India’s massive power outage in July, the world’s largest, is energizing the nation’s interest in solar energy and clean transportation.
Not only is India’s government speeding auctions related to 3,000 megawatts (MW) in solar plant development between now and 2017, but it is planning an investment of up to $4.1 billion to help spur electric and hybrid vehicle production.
New Solar Subsidy?
Auctions for up to 1,000 MW in planned new capacity could be held before the end of the current fiscal year, reports Bloomberg.
India’s National Solar Mission calls for the country to produce 10% of its energy –20,000 MW — with solar sources by 2022. Right now, at least half of India’s power comes from coal-fired power plants.
India’s solar auctions give the lowest bidder the right to supply energy. Most of its existing capacity about 1,040 MW was built in the last 12 months; another 3,000 MW could be constructed between 2013 and 2017.
India has used auctions, along with tariffs and power-bundling arrangements as development incentives to encourage solar development – which helped reduce the cost of solar power by 38% between 2010 and 2011. It is now considering some form of subsidy, Tarun Kapoor, joint secretary at the Ministry of New and Renewable Energy, told Bloomberg.
India’s last auction in December 2011 awarded 350 MW of solar capacity to utilities including Welspun Group, Mahindra Group and partner Kiran Energy Solar Power Pvt., and Azure Power India Pvt. With the exception of a 10 MW project that was cancelled later, all of those projects should be finished by early next year.
First Solar has made India a priority for solar project development. It is angling to win 20% of the country’s solar PV sales, by working directly with businesses seeking a more predictable energy supply.
The solar transition within India’s 30-gigawatt (GW) backup power market, is powered mainly by diesel generators, is particularly attractive because high diesel fuel costs and lower solar panel module pricing have make solar power a cost-effective alternative.
$4.1 Billion for Electric, Hybrid Vehicles
While developers angle for a piece of India’s solar market, the country is also taking steps to accelerate the sluggish market for electric and hybrid vehicles.
The government has approved a $4.1 billion investment to help spur production over the next eight years: about 60% of that money will come from public sector, with the rest from private companies providing the rest, reports Reuters.
While government officials have not yet said how exactly that money will be spent it will take the form of subsidies, research and development support, consumer demand creation, and infrastructure investments.
The country is targeting 6 million green vehicles by 2020, the vast majority of which (4 million to 5 million) will be the two-wheeled variety such as bicycles, scooters and motorcycles.
India’s Tata Motors is among the domestic companies experimenting with green transportation alternatives, although its AIRpod urban car runs on compressed air not electricity, so it is unclear how it would be covered under this new plan.