The Chinese Solar Story: Some Learnings

India’s decision to adopt green energy through solar has opened up new opportunities for energy and economic growth through industrial development. And although, India’s initiatives to support and ramp up solar should be commended, the country is nowhere close to giants like China who have become the global supplier and have dwarfed other countries in solar installations (~145 GW). China announced a new energy policy in June 2018, which terminated approvals for new, subsidized utility-scale PV power stations, halting in-country solar growth within China. The country’s new announcement of revising renewable energy consumption targets to 35% by 2030 puts China back in its mantle of industry leader.

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The Re-Alignment

China’s previous decision to shrink its renewable energy target would have dealt a terrible blow to aspiring solar manufacturing industries in developing countries like- India with influx of cheaper solar modules. However, this new policy revision re-iterates how China continues to re-align its industries and priorities to support solar growth. The new policy shows China proposing higher green power consumption targets while mandating penal action against those who fail to meet goals to help fund government subsidies to producers. China became the leading force in global solar industry (in 2017, China accounted for 54% of global PV installations) by focusing on expanding manufacturing capacities and offered subsidies to projects development. Growing subsidy cost ($15.6 billion in 2016) which are suspected to reach $39 billion by 2020 pushed China to stop its renewable energy expansion.

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However, what is exceptional is how rapidly China has solved its internal issues and are back with solar energy growth. The reason behind China’s prompt action is its obvious understanding of the solar opportunity and the promise it holds. By focusing on solar manufacturing capacity growth, China has been able to support industrial growth. Leading to job creation and economic progress. As testimony, we can take example of India and China’s influence over its solar market. ~80% of Indian solar market has been claimed by China and in In FY 17-18 the India’s solar module import expenditure stood at $3.8 billion (mostly from China). This proves that China’s decision on gaining manufacturing prowess has served the country well. And to protect what the country had built, to create and maintain demand of its domestically manufactured solar products, and to keep encouraging solar entrepreneurs; in a nutshell we can say that China sprung to action to press on its advantage in the growing global solar industry.

India Must Re-Prioritize Solar

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India has taken initiatives and created policy environment to support solar manufacturing. However, recent policy developments such as imposing 25% safeguard duties that target SEZ based solar manufacturers, differential GST rates (5% for modules and 12-18% for other inputs), and continued solar importing (FY 17-18 spent $3.8 bn) have come forward as a great challenge for domestic solar manufacturing in India.

Like China and other dominating solar countries, India must understand that strengthening domestic manufacturing eco-system is not just the best but the only choice for India to gain energy security and self reliance. And as statistics show, India can become the third largest economy in the world by focusing on domestic manufacturing, which promises to improve social, industrial, and economic infrastructure. Domestic solar manufacturing can create jobs, reduce import expenses, build industrial infrastructure within a country. This is clearly in alignment of ‘Make in India’ initiative, which also need to be re-prioritized for India’s growth.

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India has an exceptional opportunity to become energy super power and facilitate industrial and economic growth through choosing solar. But, manufacturing has to be focused to see this transition into reality. India has the perfect example in front of it, and it is China. China’s growth and tenacity towards supporting solar growth should inspire India to go all in solar.

Resource Efficiency Policies and Initiatives Can Ensure Sustainability for India

Continuously depleting natural resources pose a great threat to the world as its population continues to rise. Starvation, lack of energy, and important requirements to sustain life throughout the world has made it obvious that current consumption and production patterns are unsustainable. Focus on manufacturing and management of resources is extremely important to maintain life on Earth; otherwise the threat surrounding us would lead to further inequities. Management of lifecycle of resources, from their extraction to consumption and eventually disposal of waste has to be efficient to create and maintain sustainability of life as we know it.

Although, worldwide changes are being seen that surface necessities and align with the requirements of sustainability, not always they lead to expected results. And since managing resources is a global commitment- countries failing to create, establish and follow the process result in limiting global environment improvement. The only way to remedy the situation is cross country collaboration and development of understanding between policy and businesses within a country.

How Can Resource Efficiency Help?

Developing policies and business practices to have minimal impact on environment can also lead to adoption of resource efficient practices that can help in integrating circular economy methods. Reuse of waste would gain efficiency and responsible management system would allow countries to save millions and billions by reducing expenses and import requirement.

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Government of India’s step towards solarizing the country is indeed an inspiring and decisive step to revolutionize energy generation and usage. The country has also announced plans of embedding resource efficiency and circular economy in initiatives and polices such as- Smart Cities, Swach Bharat, Zero Effect-Zero Defect Scheme, Ganga Rejuvenation Mission, Make in India etc, which will save resources and expenses.

How Is India Working Towards Resource Management?

NITI Aayog has joined hands with European Union delegation and released strategy on resource efficiency, which is supposed to help develop circular economy that will translate into sustainable development of the country. The strategy showcases action plans involving-

  • Manufacturing capacity development
  • Institutional development
  • Sharing of best practices
  • Development of an indicator monitoring framework
  • R&D and Technology Development
  • Waste-exchange platform

These processes will support sustainable public procurement, development of industrial clusters, and information sharing & awareness generation, saving money and leading to a better developed country.

However, to operationalize strategies for resource efficiency, India needs to create and follow sectoral policies in investment, education, innovation, trade, and skills development that can support resource efficiency development.

Why Policies Are Needed?

Policies are needed to facilitate the resource efficiency processes within the management supply chain of businesses. Strategies cannot deliver result unless businesses develop resource management processes within their existing framework. In order to do that, businesses often need financial support to accept and adopt large scale efforts towards waste management and efficient resource handling. Lack of technological infrastructure also hinders businesses in following the strategies prescribed the Government. In such cases, policies facilitating support can help. It is also important to improve the economic analysis of efficient resource management.

The Way Forward

Evolving consumerism has urged rapid changes in product and service generation. India has done a marvellous job in energy generation and management by selecting solar. However, rethinking the resource management processes and effectively incorporating processes that will focus on resource usage, increasing exports, and reducing forex outflow is needed.

 

http://wsds.teriin.org/imperatives-operationalizing-resource-efficiency.php

 

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Indian Energy Storage Market: An Opportunity to Support Rapid Solarisation

Driven by deteriorating climate conditions, failure to provide electricity to all (~1 bn people globally), and depleting conventional energy reserves, the world is now rapidly shifting towards green energy- mainly solar and wind. However, since energy generation through solar and wind are intermittent, there is a merit in thinking and taking active steps towards energy storage.

The way developing countries are aggressively investing in renewable energy, it is fair to state that energy storage industry will flourish within developing countries in near future. It is estimated that by 2035, developing nations will account for more than 80% of global growth in energy production and consumption. And energy storage will definitely play a major role in that scenario.

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