Industry experts feel positive about Gujarat Solar Energy Investment Growth Story
Monday, June 29, 2009 Leave a Comment
As the investment in past few months has been increasing, I was wondering whether is it only news or is there any development also happening? But this has been substantiated by a recent article in which corporate honchos from industry reflected their views on the Gujarat's solar energy development plans.
In beginning of the year 2009, Gujarat Government had put forward the new "Solar Power Policy" as an incentive to spur an investment in Renewable energy, the present and future of energy industry.
According to Mr. Kaushal Shah, "Gujarat has tremendous potential of being a renewable energy hub, given its vast geographical resources including Wind Energy and Solar energy in northern part of Gujarat. All it needed was political support, and which is perfectly provided by Govt. of Gujarat in Solar Power Policy of 2009". Mr Shah is the Director of Business Development at Shree Ram Eco-friendly Energy Pvt. Ltd., a Joint Venture between Caritas International, USA and Shree Ram Group of Industries, Bhavnagar, Gujarat.
According to Dr. Vithal Dhaduk, President of Caritas International, USA "We are pleased to have the opportunity to develop this 25 MW solar power project, on completion it will be the largest in size in Asia and one of the largest around the world, with one step closer to our mission of providing clean, affordable solar electricity. "
Adding to that, Mr. Mukesh Patel, CEO of Shree Ram Eco-friendly energy Pvt. Ltd. and Chairman of Shree Ram Group of Industries "The sheer size of the project helps us achieve economies of scale that are a significant factor in helping PV energy become competitive with fossil fuels and to be able to provide an increasing contribution to national renewable energy targets."
It needs to be noted here that Shree Ram Eco-friendly Energy Pvt. Ltd. will own and operate the solar power plant and sell the electricity to GPCL under a 25-year non-escalating power purchase agreement. The project will deploy about 350,000 modules and will occupy about 200 Acres of land in Gujarat.
But, besides just producing clean electricity, the project will spur further investment in Gujarat, in renewable energy, create both technical and non-technical jobs, will boost local economy and will give Gujarat, a "brand" in global renewable energy world. Although, policy seems to be sound and clear enough to incentivize the investors to dig their pockets for projects, there are some reasons that investors are holding back:
- Government's co-operation on land acquisition would be the first step that would help investors' to be more confident about the investment. Given the nature of the solar power projects, it doesn't require land in or around the communities; it can be desert areas as well, which are not used anyways.
- Minimizing the risk, as the project taking place under this policy will be established for long-term, say 25 years.
- Education on the side of debt investor is very important. If we look at the model, that western countries have deployed, Germany and Spain has developed no. of institutional investor or commercial lenders, specializing in renewable energy projects.
Hopefully, things will change and "sun" will shine soon in Gujarat and other states of India, and thus revolutionize the renewable energy sector of India.