According to reports, investors are recreating the oil rush of a century ago, only this time they are descending with fistfulls of cash on dustbowls and barren tracts in Tamil Nadu’s districts like Cuddalore, Tirunelveli and Tuticorin, hoping to make big bucks from the harsh sun that shrivels crops and makes these areas almost completely inhospitable.
With the government set to roll out an exclusive solar power policy in a month, there is a mad scramble for land. Buyers are ready to purchase more than 1,000 acres in a single deal to set up solar farms in Cuddalore, Tirunelveli and other barren areas, say industry sources. Tamil Nadu has a high average solar energy incidence and number of sunshine hours per year. The new policy is likely to incentivise investments in solar power generation, as in Gujarat.
The scramble for land has resulted in a huge rise in revenue from property registration in the first quarter of this fiscal. Officials say there has been increase of more than 50% in registration revenue in Cuddalore and Tirunelveli over the corresponding period last year. Chennai, by comparison, registered an increase of barely 4% this quarter.
Nathan S, a realtor in Tirunelveli, says he is in the process of identifying large land holdings in these districts. “Many high networth individuals and companies have approached me for land to set up solar power farms,” he said.
Land costs 3 lakh to 4 lakh per acre in Tirunelveli district, but is cheaper in the Tuticorin and Ramanathapuram districts.
Confederation of Real Estate Developers Association of India governing council member N Nandakumar said that the surge in revenue collection in Cuddalore , Villupuram and Vellore belt has been mainly due to industrial activity.
“Industrial units and corporates are in expansion mode and are buying vast tracts of land in barren areas,” he said. There has been a huge spike in demand for land in districts like Tirunelveli, Tuticorin and Ramanathapuram.
Operating solar power farms has been expensive so far, with solar panels costing 12 crore per MW.However,with Gujarat setting up massive solar power farms and Chinese solar panel manufacturers entering the fray, the cost of equipment has fallen drastically to 8 crore per MW. Industry sources said around five acres is needed to generate 1MW of electricity.
Investors are betting that the state’s new policy will make generation of solar power, both for use and for sale, a viable option. High power consumers in the state are also exploring the option of investing in solar farms to slash their power bills. “Though solar power is a costly source of energy , government incentives could make it an attractive investment option,” an official said. An official said the increase in land registrations fetched the state 1,578 crore in the first quarter, an astonishing jump from 229 crore in the corresponding period last year. Estimates reveal that Cuddalore and Tirunelveli regions top the list with a rise in registration revenue of 68 % and 55% respectively .