Solairedirect, the French company that made history by offering to sell solar power at as low as Rs 7.49 a unit, says it wanted to “send out a message” that solar power need not depend on subsidies and incentives to come within the reach of the common man.
Solairedirect won a 5-MW project under the National Solar Mission's recently concluded second round of bidding-based project allocation, and was one of the two companies that caused the “sub 8 surprise”. (The other bidder, Welspun, offered to sell power at Rs 7.97.)
In an interview to Business Line today, Mr Gaurav Sood, Managing Director, Solairedirect India, stressed that even at Rs 7.49 a unit, the Solairedirect would make money “though not as much as we would have liked to”.
Explaining how the project would generate positive returns, even at Rs 7.49 a unit, Mr Sood noted that Solairedirect was a fully integrated company and was its own EPC contractor too. Further, “whatever we do, we do with a bankability perspective, which brings down costs,” he said. Accordingly, the company has gone in for the established ‘crystalline silicon' technology that the lenders are comfortable with (as opposed to thin-film technology, which is still evolving.) In India, Solairedirect will buy the modules from Jupiter and Websol, he said, adding that, if necessary, Solairedirect could help them in procurement of raw material (poly silicon).
Mr Sood noted that crystalline silicon modules, even if made in India, were competitive with imported thin film modules.
Asked why the company bid only for 5 MW (bidders could bid for any capacity starting from 5 MW up to 50 MW), Mr Sood said that the mandatory bank guarantee was a major limiting factor.
“Even for 5 MW, we had to provide a bank guarantee of Rs 17 crore,” Mr Sood said, noting that for 50 MW it would have been ten times as much. Solairedirect has operations in several countries and could not allocate such large resources to one country.
Supply at Rs 6
Mr Sood said that Solairedirect would like to sell solar power directly to large consumers of electricity and was in talks with a few potential clients.
“The tariff doesn't have to be flat. We can start with Rs 6 a unit with escalations mirroring global energy price movements,” he said.
Solairedirect is also a provider of ‘engineering, procurement, construction' services and is open to taking minority stakes in the projects that it provides EPC services.
“We will stay invested for the period of the power purchase agreement,” Mr Sood said.