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Cover Story | November 2015

If user invests, payback period is 5-6 years

Kuldeep Jain, Managing Director, Clean Max Enviro Energy Solutions Pvt. Ltd

What benefits and payback does solar power give investors?
If a company is investing its own funds, payback occurs in 5-6 years, with project IRR of around 15 per cent. This also includes tax break benefit for the company that makes such an investment. If the company/client is not investing its own funds, then there is no payback as there is no investment from their side, but the solar project provides ´cheaper than grid´ power from day one, with zero investments by the offtaker of power. Many companies invest in solar projects, even when they may not consume the power themselves. Solar is a high quality investment as it provides upfront tax break (100 per cent depreciation in first year) and the income from sale of solar power is also tax-free for the first 10 years.

What is the status of rooftop solar installations in India?
The rooftop installations in India have considerably grown to a sizeable market of 250 MW. From Delhi to Kanyakumari, in all states, solar power is today 10-25 per cent cheaper to industrial tariffs, even taking into account financing costs. This is creating a tremendous increase in adoption of solar power.

CleanMax Solar also provides a tariff based pricing, popularly called ´opex deals´ to top-tier corporates. This offering has three benefits -
1.Green power through onsite solar plant,
2.Cheaper to grid power price (10-25 per cent discount to grid pricing), and
3.Hassle-free implementation without capex, without need for technology selection decisions and no managerial involvement in plant execution and plant O&M. The company only has to pay a monthly solar power bill (similar to their grid bill) -û only at a tariff cheaper to grid power.

How will government initiatives help the industry?
The Indian government previously provided cash subsidies for solar power, but with lowering cost of the solar installations, such subsidies have been discontinued except for universities and government entities. Many states now have net metering policies in place whereby surplus power (e.g. unused solar power on Sundays) can be exported to the grid, and the grid provides a credit in the bill of the Consumer for the units exported, and only bills the consumer for the net amount (hence, net metering). In essence, this is an idea whose time has come. Its been well embraced by the populace as most individuals like the idea of going green. Key government enablers such as net metering are now in place, and therefore, the industry is experiencing explosive growth.

What are the advantages of rooftop solar installations when compared to field installations and other renewable energy sources?
Rooftop solar falls under the domain of on-site production of power. This means there are minimal losses occurring as power produced is consumed in hyper-local vicinity. Also, in most cases, roof is an idle resource for companies that they could use to save themselves considerable amount of money without any capital expenditure. The maintenance required is negligible in terms of time, effort and money and solves the problem of unavailability of spare ground. There are other soft benefits associated with rooftop projects, like the temperature under the rooftop goes down by 3-4 degrees, thus, providing a more comfortable working environment for the factory workers. It spreads goodwill amongst the client employment team reaffirming the client commitment towards the usage of renewable energy and environment.

What are the initiatives taken by the industry to increase awareness of rooftop solar plants among institutions and citizens? (Give examples of cost efficiency of rooftop solar systems for a households vs grid connection)
The tremendous benefit of solar in form of cheaper and greener form of electricity has begun to spread like wildfire, largely by word-of-mouth publicity, amongst companies. We at CleanMax Solar have seen a 90 per cent repeat business rate amongst our clients. Once a plant or company within a group has adopted solar, and seen positive results, expansion of solar facilities across sites and also across group companies happens very rapidly.

In fact, CleanMax Solar recently held an ´educational´ seminar series ´Are you a part of the solar journey yet?´, aiming to benefit both corporates and individuals. We are an active member of IGCC (Indo-German Chamber of Commerce) and help them promote solar green energy in India by organising conferences and similar events. The latest one was organised in Pune at Tata Communications, Dighi highlighting ´Potential of Solar Energy for Industries´ followed by a plant visit at the same location. Various expositions and exhibitions happen pan India throughout the year. The solar industry is fairly new to our country, but is expected to grow manifold in the coming years.

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17 Oct 2016
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20 Jun 2016
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