Recent time witnessed Solar Energy Corporation of India (SECI) rising the upper tariff ceiling for its 10 GW of interstate transmission system (ISTS) connected solar photovoltaic power projects. This can be considered as a move towards the right path, factoring in lack of developer interest in recent solar projects. Although, Indian solar initiatives have earned commendation for making incredible growth trajectories (5 GW solar capacity in 2015, 10 GW in 2016 and ~24 GW in 2018), policy interventions are needed to protect and prioritize the solar industry for continued success.
GST is undoubtedly one of the bold reformations that promised to change Indian economic landscape for good. It has led to standardization of indirect tax laws, thus making them business friendly and intelligible for investors. Cascading of taxation was also removed by GST, which was the biggest problem with previous tax regime. All this significantly leads to ease of doing business in India.
However, aside from offering benefits, has also presented some challenges for nascent solar industry of India. Indian solar industry made incredible strides in recent years reaching 21 GW installed solar capacity in 2018 Q1 from a meagre 10 MW in 2010. New projects are being introduced, and investor interest in Indian solar sector is growing. In this scenario, policy reformations could have opened up even bigger opportunities for growing solar industry, leading India out of energy scarcity.
Director General of Trade Remedies (DGTR) initiated Safeguard Duty investigation on import of Solar Cells, whether or not assembled in panels or modules in December 2017. The Director General of Trade Remedies in its preliminary findings recommended to impose 70% safeguard duty on imported solar cell and modules imported in India. Recently Committee of Secretaries decided to not impose Safeguard Duty based on preliminary findings and it decided to take call on duty once DGTR releases it’s final findings. However, we should evaluate the scenario that will unfold if the duty is imposed.
Safeguard Duty: A Boon or Roadblock?
Indian solar industry is growing and the consistent progress portrays the Government initiatives in a bright light. However, the industry is still at a nascent age and requires constant support in development of a favourable environment for growth. And although, protecting domestic manufacturing industry seems to be the right move (Domestic players had a market share of 13 per cent in FY15, which is estimated to decline to 7 per cent in FY18), we have to understand that blanket Safeguard duty could lead to counterproductive results.
Solar module is the centre of solar technology. And although there has been a considerable technological evolution in solar module development for more efficient solar energy generation, consistent growth is needed for successful transition of green energy source into mainstream energy. To win over the fossil fuel and to stay constantly viable as an energy source, the world needs to make sure that solar energy generation is consistently increased while need for space is reduced. Better cell usage, advancing junction properties, screen printing, doping are few of the many ways how energy yield maximization is assured through solar modules. Continuous advancement in cell & module technology is the only way to keep solar energy relevant in today’s fast changing world to match energy generation and usage pattern.
Daily global CO2 emission level currently stands at 406.47 ppm (parts per million globally). Taking the hints from deteriorating environment, and identifying fossil fuel generation and consumption to be the primary reason for CO2 increase, the world is quickly adopting green energy. Since, global transport system plays a major role in adding to the CO2 levels, it is very important to bring the green energy utilization in transport systems as soon as possible. Since Solar energy has gained world wide acceptance due to its feasibility, easy to install, and reliability, solar energy growth and EV growth have become interconnected.
EV and Solar Energy Growth are Interconnected
Since India has made huge strides in renewable industry development, the country is considered to be an ideal platform for Electric Vehicle (EV) market growth. It is important to highlight that, 10 cities from top 20 most polluted cities in the world are in India, and a third of PM (particulate matter) pollution in India is from transportation sources. Additionally, in 2015-16 India’s crude oil imports are more than 80% amounting to $81.5 billion, and transport sector is the biggest consumer of crude oil with usage of 70% of diesel and 99.6% of petrol. Therefore, focusing on EV market growth depending on renewable energy (especially solar) would help India save billions of forex outflow, and reduce dependency in fossil fuels.