The Indian PV market :

Business Potentials for German Companies in PV Sector

Pranav R. MehtaChairman

National Solar Energy Federation of India

GIZ - Indo German Energy Forum Dialogue Berlin, Germany 24 – 25 October, 2013

Driver’s of Passion for Solar

� Country’s large petroleum import bill –70 per cent of total imports as in 2006

� Large amount of central subsidy for Diesel, LPG, Kerosene

� Global Warming and Climate Change awareness – Montreal Protocol, 1992

� Crude prices touched $ 140 – 150 in 2006

� Concern for Energy Security, Energy Independence

Participation in Solar Dreams in India� The Year 2006 was important for Solar Dreams in India

� In April,2006 Dr. APJ Abdul Kalam the then President of India emphasized Solar Energy whilst inaugurating the World Renewable Energy Conference at New Delhi – setting the Solar Energy Generation Target at 50,000 MW

� In August, 2006 Integrated Energy Policy Document was released by the Planning Commission of India

� This policy assumed Rs. 25 Cr/ MW as the cost of Solar Power plants – a questionable number

� In September,2006 at the World Gujarati Conference at New Jersey, USA, I had the occasion to highlight the potential of Solar Energy for India

Period 2006 - 2008

� First ever “Solar India 2007” conference at Bangalore was organized by WISE, Pune.

� Dr. Hermann Sheer , world leader and authority on solar power was the Keynote speaker

� During the conference, we lamented the fact that India was at Zero Mega Watt despite plenty of Solar Radiation

� Many professionals, including myself requested the policy makers to revisit the Rs. 25 Cr/MW figure for Solar assumed in the policy document

� Independent studies by reputed agencies were carried out for MNRE

President Dr. APJ Abdul Kalamon Renewable Energy

April 2006

Solar Energy� Solar energy in particular requires unique,

massive applications in the agricultural sector, where farmers need electricity exclusively in the day time. This could be the primary demand driver for solar energy.

� We also need to embark on a program in solar energy systems and technologies for both large, centralized applications as well as small, decentralized requirements, concurrently, for applications in both rural and urban areas.

�Large scale solar energy farms of 100’s of MW capacity in certain number could contribute around 55,000 MW

� Carbon Nano Tube (CNT) based PV cell expected to give a high efficiency of 50% as against the present less than 20% for conventional PV cells. Research mission required.

� “Rural household solar mission” which will provide LED based Nano crystal lighting system through small solar PV power plants to 70 million rural households using kerosene.

� First MNRE Policy in February 2008

� The policy offered Rs. 12/kwh to developers

� This first MNRE policy of February, 2008 triggered a war of incentives amongst various states of India

� Accordingly Rajasthan, Punjab, West Bengal states came out with their own policies

� Gujarat Policy 2009 declared in January,2009

Indian Solar Scenario [MW]

� Year 2008 Practically zero

�Year 2013 2.1GW [Most in 2010 – 2012]

�Tomorrow 22,000 MW JNNSM

50,000 MW Many Experts

1,00,000 MW Some rare persons

JNNSM – Phase 2

�3000 MW capacity to be supported by the Government of India

�Additional 6000 MW is envisaged through Solar RPO requirement

Mandatory Solar RPO Mechanism

� The Solar RPO started with 0.25 % of the energy procured reaching 3% by 2022

� Solar Power required to meet Solar RPOs (MW)

� 2011-12 2012-13 2013-14 2014-15 1465 3018 4659 6387

2015 –16 2016 –178204 10109

JNNSM – Phase - 3

�Phase – 3 of JNNSM envisages balance 16,000 MW by 2022

JNNSM also envisages

� To promote programs for off grid applications, reaching 1000 MW by 2017 and 2000 MW by 2022

� To achieve 15 million sq. meters solar thermal (water heating) collector area by 2017 and 20 million sq meters by 2022

� To deploy 20 million solar lighting systems for rural areas by 2022

State Solar Initiatives

� Outside the JNNSM, many states are planning Solar Capacities

� Gujarat 971 MW� Rajasthan 10,000 – 12,000 MW� Karnataka 200 MW� Andhra Pradesh 1000 MW� Tamil Nadu 3000 MW� M.P 200 MW� Chhatisgadh 500 – 1000 MW� U.P. 500 MW

Sardar Sarovar Canal Solar Pilot Plant of 1MW Under Construction

Sardar Sarovar Canal Solar Pilot Plant of 1MW

Sheffler Parabolic Dish manufactured in Gujarat

32 Sq.m Parabola

Thermic Fluid Heating Application For Indian Army at Leh

Latest Solar News in India

� Solar in India breaches the 2 GW barrier

� Rs. 1875 crores earmarked for VGF under phase 2 of JNNSM

� JNNSM Phase 2 -DCR at 50% in the revised draft guidelines for 750 MW under VGF

� REC Trading – September 2013 – Solar Gains

Drivers for Future Solar Dreams

Massive application of Solar Agricultural pumps holds out a very big potential – reducing subsidy burden on State Exchequer.

