IFC, a member of the World Bank Group, is working with India’s Rajasthan state to explore the state’s prospects as a solar manufacturing and power generation hub, establish research facilities, and help bring down energy costs.
IFC and Rajasthan state government are co-hosting a conference today titled, Rajasthan as a Solar Component Manufacturing Hub, that brings together policy makers, sector experts, international investors, and global and local solar manufacturing companies to share the latest insights on solar manufacturing opportunities in the state.
“Through interactions and in-depth discussions with major players, we hope to draw on their experience and network to help Rajasthan emerge as an attractive investment destination for solar manufacturing. This event is vital to understanding the needs of the private sector,” said Purushottam Agarwal, Commissioner, Bureau of Investment Promotion in Rajasthan.
Participants shared their views on incentive packages, support for infrastructure needs, identification of suitable zones for solar manufacturers, and exploring public-private partnerships to encourage solar sector development in the state.
“Rajasthan is one of the highest daily solar insulation recipients worldwide. A growing pipeline of generation projects, broad mineral base, relatively low labor cost, and a significant allied industry base are contributing to the state emerging as one of the leading markets for solar manufacturing,” said Hemant Mandal, IFC’s Senior Energy Specialist in South Asia.
Clean energy is a global strategic priority for IFC and it has led many innovative renewable energy investments in South Asia in recent years.
The conference is part of a three-year knowledge partnership between IFC and the state government to develop Rajasthan as a preferred investment location across key infrastructure sectors, helping increase employment and overall development. Ernst & Young also supports the knowledge partnership.
Rajasthan accounts for 80 percent of the total allocation made so far under India’s National Solar Mission plan. The state has assigned top priority to stepping up private investment in solar power and has already taken several steps in this direction. India announced the National Solar Mission in January 2010, with a phased implementation approach of working with state governments, policy makers, regulators, and power utilities to help establish solar energy leadership.
India’s performance on global environment index has improved earning it the 123th rank, primarily because of progress made in renewables. And, this has earned kudos for India’s green industry from United Nations Environment Programme executive Director Achim Steiner. “India has invested a lot in gre
en economy,” Steiner said, while addressing Indian industry in the Capital on Friday but wanted the industry to raise the bar.
This comes after a global environment performance index released recently ranked India at 123 among 165 nations, a jump of three positions as compared to previous years. Iceland tops the ranking while Sierra Leone is at the bottom of the table.
But, that does not mean that Indians do not want more. Majority of Indians in a global survey by US based public opinion agency Gallup said they want the country to adopt green economy norms for development.
Indians are more likely to say they are satisfied with efforts to preserve the environment (45%) than the ones who say they are dissatisfied (38%), the survey said, adding that majority of is more concerned about environment than economic growth.
The Indian industry can boost of being green primarily because of gains made in solar generation. A study released by Ernst and Young this week ranked India among top three nations, after China and US, on renewable growth.
The high ranking was primarily on progress made in installing solar photo-voltaic to generate power and off shore wind energy turbines.
But environment minister Jairam Ramesh still feels that India is not doing enough in research and development of renewable to become world leader as it was in 1980s.
The US’s strong solar adoption has it in second place, behind only China, according to the report, China remains on top due to offshore wind, and an aggressive five year RFP that specs 11.3% of energy from renewable sources by 2015. In solar indices, the US takes top honors, followed by India then China.
Many top-20 countries suffered from declining incentives and capital. Japan’s nuclear crisis threw the country’s energy environment into turmoil, and it dropped three places in the rankings.
Solar grew 40% since May 2010, thanks to cost and production drops. It proved more stable than wind this quarter. Gil Forer, global cleantech leader at Ernst & Young, points out:”It is important to overcome the misconception that renewable energy is too expensive, as we continue to see reduction in cost due to improvements in production and supply chain efficiencies as well as in technology.”
On May 26th, 2011, Ernst & Young released the latest edition of its global “Renewable Energy Country Attractiveness Indices”, which states that China remains by far the most promising location to pursue future renewable energy business opportunities.
The report places the United States in second place and India in third, as well as stating that nations around the world are increasingly broadening the scope of their renewable energy portfolios amid “challenging market conditions”.
“It is clear that the solar sector faces both challenges and growth opportunities,” observes Ernst & Young Global Cleantech Leader Gil Forer. “This is a good time for solar companies to continue to focus on cost reduction efforts, supply chain efficiencies, risk management and capital management.”
China scores high on wind, PV
China has held top position since August 2010, and earned its highest score ever during the quarter. China scored particularly high on its wind index, but also on solar PV.
Ernst & Young states that the China’s latest five-year plan is its “greenest” to date, including a target of 11.3% of primary energy generated by non-fossil fuels by 2015.
Lower incentive levels, restricted access to capital limit wind, solar development
The report also notes a chilling effect that the global financial climate has had on renewable energy markets, noting that some sectors, such as solar, have fared better than wind or biomass.
Ernst & Young states that apart from Brazil, which increased four places, most nations have dropped slightly in scores, as the result of diminishing incentives and restricted access to capital.
CSP, offshore wind providing new opportunities
The United States remained in second place in the report, on the strength of solar CSP, solar PV and onshore wind potential. Ernst & Young states that the nation’s utility scale solar sector remains “healthy”.
The report also notes that the increasing commercial viability of different technologies including offshore wind and concentrated solar power (CSP) provide new opportunities.
Report an assessment of future potential
It is important to note that this report was not an assessment of progress in renewable energy, but rather of future business potential.
For example, the relatively low score of Denmark (#22) represents a restricted grid capacity and reduced tariff levels following installation of the greatest per-capita wind capacities in the world.