India has a significant potential when it comes to generating solar energy. The geographical location of the country is such that it is guaranteed to receive more than its fair share of solar radiation compared to several other countries. Since India is a tropical country, it gets close to three thousand hours of sunshine every year. In terms of generation capabilities, this is equivalent to 5000 trillion kWh.
Solar Power Capacity – Outlook of Indian Government
The Indian government is planning to increase its capacity for solar power generation to 1,00,000 MW. The Ministry of New and Renewable Energy has been instructed to achieve this target by 2019. The government estimates that to achieve this target, an investment of 110 billion dollars will be required. Much work will have to be done in areas of increasing the transmission capacity, for instance. It is pretty much expected that it will be impossible to accomplish this objective with investments generated from within the country only. However, the authorities are hopeful that with the major announcements being made by the national government, investors from outside India will take a note of it.
Every year the government will need an investment of a sum between 15 and 20 billion dollars, and approximately six billion dollars of this amount is supposed to come from investors from other countries. The Indian PM’s efforts are appreciable in the context of arresting the perennial power shortage in India, and the renewable nature of solar energy. Even though the amount of sunshine received by India is much more than many of the European nations that are using clean energy, its clean energy does not contribute even one percent to the aggregate energy demands of its people.
India’s coal supplies are woefully inconsistent, but it is the main source to meet the energy demands in the country. This erratic nature is one of the major reasons why India faces so many power cuts that have been a consistent bane to its industrial progress and overall economic growth. If the government can indeed get investments in this regard from countries such as China, Germany, Japan and the United States, it could increase the proportion of clean energy in India to up to ten percent.
Global Support for Solar Energy
Even as the Indian government has been announcing a number of mega projects for solar power generation, there has been a significant amount of support for the industry coming from outside the country. It is expected that Morgan Stanley, one of the prominent business houses of the US, will invest a major amount in a project with a capacity of at least 100 MW. It is being said that the institutional investors like Standard Chartered and IFC are also interested to invest in the solar power projects. ReNew Power, promoted by Sumant Sinha, has also received 375 million dollars in investments from Goldman Sachs.
Goldman Sachs is also looking at opportunities to invest in other such companies – both new and established ones – in order to make a significant contribution to the clean energy industry in India. When Narendra Modi visited the US during 2014, the US Exim Bank provided a billion dollars for the existing solar energy programmes in India. KfW, a publicly-owned organisation from Germany, and ADB are also looking for similar opportunities. As far as power production and manufacturing sectors are concerned, ten Chinese companies—big names in the world of solar energy—are eager to partner with the Indian companies.
Prominent officers in the Madhya Pradesh government have stated that they are in the final stage of discussions with a solar cell making company from China. They are soon supposed to build a working facility over there. SunEdison and First Solar, based in the US, have always made their presence felt in India’s solar energy firmament. They have taken part in the bidding procedures initiated by the central as well as the several state governments of India. Other companies such as EDF, Solairedirect and Fonoroche from France, and Germany-based B Electric are interested in becoming a part of the solar energy wave of the national government.