Tata Power has signed an agreement to purchase the entire holding of its solar power joint venture partner BP Alternative Energy Holding. The move follows British oil major BP's announcement earlier this month that it plans to quit solar business worldwide as they were not profitable.
Tech pact
Tata Power will enter into a new technology agreement with BP to access certain technology till 2013. To provide a smooth transition in respect of branding and fulfilment of recertification requirements for solar PV (photovoltaic) modules, both the companies have agreed for a transition period for product and non-product related rebranding and certification, said Tata Power in a press release on Tuesday.
Incorporated in 1989, the joint venture was for manufacturing PV cells and modules. The company has 125 MW solar module manufacturing capacity in Bangalore. Tata BP Solar sales stood at Rs 906 crore in 2010-11.
‘No impact'
Mr Anil Sardana, Managing Director, Tata Power, said the company would like to reiterate that Tata BP Solar is not impacted by the decision of BP to exit its solar business.
“We believe the favourable policy environment has led to an increase in the size of the solar module and solar cell market in India and is a great opportunity for the company to grow and capture a healthy market share,” he added.
Policy boost
The Jawaharlal Nehru National Mission has set a target to achieving production of 20,000-MW solar power by 2022. It offers special incentives such as solar power purchase obligation, attractive feed-in-tariffs and incentives to set up land-based and rooftop solar installation.
A few States such as Gujarat, Maharashtra and Tamil Nadu have come out with solar policies incentivising solar power projects. The policy also lays emphasis on usage of indigenously manufactured modules for getting these incentives.
Further, according to the studies done by various independent agencies, the size of the solar market in India will go up to anywhere between 800 MW and 1,200 MW by 2014-15, said a Tata Power press release.
Shares of Tata Power on Tuesday were up two per cent to Rs 90 on Tuesday.