Solar Demand in 2014

In comparison to 2013, the solar demand in 2014 will increase from seven gigawatts to eight gigawatts in Japan, six gigawatts to eight gigawatts in the U.S., and eight gigawatts to 12 gigawatts in China.

Solar Energy in India is one of the most exciting growth industries in the world right now. Solar Energy in India is poised to take off in a exponential manner because of a unique confluence of favorable Supply and Demand factors. Here is a list of factors that will make Solar Power one of the fastest growing energy sectors in the world

• India has very high isolation (solar radiation in layman language) which makes solar energy much cheaper to produce solar power in India  compared to  countries like Germany,Denmark etc.
• India has a huge electricity demand supply gap – Large parts of India regularly face blackouts for lack of electricity supply leading to huge monetary losses .
• Lack of power grid availability – Solar Energy is ideally suited for providing power to those areas which don’t have power lines connecting it.Large parts of India don’t have electricity grid connectivity and it is cheaper to power them through solar energy rather than extending power lines
• Increasing expensive and unreliable electricity supply – The rates of electricity prices are going up rapidly each year due to a combination of factors like higher costs of fossil fuels,increasing capital expenditure by utilities and privatization of power.
• Solar Energy approaching Grid Parity – The costs of Solar Energy has been decreasing rapidly over the last 2 years and has reached retail price grid parity in countries like Italy,Hawaii.
• Strong Support from the Government –  The Indian government through the Jawaharlal Nehru National Solar Mission has provided strong support to the growth of this industry . The government has set a  target of 20 GW by 2022

Solar Power Plants in India
Existing Solar Plants

1) Titan Energy ,KPCL ,3 MW plant ,Yelesandra village near Bangarpet, Kolar district,Karnataka

2) Photon Energy Systems 3 MW plant ,Itnal & Chikodi towns, Belgaum, Karnataka State.

3) Titan Energy, 2 MW plant ,Jamuria, West Bengal

4) Moser Baer ,Thin Film 1 MW , Chandrapur Maharashtra

5) Lanco , 5 MW ,Gujarat.

6) North Delhi Power Ltd (Tata Power) 1 MW , Delhi.

7) Reliance ,1 MW ,Thyagaraj stadium Plant,Delhi

8) Azure Power  2 MW  Awan, Punjab India.

Future Solar Power Plants in the Works
Solar PV Energy Plants under JNNSM (5 MW)

Future Solar Thermal Energy Plants under JNNSM

1. Lanco Solar  100 MW  Rajasthan
2. Reliance Power 100 MW Rajasthan
3. KSK Energy 100 MW Rajasthan
4. Godavari Power 50 MW Rajasthan
5. Aurum Renewables 20 MW Gujarat
6. Corporate Ispat  50 MW Rajasthan
7. Megha Engineering 50 MW Andhra Pradesh

Note there is also a number of solar power plants that have gotten PPA from the Gujart Government.There is almost 716 MW of solar thermal and solar PV plants that have been allocated by the Gujarat government alone.

Solar Panel Manufacturers in India
Note this is a dynamic list which is constantly growing as more and more global solar panel companies set up manufacturing bases/sales offices in India.The Solar Market of India is simply to huge to be ignored by any major solar panel producer.While some of the bigger companies have already won contracts to supply solar panels to solar plants,others are setting up Joint Ventures to establish solar panel proudcing factories eg.Abound Solar ( a Cadmium Tellerium startup).Here is a list.

