The recent solar scam that hit the Congress-led UDF government in Kerala has had a direct impact on the solar industry in the state. The scam, which has been making headlines in news dailies and TV channels over the past one month, has created a sense of insecurity among customers looking for solar as an alternative source of energy to meet the power crisis.
The word solar has now become synonymous with “Saritha,” the con-woman accused in the scam that reportedly involves several ministers and the office of Chief Minister Oomen Chandy, say officials of many solar companies operating in Kerala.
Says Siva Rama Krishnan E, MD and CEO at GreenBell Sustainable Energy, “Over the past one month, solar companies have incurred huge loss. Many projects are very badly affected. Almost all new comers are either in coma or have closed their business because of trust deficit.”
He continues, “I was about to sign a project for 100 kW on last Monday and went for signing. In the last minute, they disappeared by giving some nasty excuses.”
The same view was expressed by another company, ISUMI Corporation, Cochin, a franchisee of Chemtrols Solar, Mumbai.
K. George, CEO, ISUMI Corporation, says, “Solar business in Kerala is deeply affected by the scam. The sensation created by the media and the political parties has aggravated the scenario. Customers have completely lost faith in solar business in the state.”
Companies like ISUMI, which are authorized by Agency for Non-Conventional Energy and Rural Technology (ANERT) for solar installations, are also facing the heat. George added that the sales at ISUMI have come down significantly. Ever since the solar scam hit headlines, inquiries have dropped by over 80 percent, he added.
The scam, undoubtedly, has messed up the solar industry that was emerging from its teething troubles. Like in several other states including Tamil Nadu and Andhra Pradesh, the solar industry in Kerala has grown significantly over the past couple of years.
Agency for Non-Conventional Energy and Rural Technology (ANERT), an autonomous organization established to support non-conventional energy and energy conservation programs in Kerala, had received overwhelming response for the recently launched 10000 Solar Rooftop Power Plant Programme 2012-13.
Under this program, ANERT invited applications for 10,000 homes for 1KW solar installations. Though initial response was low, the steep rise in power tariff and continuing power cuts motivated many residential and commercial customers to turn to solar energy. This resulted in steady rise in customer demands over the past few months. However, after the solar scam hit the state, fresh enquiries for the project has come down significantly.
M. Jayaraj, director, ANERT, told Greentech Lead, that the agency has received over 12,000 registrations for the said program. Considering the huge demand, ANERT has now decided to invite additional 1,000 registrations. The additional quota is also intended to ensure that allotments will not be vacant even if some parties withdraw at any stage of the program. However, he admitted that fresh enquiries have come down significantly. He partly attributes this to the heavy rain in the state.
According to Jayaraj, the solar scam has indeed affected the customer sentiments, and many people have lost confidence in the suppliers. Lack of awareness about the program and the higher cost of installations also prevent them from investing in big projects. The scam especially affected higher capacity installations, Jayaraj added.
Programs registered under ANERT are not affected by the scam, added Jayaraj. Solar installations in several municipalities and panchayaths are “on” as scheduled.
Greentech Lead’s view: The solar scam in Kerala is just a typical kickback scam involving several officials and a fraud solar company called Team Solar—and not really a scam involving the entire solar industry– but the damage it has created to the industry has been huge and devastating. It is now time people of the state realize there are many genuine companies doing businesses and they are desperately looking for support from the authorities and the public.
Renewable energy is the future of India. When states like Gujarat and Tamil Nadu are fast transforming their power infrastructure by creating grid parity with solar energy, the state government in Kerala which is responsible for taking the industry forward is caught in a dilemma how to escape the solar noose.
In this scenario, agencies like ANERT should take initiatives to regain the customer confidence and ensure transparent dealings in solar installations which they undertake. Though it will take time to change the attitude of customers, it is absolutely necessary to make the sun shine in Kerala homes.