International Solar Alliance (ISA) - http://intsolaralliance.org/

* (2016) Yes Bank - Compendium of Global Success Stories in Solar - http://intsolaralliance.org/docs/CompendiumofGlobalSuccessStoriesinSolarEnergy.pdf

* (2015) - KPMG Solar Manufacturing Report - http://www.energetica-india.net/download.php?seccion=articles&archivo=3Eksv7L8BosildPLOdK84G1zZk6Ew1co6BVp8hm0LThwxw9APH9HOx8.pdf

* Wiki - List of solar manufacturing companies - https://en.wikipedia.org/wiki/List_of_photovoltaics_companies