In the new reported conducted by GTM Research and Bridge to India, The India Solar Market: Strategy, Players and Opportunities, researchers have concluded that over the next five years India will become one of the major players in the solar industry with the installation of more than 9GW between 2011 and 2016.
Researchers cited the ever-evolving National Solar Mission (NSM), state-level incentives and global solar companies as helping to spur the country into a gigawatt-scale market. The report focuses on India’s market dynamics with analysis of solar policy roadmaps, state-by-state demand drivers and domestic manufacturing and technology positioning.
“Solar in India is set to grow significantly over the next 10 years,” said Dr. Tobias Engelmeier, managing director at Bridge to India and the report’s lead author. “This growth will be driven by rising power demand and fossil fuel prices, the ambition of the NSM and various state-level initiatives, as well as by renewable energy quotas, including solar energy quotas for utilities and the subsequent gains in solar cost reduction.”
By the end of 2010, India had installed 54MW of grid-connected solar, but, as the report points out, FiT allocations from NSM and Gujarat’s Solar Policy have sparked a promise to grow the installed capacity to nearly 365MW by the end of 2011 and to over 1,100MW by 2012.
While the solar market in India holds the potential for growth and abounding solar opportunities, GTM and Bridge to India noted that the country does face certain challenges that could possibly inhibit the forecasted growth. The main concern lies in project bankability and financing with banks showing reluctance to finance the first wave of Indian project with national- or state-level feed-in tariffs or power purchase agreements.
“Financing is the number one concern for anyone developing solar in India,” said Shayle Kann, managing director of solar at GTM Research. “To ease that pressure and eventually realize the market’s potential, we expect to see the competitive landscape evolve dramatically via strategic partnerships and joint ventures; India will benefit from the development expertise of global solar incumbents and these incumbents in turn will benefit from having a local partner to navigate the country’s complex energy market.”