Global PV Solar Growth Analysis and Scenario in India

China’s policy shift, mega tender cancellations and policies levying taxes and duties on solar industry in India, feed-in-tariff cut in Japan have made 2018 the year of uncertainty for solar. However, surveys suggest that global PV solar installations will see nearly 18% rise in 2019, finally reaching and may be surpassing 100 GW capacity addition. Although, at the end of 2019, we would still be far from ‘0’ emission future, rising PV installation growth and emergence of new markets within developing countries will get us closer to that goal.

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Sustainability and Climate Improvement needs Long Term Policies

A blanket of CO2 has enveloped the world. And continues to deteriorate our climate. Frequency of heatwaves has increased, habitats have started to shift, spread of disease, raising sea levels and other not so subtle and often violent changes in the climate are now reality due to growing CO2 emission levels. Daily Global CO2 emission levels now stand at 406.47 parts per million. It is important to note that CO2 emission levels have never risen this high in last 400,000 years. Our fossil fuel usage is the primary reason behind this rise (80% of CO2 emissions come from fossil fuel combustion) that is presenting devastating changes within the environment. Fortunately, now the world is taking initiatives towards reducing the CO2 emission. However, the damage to the climate that we have done through decades of fossil fuel usage cannot be undone instantly; therefore, what the world needs is long term strategies to reduce carbon emission by adopting green energy and reducing fossil fuel usage.

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How to Preserve Investor Interest?

Indian solar sector showed incredible progress in recent years by becoming a 30,000 crore industry. But, in Q1 ​​2018 corporate funding within the solar industry fell by 65%. Fortunately, the numbers have significantly increased by 15% as 2018 comes to a close. Nearly $5.3 billion was raised by the first half of 2018 in comparison to 2017. As a nascent industry, the Indian solar sector needs support and funding to grow. And, factoring in the growth of funding scene, this can be construed as a positive development for solar in India. However, to predict the outcome, we need to inspect the present scenario in depth.

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Is Safeguard actually Safeguarding?

India has quickly built an aspiring green energy empire that promised to lead economic development through industrial capacity expansion and domestic manufacturing. And considering Hon’ble Prime minister Shri Narendra Modi’s announcement of ‘Make in India’ we can agree that the country had plans to support and utilize the manufacturing sector to drive growth. And as we hoped for, ‘Make in India’ worked well in welcoming foreign investment, encouraging technological growth, and reducing knowledge curve. This indicated a rapid solarisation of the country and showed potential to uplift India’s economy through industrial expansion. However, the initiative has failed to result into the growth trajectory it promised to showcase.

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Keeping it cool: The urgent need to control emissions before it’s too late

A recent report by The Centre for Policy Research and International Institute for Applied Systems Analysis has predicted that India’s CO2 emissions from energy generation will nearly double in 2030 from its 2012’s emission figures. Although, this 91-98% increase in CO2 emission is still going to be in line with nationally determined (in Paris Agreement) CO2 emission level; factoring in 2012’s emission figures-2 billion tonnes of CO2, it is safe to say that the rise is considerable.

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The Bittersweet Dilemma

The research report showed that recently introduced policies (2015 and beyond) are well in their way to lead India towards a faster than predicted green energy transition, which will shrink coal’s dominating share in India’s energy equation and reduce per capita emissions than today’s global average. In that case, we can come to an understanding that the policy interventions and Government initiatives towards renewable energy (especially solar) growth will have a material impact on reducing India’s future emissions.

The report also shines light on the fact that even if India’s emissions doubled by 2030, it will be lower than China’s equivalent emissions in 2015. Therefore, it can be considered as a progressive environment building up towards a sustainable green future, right?

Well, it is progressive indeed but we also have to understand that although, this is a move towards success, the picture is not very appealing right now. The efforts need to be considerably increased to reach and frankly surpass the goals. It will help us reduce our carbon emissions even more, which is a necessity.

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The Current Scenario

Presently, India is going through terrible shifts in environment behaviour, due to increased CO2 emissions within the country and the world. There are unprecedented spells of hot weather, change in Monsoon bringing issues of droughts and flood, significant fall in crop yield that can destabilize the social, economic structure of the country, adding to the turmoil.

Research has found that areas in north-western India, Jharkhand, Orissa, and Chhattisgarh have seen considerable drop in crop yield and suspected to fall further due to changing climate. As India is dependent on agriculture and about 60% of its agriculture is supported by rain, higher or lower than average rains are affecting the country. Also, rising carbon dioxide levels due to global warming is suspected to shrink down the amount of protein in crops like rice and wheat, which are the primary food source for majority of the population in India. Such conditions are leaving populations at risk of malnutrition, low immunity and raising the risk of diseases affecting the population severely.

India recorded its hottest day in the city of Phalodi, Rajasthan, when the temperature reached 51 degree C and according to a research by MIT in the US, the temperature in India will further increase in coming years.

Coastal cities like Kolkata, Chennai, and Mumbai are also suspected to be affected by sea level rise. Rising sea-level and surges of storm would also impact agriculture, degrade groundwater quality, increasing the risk of contamination in water, and giving rise to diarrhoea and cholera.

Way Forward

With effects of climate change getting dangerous every year, countries like India need to boost efforts at reducing CO2 emissions now, which is an opportunity now through opting renewable  energy transition (mainly solar). We, as a country, should understand that lowering our future CO2 emissions in comparison to industrial giant China’s past emission statistics (its 2015’s emission statistics) is not a win for us now and we need to rectify internal mechanics to support renewable energy growth. It is important to highlight that The Government of India introduced National Clean Energy Fund (NCEF) in 2010-11, as India’s carbon tax, levying duties on coal to fund cleaner energy projects and combat climate change. And in last 6-7 years, India has collected more than Rs 54,000 crore through clean energy cess by levying taxes on coal mined or imported. However, it is important to note that only half of the total collected cess (22,063 Crore) was transferred to NCEF from 2010-2017. From that amount, the investment towards projects were amount INR 17,469 crores from 2011 to 2017, and MNRE’s share from that amount was INR 12,429 Crore. On top of that, the Government of India using NCEF fund to compensate various state Governments for their loss in revenue due to GST, clearly contradicts with India’s green energy vision and initiatives.

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India must utilize initiatives such as NCEF and incorporate other policies such as- carbon pricing, while supporting renewable energy growth through investment and encouragement. It is apparent that joining the fight against climate change is not a choice anymore it is a necessity. Although initiatives of the Government should be appreciated, we should not sit idly by the predictions of a marginal success. We need to focus at prioritizing the renewable energy industry and solving its critical issues through investment and policy intervention to create momentum and see our country solve not just energy issues, but create a better social and economic structure that works towards restoring the environment.

Note: This article was published in prominent solar magazines like- EQmagpro, Energy Economic Times on 17th November 2018.