Godrej Power Infrastructure & Renewable Energy (PIRE) has been established to make solar energy affordable to millions of Indian customers as well as reducing the carbon footprint of the company. Through PIRE, Godrej provides turnkey EPC (Engineering, Procurement and Construction) services and build small and large grid-connected / off grid solar power plants across India.
PIRE also offers variety of customized renewable hybrid solutions in the combination of solar- wind OR solar-DG OR solar-wind-DG OR other Renewable Energy (RE) sources like biomass, co-generation, biogas, hydel power, etc.
In an exclusive interaction with GreentechLed, Ashok T, assistant general manager – Business Development, PIRE, talks about the solar industry scenario in India and how Godrej helps meet the growing energy demands in the country.
Excerpt of the interaction follows:
Give an outlook of the solar industry in India. How do you expect the industry grow in the coming years?
There is no debate that India is a big market for solar considering the high energy deficit, good irradiation levels and un-balanced rise in the fossil fuel based energy source. However, in recent time, it is going through a tough phase due to rupee depreciation, policy uncertainty, delay in subsidies, etc. Though it is under the re-structuring phase, we will see a fast growth in coming years considering the power needs increasing @ approx. 15 percent every year and grid parity is closer.
What are the goals of Power Infrastructure and Renewable Energy (PIRE) in India?
- PIRE is in active business since July’12 and caters to the off-grid and on-grid segment of the solar space.
- Having successfully executed the 250 kWp rooftop project in Chennai and an 80 kWp project in Mumbai, it has a decent pipeline of clients (private) which it would execute in the near future.
- We also assist clients in obtaining financial closures for the projects as well as offer third party PPA schemes.
- Even while catering to the energy needs of the various customers, we ourselves are coming up with innovative in house projects to reduce the carbon foot print.
What are your strategies to capture the growing renewable industry in India?
- Add value in every way to the end customer rather than merely providing EPC support.
- High quality Installations coupled with O&M services and a strategy of before time completion schedule is what we are constantly working to establish ourselves as a reliable EPC player.
- Ensure brand dependability through its PAN India presence and its utmost connect with end customers
- Provide easy means & ways to make solar an affordable option.
What are the challenges faced by EPC contractors in India?
- Non existence of sustainable policies with a long term vision and penalty implication in case of non-compliance,
- Currency fluctuation,
- Timely receipt of financial closure for projects to enable a balanced cash flow
- Need of strong funding measures coming from private and Govt. sector.
How long it will take for solar to achieve grid parity?
At an aggressive case, it should be possible by end of 2015 – 16 and on a base case it might happen by 2017-18. (As the Phase 2, batch 1 PPA itself is less than grid price)
What are the cost concerns of the industry? Do you think the diminishing costs of solar power will backlash the solar industry?
The diminishing cost will improve quicker adoption of solar, as what happened in mobile industry. As the market would be wide open, one of the major keys to success depends upon how we tackle the competition from unorganized players. For grid connected market, project developers have different expectations in terms of cost, but it should be admitted that the LCOE is driven by cost as well as quality.
What are the main hurdles preventing solar adoption in residential segment?
The major hurdle is the upfront capital cost. Though the prices are slashing down, it has not touched the level that is attractive for a middles class people in India. Lack of awareness, availability of low cost funding, better after sales service are also some of the major hurdles faced in this segment.
What are the major concerns from customers? How do you address them?
The major concerns from the customer are both on the technical as well as commercial aspect. The stability of the roof to hold panels for 20 years, leakage issues, cleaning of the panels etc. are some ofthe technical challenges concerning the customer. Our well experienced team looks into all these aspects before we arrive at a final terms. On commercial front the big question is the investment itself.
We are trying to mitigate the need to afford higher CAPEX by offering Private PPA option, Solar leasing models etc.
Do you prefer imported panels over indigenous ones? Why?
As such we don’t have a particular preference on domestic / imported modules. We are keen on having domestic modules in our projects if Indian manufactures are cost competitive and could meet the delivery. This will help us always for quicker warranty claims from the supplier.
Moreover this would promote growth of Indian solar federation.
Any expectation from policy makers to improve the health of the industry?
Looking into a target of 20 GW by 2022, a growth rate of 30% is what is required annually. There should be support for the state policies by the Center though they are offering Incentive schemes. Strict enforcement of SPO / RPO coupled with penalty implications, incentivizing self-consumption, improving the commercial lending to reduce the dependency on state and central subsidies, proper disbursal of subsidies are some of the areas which needs to be looked upon. Domestic modules manufacturers must also be supported well with policy reforms to ensure a sustainable growth.
Rajani Baburajan