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Solar power market sees growth in India, but challenges remain

According to reports, correcting the misconception of solar power being expensive, getting bank funding and bottlenecks in acquiring land for solar projects are among the major challenges for those keen on investing in this form of renewable energy say industry experts.

Participating in a panel discussion on policies at Renergy 2013, a three-day international conference on renewable energy, Vivek Chaturvedi, Chief Marketing Officer, Moser Baer Solar, said the power tariff has dropped from about Rs 20 a unit to less than Rs 6 but public perception continues to be that solar power can be expensive.

On policy issues, he pointed out that over 26 approvals were needed for a company to set up a solar farm. Land issues, right-of-way for setting up transmission lines to evacuate power need to be simplified to speed up completion of projects and to bring down costs.

Pashupathy Gopalan, Managing Director, SunEdison, a multinational company, said the overall policy is in place in India and revenue streams were stable but the land issue, particularly getting the usage changed from agriculture to industry can be time-consuming.

Asset management and services need to be upgraded, he said. The company has been “humbled by challenges in Indian power plants,” Gopalan said.

Ideally, investment decision should not be based on the cheapest bidder, he said.

Vineet Mittal, Managing Director, Welspun Energy, said globally countries have simple land usage laws to encourage renewable energy. India should emulate this example and simplify procedures to permit land to be used for solar power projects.

Solar power tariff is comparable with commercial rates applied for conventional power obtained from fossil fuels.

In Maharashtra, malls, IT parks are seeking solar power as it is cheaper than conventional power for which they pay high tariff over Rs 12 a unit, he said.

K.M. Santosh, Managing Director, Enerparc India, said globally, solar power has achieved parity when compared with commercial rates of conventional electricity.

In India too, this is fast becoming true and it would only be a matter of time before residential tariffs are matched.

In the US and Europe where household electricity is not subsidised, solar power is being exploited as it is economical, he said.

Tarun Kapoor, Joint Secretary, Ministry of New and Renewable Energy, said the Ministry has urged the banks to frame separate exposure limits as recommended by the Reserve Bank of India. Off-grid solar power projects come under priority sector lending, he said.

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