Other Visions Desired State

Recommendations from NRDC and CEEW to achieve the ambitious Solar Target in India

NRDC and CEEW’s recommendations target the main concerns around cost of capital, default on payments, domestic content requirements and lack of transparency.

Financing Solutions: To attract additional investments and lower the cost of capital for Solar projects in India, NRDC & CEEW recommend the Indian government to diligently enforce Renewables Purchase Obligations, support further development of the Renewable Energy Certificate (REC) market, and share additional information on the Payment Security Mechanism, which covers potential defaults on payments. NRDC and CEEW also believe that the Reserve Bank of India and the Finance Ministry should work with the Ministry of New and Renewable Energy (MNRE) to support solar energy investment, and the private sector should lead by syndicating loans and sharing experiences in India’s solar market.

Boost Domestic Manufacturing: NRDC and CEEW also believe that India’s domestic content requirement (DCR), which was intended to nurture domestic manufacturing for silicon photovoltaic (PV) technology, has instead shifted the market toward thin-film PV, which does not fall under domestic manufacturing mandates and can therefore be imported at a lower cost. The Indian government should consider modifying the domestic content requirement to apply uniformly across all PV technologies or a percentage of PV components, as well as, adopting a different incentive to promote domestic manufacturing without restricting foreign imports. Simultaneously, manufacturers should strengthen existing networks to develop policy solutions that would ease barriers to manufacturing in India.

Create a Conducive Environment: The two agencies also advocate additional information believe the Indian government urgently needs to increase the information available on the Mission’s progress, from requiring solar projects to give periodic updates on their progress, to building confidence among investors with more transparency around technologies and commissioning processes. The central government should also work closely with state governments to facilitate land allocation for solar projects. The solar industry should create a network of solar energy groups, focused on resolving common industry concerns and interacting with government agencies to develop solutions for the entire supply chain.

The full report could be accessed here http://www.nrdc.org/international/india/national-solar-mission-ph1.asp

Shakti Foundation Assessment of the Progress of the Solar Mission in India

Shakti Foundation’s assessment of the progress of the solar mission in India found very similar issues plaguing the current Indian Solar Industry as assessed by NRDC and CEEW. Shakti Foundation’s report finds that despite the fact that installed capacity has been boosted by almost 30 times since the beginning of 2010 the future progress of solar as a viable source of energy will depend on the resolution several issues currently faced by the solar industry participants.

Shakti finds the following key challenges:

  • Cost of financing solar projects in India
  • High domestic content requirement encouraging less efficient, land intensive technologies
  • Indian bankers still perceive significant risks in investing in solar projects
  • Ground mounted solar parks are widely prevalent.
  • Thin film PV technology used in more than half of projects
  • Developers facing problems converting land for solar projects
  • Community involvement needs to increase in the decision making process for solar projects.
  • The full report can be accessed here: (http://shaktifoundation.in/report/laying-the-foundation-for-a-bright-future-assessing-progress-under-phase-1-of-indias-national-solar-mission/)

    TERI’s take on water management issues in India

    We also highlight TERI’s take on water management issues in India. Effective water management will be key to sustainable growth in India

    India sustains nearly 17 per cent of the world's population but is endowed with just four per cent of global water resources. About 50 per cent of annual precipitation is received in just about 15 days in a year, which is not being brought to productive use due to limited storage capacity of 36 per cent of utilizable resources (252 BCM out of 690 BCM). Leakage and inefficiencies in the water supply system waste nearly 50 per cent of usable water. The ground water level is declining at the rate of 10 cm per year. Over 70 per cent of surface water and ground water resources are contaminated. All this is leading towards a water scarce situation in many parts of the country.

    India has undertaken considerable investments for infrastructure development of large dams, storage structures, and canal networks to meet the country's water and agricultural needs, particularly in support of technology-based interventions to improve production of food grains, pulses, oilseeds, and vegetables. This is evident from the huge increase in budgetary allocation from the 11th Five-Year Plan compared to the 12th Five-Year Plan in irrigation including Watershed Development (from Rs 243,497 crore to Rs 504,371 crore) and Drinking Water and Sanitation sector (from Rs 120,774 crore to Rs 254,952 crore). This step has helped in achieving food and water security to a large extent, but in many areas of less plentiful surface water, the increasing use of water in agriculture and a growing population has led to higher and potentially unsustainable extraction of ground water for irrigation and domestic needs.

    The full report could be accessed here (http://www.teriin.org/policybrief/)