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CSR: Challenges of Solar in India

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In recent times clean energy is getting a lot of attention across the globe. With increasing temperatures because of excess use of fossil fuels, the carbon emissions across the globe has resulted in a 2-degree rise in temperature in the last century. As a result of this, about a million species in the world are at risk of extinction according to a recent study by the UN. The alarming details have encouraged the countries of the world to encourage and promote the use and production of clean energy, such as solar energy, hydroelectric energy, biomass, wind power, etc.

The solar energy sector is emerging rapidly in the world. Recently, India achieved the third rank globally for solar installation capacity. Mercom India, a clean energy research organisation, has reported that the installed solar photovoltaic (PV) capacity in the country has reached over 28 GW as of December 2018.

However, this accounts for only about 5.5 per cent of the total global cumulative installations. India may have emerged as the third largest market for solar, but a comparison at the global front suggests that India has a long way to go in order to become a solar superpower.

India has a target of installing 100 GW of solar capacity by 2022 and is still 72 GW short of it. To achieve this ambitious goal, a ramping up of the yearly targets is the need of the hour.

Firstly, to achieve the target, India needs an investment of $65 billion in the next four years. In the last 18 years, the country was able to attract foreign direct investment (FDI) worth $7.5 billion according to a report by the India Brand Equity Foundation. Other than this, a major part of this investment has to be raised within the country.

Second, the factors causing negative growth of the solar sector in CY 2018 such as the confusion along the GST and the import duty on solar equipment, are yet to be resolved completely.

Thirdly, India needs to buck up on the domestic manufacturing front. Various efforts by the Solar Energy Corporation of India (SECI) to attract bids for the development of the Inter-State Transmission System (ISTS) connected Solar Photovoltaic (PV) Power Plant since May 2018 has been in vain.

Lastly, the Indian manufacturing sector has yet to kick-start. Therefore, the capacity addition will be done at the expense of imports. Solar cells and PV modules worth about $20 billion need to be imported in the next four years.

India needs a more comprehensive approach in order to achieve its targets. Alternate demand has to be generated through open-access platforms in the situation when discoms are violating the Power Purchase Agreements.

Thank you for reading. Your thoughts and inputs will genuinely make a difference to us. Please drop a line and help us do better.

Regards,
The CSR Journal Team

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