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Interaction | November 2013

India remains an attractive market for solar energy

AREVA Solar has been selected by Reliance Power for building a concentrated solar power installation of 250 MW capacity. Siddhartha Ghosal, MD, AREVA Solar, tells Pradeep Pandey that the challenges in the Indian conditions reflect the nascency of technology adoption.

AREVA Solar´s maiden project for Reliance Power is likely to be completed by the end of this year. How was your experience in executing your maiden project in India?

AREVA is in the advanced stage of construction of the solar field. However, we would like Reliance Power to announce the exact date of completion, as they are the owner of the project with visibility to the complete power plant activities. The experience on this project has been challenging as well as enriching. We have developed local skill base, local supply chain and a strengthened base in India. Further, the learnings from Indian conditions for this technology have been captured, simulated and fed back to global R&D for further enhancements.

What were the main challenges during execution procurement, logistics, human capital, government agencies, technological or other?
We did encounter a few challenges like any other market in its early stage of technology adoption (solar thermal). But we have considered them as valuable inputs in our learning curve and are now better equipped for the next phase of project. In the process, we have received excellent support from the government.

You have partnered with L&T, Thermax and EIL. What was the nature of their participation?
We have well defined scope with our partners wherein L&T did the construction of the project. Thermax provided the power block BoP, while EIL worked with AREVA on the EPCM scope.

Will you extend your partnership with these companies in other projects?
We always have a long-term relationship approach with our partners. We look forward to extending this partnership for new projects as well. At the same time, we are also open to work with other similar quality-focused Indian companies.

Which are the other projects you are expected to work on?
We are actively pursuing opportunities including some unique applications like steam augmentation in existing power plants. We are also excited with the prospects of next round of MNRE projects including the ones aimed at demonstrating different technologies.

As compared to solar PV, how economically viable and technically feasible is thermal solar in India considering the geography?
First of all, let me state that both solar PV and solar thermal have their unique positions in the solar power generation sector. Technically, solar thermal is very much feasible but limited to certain states in India depending on factors like DNI. Economically, solar thermal viability is worked out based on much higher capacity utilisation factor (CUF) and effective deployment of storage.

How do you foresee the market for solar energy in India?
India remains a very attractive market for solar energy due to its abundant solar resource, government support as well as the need to reduce overall energy deficit. Solar energy has seen dramatic growth over the last couple of years, and now with its increasing financial viability, we expect this growth to continue. From AREVA´s standpoint, we see a lot of opportunity for the CSP technology in India once the first batch of CSP projects is online. The booster and hybrid opportunities have also received positive feedback, which bodes well for AREVA´s technology. There are challenges to be countered like the enforcement of solar RPO, REC viability and current economic dip.

Cost of solar projects has drastically come down in the past few years; however, the project execution has not picked up. What are the main reasons for this?
Well, the cost of solar projects, or any power project, is mainly driven by the competitive situation and the demand-supply balance. We have seen lot of developments in local supply chain and local project management, which has also contributed in achieving cost efficiencies. However, the solar market in India is in its early days. During such a phase, we are bound to face teething issues like supply quality, logistical surprises, shortage of skilled labour, etc. Also, there is definitely room to improve cycle efficiencies in achieving land acquisition, financial closures and statutory clearances.

By when do you expect grid parity in solar in India? What are your future plans?
We have a robust cost reduction programme to drive down costs. We are also investing in R&D to improve the performance of the system and incorporate storage. It is hard to predict exactly when grid parity will be achieved, but we believe that CSP with storage already offers a compelling value proposition. We also feel that the use of steam augmentation and hybrid projects can provide stable power at even lower prices than are seen today for standalone solar plants.

About AREVA Solar
AREVA Solar designs, manufactures and installs solar steam generators for the global power generation and industrial steam needs of its customers. AREVA serves a broad range of power and industrial steam customers, providing fully integrated solar thermal product offerings, including technology, power generation, industrial steam processes and steam augmentation.

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