Solar Photovoltaic Companies

Domestic Solar Cell/Module Producers

• Moser Baer – This is primarily a Solar Panel Production Company which has recently made a big bet to get into the Power Production Space as well.Moser Baer Projects Private in which the Blackstone Group made a $300 million bet  has plans of a 20:80 mix of Green and Dirty Power.
• Tata Power / Tata BP Solar – The biggest private utility in India has big plans for Clean Energy as well.Its subsidiary Tata BP Solar is one of the biggest producers of solar panels and cells in the country.The company has huge plans in wind,solar and geothermal energy.It has also invested in a geothermal energy project in Indonesia..
• Solar Semiconductor – A Producer of Solar Power Modules and Cells. It has some operations in Solar Installation as well.
• The following  companies are similar to Solar Semiconductor in having a small capacity to produce silicon based solar cells or solar panels or both.
• IndoSolar
• Topsun Solar
• Titan Energy
• PLG Power
• Maharishi Solar
• Kotak Urja
• Photon Energy Systems
• Lanco Solar – A major private utility in India.Has bagged a JNNSM bid to build a big solar thermal plant.Also getting into production of poly,wafers,cell and modules based on c0Si Technology.

Domestic Government owned Solar Producers

1. BHEL – BHEL which is India’s largest Capital Good makers is the other company with the big solar ambitions.BHEL has strong capabilities in the field of making electricity generating equipment.Extending these capabilities in the field of solar power generation is a natural extension.
2. BEL – This is another state owned company established by the Indian Government to meet the specialised electronic needs of the Indian defence services.  The company produces consumer products like  , Solar Powered LED-Based Traffic Signal Lights.Tying up with BHEL to set up a big solar equipment producing facility.

Foreign Solar Panel Producers

1. Suntech – Suntech was  the world’s biggest producer of solar panels in 2010 and was one the first companies to set up operations in China.Its example was followed by a host of other Chinese companies.Suntech has been slow to expand compared to the fast growing small companies in China and has lost marketshare to them.It has started to vertically integrate in order to meet the low cost challenge from Trina and Yingli.Suntech makes one of the best quality Solar Panels in China.
2. Trina Solar – Trina Solar is one of the lowest cost manufacturers of Solar Panels in the World right now and also sells it at a very low price.This is the reason that the company in a span of few short years has managed to acquire a substantial  global marketshare.The prices the solar panels being sold are around $340 per 200 watt module.Trina Solar.Like Yingli and Suntech,Trina Solar Panels are one the best quality in China
3. First Solar – First Solar is the only Solar Thin Film Manufacturer in the world and a benchmark for other thin film companies thinking of making it big.The company was promoted by Wal-Mart promoters and has seen remarkable growth in the last few.This US based company uses Cadmium Tellurium (Cd-Te) Technology and  is the lowest cost panel producer in the world today if you don’t include any penalty for low efficiency.Even if you penalize the Cd-Te Technology for its lower efficiency vis-a-vis the higher efficiency crystalline technology,First Solar is clearly the leader with a core cost of 74c/watt.The company has a roadmap of  reducing the cost to 52c/watt by 2014 and given its track record it seems quite achievable.There is little doubt about First Solar’s ability to survive and flourish due to its massive first mover advantage

Foreign Solar EPC/Installers/Developers

• SunEdison/MEMC – US Polysilicon and Wafer Producer MEMC bought Sunedison which was one of the largest solar installers in 2008.Now MEMC is strongly expanding the system installation business not only in the US but other parts of the world like India,Europe,Korea,Canada and other places.The company recently installed one of the biggest solar plants in the world in Rovigo,Italy
• Gehrlicher Solar Belectric – One of the largest installers in Germany,it is one of the first European Solar EPC players to set up base in India as its domestic market starts to saturate in solar power and slow donw
• SDEM TEGA – Small American solar power developer
• American Capital Energy– Small American solar power developer

Note a number of small and big companies are getting into the Solar EPC Business like Punj Lloyd,ESL either alone or in JV with foreign players.Recently L&T,the biggest infrastructure players in the Indian market announced a JV with Japanese Giant Sharp targeting the Solar Market in India.