Solar Agri Pumps Potential� 18 million Agricultural Pumps in India� 7 million Diesel Powered, 11 million

electricity powered.� 0.6 million electric powered pumps being

added annually.� 20 per cent of India’s annual electricity

consumed by agricultural pumps� Total Diesel used by agri pumps estimated

at 4.0 Bn litres costing US $ 320 million at subsidised rates.

Solar Agri Pumps Potential [Contd]

� Power supply in several states erratic in rural areas.

� Agriculture does not get power when needed – supply at night – odd hours.

� Water pumping most efficient use of solar power because it is available – when needed.

Constraints for Solar Agri Pumps

�High Capital Cost

�High Cost of DC Motor

�Large area of solar field required where water tables are very low

Status So far – Solar Agri Pumps

� So far 12,000 solar pumps installed in India

� Large numbers deployed in Rajasthan State

� 30 per cent Central Govt. subsidy + Varying amounts of State subsidy up to5 HP pumps – going up to 60 – 70 per cent

Road Ahead – Solar Agri Pumps� A report has been submitted to the Central

Govt. for a massive program 1.0 million solar powered pumps by 2022

� With large volumes manufacturing of DC motors that may happen – the price of motors will come down

� Module prices have shown downward trend

� Farmers will not be willing to pay much

Road Ahead – Solar Agri Pumps

� Therefore, high subsidy will be required from Govt.

� Govt. reportedly willing – but a difficult task. Hopefully, will ultimately be resolved

Need :� Selective Demonstration of Efficient

and Cost Effective solar agri pumps� Explore state of art latest technology

for DC motors manufacturing

Potential – Roof top and Off Grid Solar Power

� Given India’s large population base, large rural areas without access to electricity, rising middle class, there is a large potential for Roof top and Off grid

� Govt. of India is undertaking a massive drive for Roof top both in urban and rural areas.

� Some State Govts . are also keen on Roof top � Roof top is expected to be a game changer in

India� Germany’s strength in these areas is well

known and therefore, it offers a great potential

Potential – Telecom Tower� It is well known that there has been a large

telecom market which is further growing –given India’s large population base

� There has been hardly any noteworthy progress of solar applications for telecom towers – though it is much talked about

� There have been studies carried out for this potential – I do not have a ready access to it.

� However, this solar area also has a large potential

Potential - Solar Manufacturing in India

� Indian Govt. is set to encourage Solar Manufacturing in a big way

� Present Cell Manufacturing around 850 MW and Module Manufacturing around 1900 MW against solar potential of 50,000 MW

� Attractive potential exists for state of art cell and module manufacturing – including India as a manufacturing hub in the region

� Joint Ventures with good technology are foreseen - JVs with Financing at International Rates

Potential – Solar Financing� With a massive diversified solar program

consisting of MW power, Consumer based Roof top, Off Grid, Mini and Microgrids , Technolgy transfer and Manufacturing JVs Solar Agri pumps, Telecom Tower applications there is a large potential for Financing of the Projects.

� German Banks are already active� New Financial mechanisms and instruments

– that benefit the ultimate customer needed.

More Potential Areas for Solar Energy

� Solar Desalination Plants� Solar Air Conditioning and cooling� Solar Green Buildings� Solar and Bio Hybrids� Solar and Wind Hybrids� Hydrogen through solar energy� DC Future for Solar Applications� Much Improved Solar Storage

More Potential Areas� DC Solar Fans� DC Solar Coolers� DC Solar Agricultural Pumps� Solar Lanterns� Solar Cookers in a massive way� Newly Designed Solar Roofs using

Solar Printing Technology for Rural Applications

Drivers for Future Solar Dreams

� RPO Enforcement – including for the Captive Power Plants

� REC Projects to be Bankable –Innovative Ideas

� Higher Emphasis on Off Grid as well� Massive application of Solar

Agricultural pumps holds out a very big potential – reducing subsidy burden on State Exchequer.

In fact many of us expect

�What happened in Silicon Valley 15 years ago will happen for Solar in India in the next 15 years

What India Needs

� Mega Watt power has got traction in India750 MW announced – further plans in place

� Roof top and Off grid needed in a big way � Off Grid only 131 MW � Massive Drive for Solar Agri Pumps� Massive application of reliable solar power for

Telecom Towers� Mini and Micro Grids for Decentralised Power� Strengthening of the Existing Grid and further

Grid Expansion to cover larger areas

What India Needs� Solar Manufacturing area to be

strengthened with Joint Ventures. Present capacity of only around 850 MW of Cell Manufacturing and 1900 MW of Modules –against the massive potential of 50,000 MW

� Financing at International Rates

� New Financial Models need to be worked out including for micro credit.

What will be needed for further Exponential Growth ? How Do we reach the next level ?

Source : Solar Quarter, May 3, 2013

�

Converting Solar Dreams to Reality

� A very important step converting the solar Dream into reality will be :

“ Accord the same priority as Space and Nuclear Programs to Solar Sector”

Converting Solar Dream to Reality

Increase the Solar Energy Budget to 5 times the present Budget – until Grid Parity is achieved

I am an eternal optimist and believe in the slogan

“ Dreams Come True”

Thank You