The Indian Solar Sector At The Crossroads

A competitive market, driven by a surge in the number of tenders and by falling module prices, has shaped the Indian solar industry so far. The recent imposition of a safeguard duty on the import of solar cells and modules has had a mixed reaction from the Indian solar industry, which is unsure of its impact due to the short time frame.

The Indian renewable energy sector has grown tremendously in the last five years. The solar energy sector, in particular, has grown exponentially, with India soon to become the third largest international solar market after China and the USA. Both by total installed capacity and annual capacity addition, India is now amongst the top five countries on the world’s renewable energy map.

A survey by Wood Mackenzie on the global energy markets, which focuses on the upcoming market shifts, concludes that global demand for energy will keep rising till 2035. However, the nature of the energy mix, the demand centres and the key players will change significantly. The report also indicates that energy demand in India will grow the fastest, at an annual average rate of 3 per cent from now to 2035, by which time the country’s population will overtake China’s.

Considering the ever-increasing gap between the power generated from conventional sources and the country’ actual energy requirements, solar energy is going to play a major role in India’s energy sector. Therefore, solar power, despite the challenges, offers huge opportunities.

The market, at a glance

According to a Bridge to India (BTI) report, total installed utility-scale solar capacity in the country grew by over 70 per cent in 2017-18 to reach 21.3GW. Total solar capacity, including rooftop solar and off-grid systems, reached 24.5GW as of March 31, 2018.