Solar Inverter Manufacturers

1. Delta Electronics – Taiwanese Giant Electronics Firm is setting up a production base in Chennai to capitalize on the Solar Inverter Opportunity.Delta is also expanding in countries like Singapore and Germany to take advantage of the the growth in Green Industry.
2. SMA Solar – The Big Daddy of the Solar Inverter Market with a   40% Marketshare of the Global Market.This Germany company has become the most valued solar company in Germany beating out the old stalwarts like Q-Cells  and Solarworld.SMA Solar has managed to maintain its marketshare and grow as fast  with the global solar demand unlike some of its competitors.SMA Solar faces tough times ahead as the growing inverter industry attracts numerous competitors and it remains to be seen whether it can avoid the fate of Q-Cells.

Note other major inverter producers have also got a presence in India which lacks high quality domestic suppliers.Domestic inverter companies are Luminous and Su-Kam

Solar Thermal Companies (not developers)

1. Siemens – The world’s largest green company is quite weak in the Solar Energy area.Like other conglomerates and competitor Areva,it acquired Israeli CSP company Solel Energy to make its foray into the Solar Thermal Energy sector.The company is looking to expand in India where the JNNSM has given equal importance to Solar Thermal Technology.
2. Areva – Another Giant Global Electrical Equipment Conglomerate which entered the Solar Thermal Energy area by acquiring a struggling CSP startup Ausra.The company is planning like the others to make a major investment of around $3 billion to build 1000 MW capacity in India.The company is the biggest nuclear equipment supplier in the world and has interests in biomass energy as well.
3. Schott – This German company is a provider of parabolic recievers used in CSP plants.The German Glass Maker is a big component supplier to the CSP industry but does not provide a turnkey solution.Schott is also involved in the Solar PV Technology area producing both crystalline silicon panels as well as thin film panels.
4. Abengoa – Abengoa is one of the most well known suppliers of Solar Thermal Equipment in the world and is a proven developer of large scale Solar Plants in Spain and USA.This Spanish giant has signed a JV with India’s largest capital equipment company BHEL to manufacture components for Solar Thermal Plants..t has managed to win a large DOE grant for constructing another large Solar Thermal Plant in the USA.It has also signed a JV with Abu Dhabi promoted Masdar to build a 100 MW Shams 1 plant near Madinet Zayed in UAE
5. Solar Millennium – The company is one of the most aggressive players in the Solar Thermal Energy Sector.The company is in the process of building CSP plants in Africa,Europe,India and USA.This German company has won several project approvals to build CSP plants in Califronia through its JV Solar Trust with Ferrostaal Inc.The company has running plants at Andasol in Spain.In 2009, Solar Millennium entered into a joint venture with Suryachakra Power Venture for joint development of solar power projects in India.The company uses parabolic tough technology and is able to provide a turnkey solution from Technology to Design to EPC.

Solar Subsidy/Solar Incentives/Solar Feed in Tariffs

The Indian Government’s launch of the ambitious Jawaharlal Nehru National Solar Mission(JNNSM) was done with much fanfare with a target of reaching 20 GW of Solar Capacity by 2022 under 3 phases from the 81 MW currently.While the government had the best intentions and had laid down a well defined 10 year plan with subsidy support for both Solar Thermal and Solar PV Technology,it has already run into problems.Due to high interest the government went in for bidding of projects which led to irrationally low bidding from unknown firms.This has put the entire exercise in question with the the biggest private utility saying JNNSM is a failure.Without extensions of deadlines it looks highly unlikely whether the 37 winners will actually put up the plants.
JNNSM is divided into 3 phases with the ultimate goal of reaching grid parity with coal by 2030.I don’t know where they came with the 2030 figure as I think solar should reach grid parity much earlier and should be below coal cost much  before

1)Phase I (up to 2012/2013) – remaining period of 11th five yr plan & first yr of 12th yr plan Target of 1100 MW
2) Phase II (2013-2017) – remaining 4 yrs of 12th five yr plan Target of 3000-10000 MW
3) Phase III (2017-2022) – 13th five yr plan 20000 GW overall

Funding of the JNNSM will be done by

1) Renewable Energy Credits (REC) – State Electricity Regulatory Commissions (SERC) to fix a minimum
percentage of energy purchase from renewable sources of energy.Each state has a RPO percentage fixed for example Uttar Pradesh recently came up with a solar tender for 100 MW in order to meet its RPO requirements of 0.5% from Solar Power in 2011.Read more about Renewable Energy Certificate(REC) Policy in India

2) Bundling of Power – NTPC’s Trading Arm NTPC Vidyut Vyapar Nigam Ltd  (NVVN) is chosen as the nodal agency for entering into a Power Purchase Agreement (PPA) with solar power  developers.NTPC will mix expensive solar power with cheaper coal power .

