De-bottlenecking, structural changes needed for India’s solar sector, says top solar PV manufacturer

“In fact, 2070 is beyond our lifetime. I guess, we will have to reach net zero much sooner than that. And there is going to be a huge demand for electricity, mainly solar power. We are a growing nation with a very low per capita energy consumption level. It has to increase. We are just beginning to industrialise. The energy demand is going to shoot up rapidly. I think we should be looking at 1,000 GW of installed solar capacity itself. India would be able to absorb that much, may be more,” Chaudhary stated.

India possesses 75 GW of installed solar power capacity at the moment, falling way behind its initial target of reaching 100 GW of solar power capacity by the year 2022.

The target is to achieve 450 GW of installed renewable energy capacity by the year 2030. The targeted contribution of solar energy to this 450 GW is not specified but is expected to account for a bulk of the same.

Chaudhary, whose company is headquartered in Kolkata, said what India had so far done is only to demonstrate its potential.

“We have done well so far, but to get to where we need to be, a lot of structural changes would need to happen. Right now, there are a lot of controls that have been set up, of which only a few are useful. Many of them are not in keeping with the needs and times of today. There is a lot of de-bottlenecking that has to happen,” he said, adding that the changes are required more in the processes than in policies.

Chaudhary further said, “There is a lot of government intervention, government involvement in the bidding process… in creating this demand for solar power. I think rather than intervening, and getting closely involved, the government should restrict itself to being just a facilitator. It should only be creating the appetite.”

Chaudhary said the solar industry was unlike many other power-producing facilities that were infrastructure-heavy. It was more about getting the economic model right.

“When you are setting up a thermal power station, for example, you need to create the whole infrastructure around the turbine boiler genset process. It is like a large-scale industry. The deployment of solar is not like that. Solar is more about a finance model that works. It needs a very different kind of treatment,” he said.

“A 1,000 MW solar power plant, let’s say, requires about 3,000 acres of land. The government needs to make sure that this process of land acquisition is simplified as much as possible, and the approvals are fast-tracked. There are many other areas where things need to move quickly,” he said.

Chaudhary said the pace of solarisation in India had to move in a different trajectory.

“We are doing about 10-12 GW of solar installations every year. Right now, there are about 30-35 GW of projects that have already been awarded, but are yet to come onboard. So, just to clear this backlog, our rate of installation has to increase about by three times. But we have to do much more, at least 40-50 GW installation every year. Look at China. It is doing about 150 GW every year. Our total installation so far is 75 GW,” he said.

Chaudhary said solar PV modules being manufactured in India were of the same quality, if not better, than those in China, but Chinese modules had a cost advantage.

“The cost differential is not because they are manufacturing better, or using better technologies, or have better efficiencies. Their advantage comes mainly from the fact that they have access to much lower cost finance. And this issue in India is not limited to the solar sector alone. It is a generic issue that India grapples with. May be when we become a US$ 5 trillion economy, things will change. Already we see there are signs of change, but it is not happening quickly,” he said.

Chaudhary said raising money from across the globe was also a challenge.

“Global investors tend to prefer stable policies. They want stable initiatives that promote a certain narrative. When the narrative is not clear, or there is a flip-flop, it becomes a challenge for us to convince them that this is a right sector for them to invest in. The investors are simultaneously looking at a number of opportunities worldwide, and we need to compete effectively to get their mind-share. And for that, we need to demonstrate that there is policy stability and a clear direction for the sector,” he said.