India News & Analysis

Mercom Capital Group, llc, a global clean energy communications and consulting firm, today released its annual and fourth quarter funding and merger and acquisition (M&A) activity report for the solar sector in 2011. “As the nation’s solar policies take shape, India is finally on the world’s solar funding map. Most investors that participated in Indian large-scale solar projects were export banks, government or state-owned banks. For India’s solar industry to truly thrive there needs to be a conducive environment to attract more robust participation from private financial institutions,” said Raj Prabhu, managing partner of Mercom.

The Ministry of New and Renewable Energy (MNRE) announced in August that 35 of the 37 photovoltaic (PV) projects amounting to 140MW were able to submit evidence of funding and all of the seven concentrated solar power (CSP) projects amounting to 470MW were able to secure funding under Phase 1, Batch 1 of JNNSM. This is a very optimistic sign for the JNNSM solar program as there were doubts about the ability to secure funding on most of the projects due to the low bids submitted. What is not clear is if these projects were mostly funded by banks and financial institutions as project funding or if they were primarily funded through balance sheet funding. All PV projects in Batch 1 are due to be commissioned around the second week of January 2012 and Batch 1 CSP projects are due to be commissioned in May of 2013.

According to a first-of-its-kind survey conducted by Mercom Capital Group titled 'India Renewable Energy Awareness Survey,' only 56% of Indian consumers have heard of 'renewable energy' or 'clean energy', and only 27% of consumers have heard of 'energy efficiency'. Although awareness was low, 71% of Indian consumers surveyed are willing to pay higher rates for electricity from renewable energy sources.

New guidelines were issued by Ministry of New and Renewable Energy and the present set of guidelines is applicable to the Second Batch of the photovoltaic projects to be selected during 2011-12. These guidelines will have no bearing on the projects which were selected in the First Batch in 2010-11. There are several changes in the guidelines for batch 2 compared to the guidelines of batch 1.

By the end of the second quarter 2011, the whole of India’s solar sector was waiting anxiously for the looming deadline of July 9th - the date that project developers were to have secured funding for JNNSM Phase 1 (Batch 1) projects. This date has gained even more significance after the Secretary of Ministry of New and Renewable Energy (MNRE) publicly stated that projects that did not receive funding by this date would not get an extension, with outright project cancellations to follow. Companies were given six months from the PPA signing date to secure their financing.

After the launch of India’s Jawaharlal Nehru National Solar Mission (JNNSM), the world’s solar markets have been closely monitoring its progress. Particular interest is focused on the program’s movement from the policy stage into execution. In its first quarterly report on the region, Mercom Capital Group discuses its progress.

With more than 9,000 delegates, over 250 speakers and 600 exhibitors from 50 countries, DIREC 2010 turned out to be the most significant event for renewable energy held in India this year.

India's Jawaharlal Nehru National Solar Mission (JNNSM), a major initiative of the government of India, has set itself a goal of creating an enabling policy framework for deploying 20GW of solar power by 2022. India's objectives and intentions are commendable. Yet, as we have seen globally, once governments announce their intentions to develop a solar incentive program - a variety of interest groups, each with their own agenda, get involved to put their stamp on the policy. The final output of the recently released policy guidelines reflects both the overarching objectives of developing clean solar power, addressing power shortages and stakeholder concessions.

Mercom Communications India, Pvt. Ltd., a subsidiary of Mercom Capital Group, a clean energy communications and consulting firm attended the SOLARCON India 2010 conference held in Hyderabad last week. Having also attended 2009 SOLARCON, the difference in the mood was evident, with a rush of participant interest and enthusiasm. In 2009 participants were unsure of what the future of the sector had in store for them and relied on speculation about the future of the industry, whereas this year the conversation centered on achieving targets set by the ambitious Jawaharlal Nehru National Solar Mission (JNNSM).

The 3rd Renewable Energy India 2009 Expo held in New Delhi, India on Aug 10-12, 2009, had an impressive turnout from around the world. The event echoed the mood of the renewable energy industry in India, upbeat, yet uncertain. The participants were very excited about the future of renewable energies but were unsure about the effects of the global recession and the support the renewable energy sectors will receive from the Government of India.