Solar Incentives

• Zero import duty on capital equipment, raw materials and excise duty
  exemption
• Low interest rate loans, priority sector lending
• Coal tax
• Budgetary Support for MNRE though 2011 Budget has not given anything
• UNFCCC Funds – Again not certain as no international agreement ( another pipe dream)

Technology (Solar PV vs Solar Thermal)

India’s Federal Government has given equal importance of Solar Photovoltaic Technology ( which uses Solar Panels to convert Sunlight into Electricity) and Solar Thermal or Concentrated Solar Power (CSP) Technology which uses Heat from the Sun to generate Electricity.The Solar Thermal Advantages of energy storage is also overrated because it is cheaper to add energy storage to Solar PV given here in Solar Thermal Myths.Note Solar PV has many other advantages of Solar Thermal anyway.The Rapidly Declining Costs of Solar PVin fact pose a massive threat to all other forms of Solar Technology including Thin Film which has recently seen a number of players gone bankrupt.The recent conversion of Solar Thermal Plants by Tessera,the losses being made by Solar Millenium due to delays are further evidence of the decline and possible obsolescence of Solar Thermal Technology.Disadvantages of Solar Thermal Technology

1) High Costs – Desertec will apparently cost Euro 3.5/watt with another Euro  50c/watt cost for High Voltage Transmission.However these costs are too high  as Solar PV already costs Euro 3.5/watt and even on a conservative basis will have its costs reduced by 5% in the next 10 years making it attain half the cost of Solar Thermal Technology by 2020

2) Future Technology has a high probability of making CSP Obsolete – Solar Energy has become a Hotbed of Innovation with daily news of some new breakthrough in materials and process in PV Technology.Oerlikon has come out with a radial new a-Si Technology while CIGs player are touting increased efficiencies.Chinese Solar Companies have captured large chunks of the Solar Market through low cost leadership while number of Global Heavyweights like Posco,Samsung,Hyundai,Sharp,GE,TSMC promise to further decrease these costs.To bet Euro 400 Billion on a Technology that has a high probability of becoming obsolete is too risky.

3) Water Issue – Solar Thermal Plants use lots of Water which is Major Problem in Desert Areas.Using non-water cooling raises the cost of CSP projects too much.While using SeaWater has been proposed it remains to be seen if it possible to implement this solution as this would imply building Plants very near the Coastline

4) Ecological and Cultural Issues – The Usage of Massive Arrays of Mirrors is noted to heavily impact the Desert  Wildlife endangering the endangered species.California has already seen a massive fight on this issue with Project Developers curtailing the size of their Plants and spending money to move the wildlife.Don’t think this would receive too much attention in the African countries.They are also cultural issues with some of these Muslim countries might have in Exporting so much Energy to Christian Countries.

Summary

Solar Industry is a fast growing exciting industry with its inevitable growth pangs as well.The first phase of India’s Federal Policy has seen many hurdles and its success is in doubt,on the other hand Gujarat has managed to attract investment and power plants through a forward looking subsidy.States like Uttar Pradesh,Delhi,Maharashtra are also tentatively coming up with their own incentive policies.The Industry will see many ups and downs before it becomes a major billion dollar industry.Note Solar Power Industry has become the fastest growing in USA where it doubled last year and looks set to double this year again. The Nuclear Accident in Japan has given fresh energy to Solar Power with China set to double its target to 10 GW by 2015.