Everyone is very much aware that the current pandemic situation has changed the way world worked say one year before, or at-least the way businesses used to run then. Downward change in wages and manpower are still prominently visible across all industrial sectors with no stop in sight. Yet while these incidents are happening, you might be surprised to know where the already beat up solar industry is heading towards.
To prevent the growth and spread of corona positive patients, nearly all major countries imposed weeks or months of nation wide lockdowns. These lockdowns pushed business transactions lower and lower on the negative effects, some positive side effects also were visible. Our environment and nature benefited quite a lot by this. All the fossil fuel guzzling cars were parked at home and this resulted in steep reduction in the atmosphere green house gasses. In fact, Delhi solar plants witnessed 8% increase in their energy output due to this reduced car emissions. Nature took over and animals in city streets were a common site in every corner of the world. It gave our mother earth a small breathing space to recover a bit from all the human activities !
Solar Industry Amongst the Pandemic:
While everyone knows that solar power is green and this is a waking point on how we humans are wreaking the planet. Another aspect of this solar power is that it is cheap, extremely cheap. And during this time of crisis when all the industries are looking for cost reduction in their working capital, this is a very good entry point for them.
Adapting or changing over to the solar power, the savings are diffrent for every one considering their load and the state they are in. For example, industries who install solar plant in Maharashtra benefit extremely then Industries in other states only due to the fact that the per unit energy rate is very high in Maharashtra.
This seems a good point for the solar industry as a whole to get a major boost all over the world. Specially when it has been dominated in the past by cost reduction rather than quality improvement. As more and more industries start to adopt this cheaper and greener energy source, we can expect a significant boost in quality products used in the plant installation.
As for the residential solar segment, it has been dominated greatly by low quality subsidised solar plants in the past, which is changing now due to the fact that multiple solar companies have started to not register themselves on the subsidy front with the local authorities. The major reason for this is that the guidelines set by MNRE and the local authority are very punishing for the solar company as well as the customer. The end result is that the customer installs a low quality plant, gets subsidy amount after 2 years maybe and realises that he might have saved more money if he has just chosen to install a non-subsidy but premium quality one. The reason for this realisation and customer readiness to forgo subsidy is hugely attributed to the fact that there have been early adopters who installed a subsidy solar plant and realised their folly.
Solar plant adopters are not expected to grow in the residential segment due to the COVID pandemic reason and also residential people consider their electric bill as a fixed monthly expense and very few think about saving money there. Yet we are already seeing a positive and welcoming change already in this segment due to the overall awareness in solar energy not relating to the covid pandemic.
Effect on Components used in Solar Plants:
As much as 80% of the solar plants materials are imported from China.To fulfil the requirement of installing solar plants in India by Indian made components, the country needs a long term proposition and good help of the government. For a EPC company installing a subsidy solar plant, the government forces using DCR solar modules which have cells made in India. The main issue here is, that the cost of these modules is comparatively higher than the internationally procured ones even after paying the extra taxes, duties and import charges! One more important factor that we have found by observation is that the DCR modules used tend to have lower energy production capacity than the NON-DCR or internationally procured ones.
"In the post COVID-19 period, developers and contractors may go back to Chinese modules and cells if we don't give a good quality and cheaper alternative which is made in India," Managing Director and CEO Ashish Khanna (TATA Power)
This does not mean that India does not have the technology or the ability to scale and produce better quality components. There are better solar modules available which are made in India but just do not fulfil the DCR requirement. Coming to the second major component of the system which is Inverter, it is purely imported from China for now. If not the inverter as whole, but at-least the spare components required for them are. Fulfilling these in quantity and scale required in India won’t be possible without high investment in the same.
Going forward we believe that the industry is sure going to be growing after COVID crisis. Realisation of environmental preservation and to control the electricity costs will be the two major aspects driving this demand.
If you are a industry or individual planning to install solar rooftop pv plant, you can check out our other articles to decide which type of plant is suitable for you here, or some reasons to install solar plant here.