Reliance has already established its presence in rural solar energy market by offering solar lighting and PV products for residential and industrial customers. Reliance Solar has installed and implemented a large electrification program to provide lighting for over 14,000 households in Maharashtra.
Ambani is inspired by the developments in the U.S that is fast moving toward self reliance on energy using renewable energy.
“There has been a fundamental transformation in the energy scene in the US. For many decades, we have heard that the US will be independent of foreign imports of energy. Realistically, I can now tell you that this is my judgment that this will happen in the next 5 or 7 years,” he said.
Apart from solar, Reliance has also been focusing on shale and natural gas. Reliance itself has invested $5.2 billion in the shale business in the US and has set up joint ventures with Chevron, Pioneer Natural Resources and Carrizo Oil & Gas and a midstream joint venture with Pioneer.
While India has seen several initiatives from Central and state governments to boost renewable energy investments, lack of clarity and delay in policy enforcements have created a sense of ambiguity in the industry and hindered the success of these projects.
Suchitra Sriram, program manager, Frost & Sullivan, recently revealed to Greentech Lead that wind energy investments reduced in India during 2012, for the first time over the last 20 years. According to Sriram, wind energy industry in India is severely affected by lack of government policies and other issues such as poor grid connectivity and lack of financials for the providers, Sriram said.
The lackadaisical attitude of Indian legislators has been a deterrent to the development of the sector. Investors are hesitant because the changing political scenario and lack of clarity on policies could backlash the entire process.
Frost & Sullivan analyst says ambiguity in the government’s generation based incentive (GBI) scheme and other issues such as poor grid connectivity, high interest rate, and weak financials of state-government owned power distribution companies are the top reasons for lack of interest for investment in the sector.
Further the delay in government’s announcement on the GBI framework had slowed down the industry in 2012, according to Frost & Sullivan.
Reliance’s focus on renewable energy is certainly good news for India, which is struggling to cope up with the rising energy demands due to population growth and urbanization.