Last week saw saturation coverage of Budget 2017 and its impact on renewable energy. While some headlines screamed “Budget 2017 gives big boost to renewable energy“, there were also several others who rued a wasted opportunity and an unfulfilled wishlist. On the positive side, especially on the manufacturing side, duties have been reduced or exempted for several items like tempered glass, fuel cells and others. According to some estimates, the exemption of import duty on tempered glass will reduce the cost of domestically manufactured solar panels by about 15 paise/Wp. The budget allocation for MNRE increased from Rs. 5036 Crores in 2016-17 to Rs. 5473 Crores in 2017-18. Allocation for Rs. 4814 has been done towards achievement of 100% rural electrification.
On the other side, the government did not extend the 80-IA tax holiday, and projects commissioned after April 2017 will not get this benefit. The impact of this non-extension will be an increase in solar power tariff to the tune of Rs 10 paise/kWh according to Ratul Puri of Hindustan Power Projects or more(20-30 paise per unit(kWh) according to Bridge to India). Read more here.
Dr. Arunabha Ghosh of CEEW explained why he thinks that Budget 2017 is an opportunity lost for renewable energy by deep diving into the specifics of some of the budgetary announcements. He covers aspects like National Environment Fund(NEF), goods and service tax(GST) and the lack of support for reducing financing cost or for technology development. Industry bigwigs like Tulsi Tanti of Suzlon and Anil Sardana of Tata Power also felt that more could have been done(read here). Indian Wind Turbine Manufacturers Association(IWTMA) expressed its disappointment and said in a press release that the government has completely overlooked the wind energy division(read here).
In non-budget news, MNRE announced that India’s Module and Cell manufacturing capacity stood at 8 GW and 3 GW at the end of 2016. Please note that this is only installed capacity and a big part of it is not operational. Adani Group has the only company that has more than 1 GW of manufacturing capacity in both the cell and module segments, but the plant is not operational yet. How does India’s manufacturing capacity compare with global firms? Not much. Hanwha Q-Cells, world’s number one cell manufacturer, had a cell manufacturing capacity of about 5.7 GW, which almost double that of India’s cell manufacturing capacity(installed) of around 2.95 GW. Read more details here.
PV-tech, the UK based Solar media firm, released the top 10 solar module and cell suppliers in 2016. Not surprisingly, both the lists are dominated by vertically integrated Chinese firms. The lists are available here and here.
Last week we had explained how Electric Vehicles are reshaping mobility and the future belongs to EVs. What better validation for EVs when one of the biggest oil companies accepts the reality and starts preparing for it? Shell announced earlier last week that it will start installing electric vehicle chargers at its gas stations in Britain and Netherlands. Russia has made it mandatory for gas stations to install EV chargers, and oil companies like Total are also betting big on Solar and EVs. More details here.
That’s it this week. Have a nice Sunday.
(This blog series is supported by Aspiration Cleantech Ventures)