‘Low solar power tariff is no irrational exuberance’

Low solar tariffs have economic rationale behind them and are no ‘irrational exuberance’, says R Mohankumar, Senior Relationship Manager – Large Corporates Commercial and Wholesale Banking, IDFC Bank. “It is real, but cautious scepticism is still there in the minds of lenders,” he said at a conference on Rooftop Solar, organised here by the Confederation of Indian Industry.

Solar energy companies who bid low had their own strengths that enabled them to quote such tariffs. However, he said that for a lender the more “beautiful” solar projects were the smaller projects backed by power purchase agreements.

IDFC Bank has, so far, financed 2,500 MW of wind and 350 MW of solar projects in the country. However, the bank is yet to finance a rooftop solar project. The bank has “looked at” a few rooftop proposals, he said, adding that lenders for rooftop solar projects would want to know whether in case of a problem, the plant could be shifted on to some other roof.

The potential for rooftop projects in the country is “unimaginable” Mohankumar said, stressing that there was “no reason why lenders should stay away from this.”

Later, in an informal chat with SunAlphaEnergy’s Director, Puneet Goyal, he said that IDFC Bank was open to entering into a securitisation deal with solar companies that had long-term fixed revenues from the PPAs.

Many speakers and participants said that the rooftop movement is taking off in the country. Tamil Nadu, the state with the largest installed rooftop solar capacity, has 80 MW. Sikkander Amin of the Chennai-based Vigor Solar Energy said that rooftop demand would further grow in the state if the government allowed net-metering also for industries and educational institutions.

Karnataka has rolled out a rooftop programme and has received applications for 832 MW, said Vidya Rani of Karnataka Renewable Energy Development Ltd.

K Venugopal, Co-Chairman, CII-Southern Region Energy Sub-committee and Director, Kasturi & Sons Ltd, cautioned against depending upon government subsidy for the viability of a project. He said that rather than provide subsidies, the governments must provide a “clean working environment free of obstacles.”

Meanwhile, Solar Mango, a Chennai-based solar consultancy, today launched ‘PV Savvy’, a web-based tool that helps those who want to put up solar project know exactly what kind of project the construction company is building for them.

PV Savvy is like a check-list which will tell the user what to expect, after filling in various details about solar panels, inverters, mounting structure and cables, says Narasimhan Santhanam, Co-Founder and Director, Solar Mango.

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