“With increasing coal based power tariff, increasing demand for electricity per capita, we are going to need more and more sustainable power. While the government tariffs are dropping dead, the PPAs are showing a sign of recovery. Captive solar power projects still generate healthy returns with break even times as low as 4 years. I still believe that solar is a huge opportunity waiting to be tapped - all over India. If one is worried about the low tariffs, he should simply avoid dealing with government PPAs and instead find private buyers who pay much better.”
Rahul Gupta, Managing Director, Rays Power Experts Pvt Ltd shares his view with Sandeep Sharma about his organisation’s greatest strength in solar power project execution, ongoing and upcoming solar projects, 5.5 MW rooftop project executed for DMRC, business opportunities in the rooftop solar plant segment, need to setup sizable number of Solar Parks, falling solar tariff affecting profitability and vision for the future. Edited excerpts...
Tell us about your organisation's greatest strengths in solar power project execution.
Our company is an expert in Solar Power Project Development. EPC remains our strongest hold in the business. We are well integrated both horizontally and vertically in the solar development lifecycle. Over the last 6 years, we have built valuable relationships pan India with various small to large vendors of equipments, materials, services etc. Our liasoning department works closely with the government of India shaping Solar Policy Making.
Our turnkey services include the complex front-end engineering design, construction, installation and commissioning to long-term operations and maintenance. We deploy integrated technologies and expertise to design, install and commission solar projects, to deliver PV energy solutions that increase energy yield, reduce the LCOE (levelized cost of electricity) and provide stable grid integration, which results in system solutions that maximize value and minimize risk for our customers.
Could you share with us details about your ongoing and upcoming solar power projects?
At this moment, we have developed projects with a total capacity in the excess of 350MW. Other than this, more than 200MW projects are at some stage of execution. We can’t disclose the project developer name. We are currently operating with high intensity operations across Rajasthan, Gujarat, Madhya Pradesh, Haryana & Karnataka.
We have recently developed a new solar park in Bhiwani District of Haryana. The Solar Park is situated in the small town of Siwani and is the first ever and only private solar park of Haryana.
Could you share finer details about 5.5 MW rooftop solar project executed for DMRC?
DMRC is another of our flagship projects in the Rooftop solar category. This projects is unarguably the largest ‘distributed’ solar power project for a single organization. The total project capacity is actually 7.1 MWs and not 5.5 MWs, this project is span across 42 different roofs that make up for switch yards, cleaning bays, offices & other utility buildings owned by Delhi Metro. The largest installed system has a capacity of 725 KWp, while the average capacity is 131 KWp. The scope of work included everything prom equipment procurement, plant design to plant commissioning.
What kind of business opportunities do you see in the rooftop solar plant segment?
I like to think of Rooftop Segment as a sleeping beast. While today, there are difficulties that make the rooftop market unattractive for business potential, I believe that in the years to come the companies that are able to solve financial or logistical problems related to rapid scaling of Rooftop Business will not just survive, but will also lead.
The opportunity is a massive 100Bn$ opportunity and there is plenty of room for many players to grow simultaneously. While the push from government has created a larger than ever awareness about rooftop business, we still are waiting for the day when challenges related to project financing, project logistics & project maintenance will be solved.
What's your take on the need to set up sizable number of Solar parks in India?
Let us look at facts. From early 1990s to early 2000s, Rajasthan was struggling to be counted as a developed or developing state. Infrastructure from road to utility was in bad shape - this resulted in lot or businessmen moving away from their native state to overseas or other states like Delhi and Gujarat in a hope for better lifestyle and bigger opportunities. While just 10 years later in 2015, Rajasthan was the poster boy for solar power across the world. Even today, it accounts for more than 30% of the total solar power capacity installed in the country. Today, Rajasthan has the best road networks, unarguably the best state capital (Jaipur), power surplus and lots of opportunities.
This was made possible because Rajasthan rode the solar tide pretty efficiently. From 0MW of solar power, it went on to 4GW of solar power within 10 years. This accounted for Billions of Dollars of private money infused in Rajasthan, which in turn generated more tax revenue for the government, more employment & checked migration. I think, this simple growth matrix can be replicated across other states too and all of this is possible only if we set up sizable number of solar parks in the country.
With the steep fall in solar based power generation cost, how far it is a profitable venture for companies to bid for such projects?
Government’s preference is lower tariffs and hence the solar tariffs are falling. This is just an indicator of the fact that solar power can be generated, sold and distributed at dirt cheap prices. Though, this doesn’t negate that Solar is not a profitable venture anymore.
With increasing coal based power tariff, increasing demand for electricity per capita, we are going to need more and more sustainable power. While the government tariffs are dropping dead, the PPAs are showing a sign of recovery. Captive solar power projects still generate healthy returns with break even times as low as 4 years. I still believe that solar is a huge opportunity waiting to be tapped - all over India. If one is worried about the low tariffs, he should simply avoid dealing with government PPAs and instead find private buyers who pay much better.
Going forward, where do you see your company five years from now?
We aim to become the leader of the Indian solar industry. We made the first solar park of Rajasthan, First Solar park of India & First Private Solar Park of Haryana - and we hope to continue this in other states. We see our portfolio capacity crossing the 1000MW mark. We also aim to take the rooftop market by storm - a dedicated team is working on developing this vision.