We are helping states make EV policy stable: ABB India MD Sanjeev Sharma

On the utilities side, thermal generation is muted and being replaced by renewable, says Sanjeev Sharma

ABB India commissioned India’s first industrial solar microgrid at its Maneja facility in Vadodara, Gujarat, on Thursday. In an interview, Managing Director Sanjeev Sharma tells Vinay Umarji that the company will look at opportunities in emerging areas such as electric vehicle (EV) charging and power solutions in transportation apart from microgrids. Edited excerpts:

How are the trends in the power sector shaping your business? 

In mid- to long-term, India will invest heavily in three segments that we service — utilities, industries and transportation-infrastructure.
 

There are a lot of non-performing assets (NPAs) available for purchase. Right now, instead of going into greenfield development, the money is going into buying brownfield assets. Until acquisitions of stressed assets are not over, the core sector of industry may not pick up. But in 2-3 years, it will. But consumer oriented industries will do well. 

On the utilities side, thermal generation is muted and being replaced by renewable. Power consumption will continue to grow at 7-8 per cent, and so some source has to supply. At the national grid level, the investments will normalise and will not be very high since the grid has been laid. Investments will happen to provide connectivity to consumers. Transmission projects at state level will come up. We are introducing newer technologies such as microgrid because this is an underexploited area. EV is another such new area. 

What kind of capacity are you building in newer avenues such as EV charging?

We are talking to states who are planning their EV policies and helping them to write the technology in a stable and reliable way. OEMs (original equipment manufacturers) are also testing their cars and buses with our technology. It is an eco-system that we have to build. Just like fuel stations, you will require EV charging stations. But planning capacities will have to go hand-in-hand with penetration of EVs. For every five cars sold, you need one station. But right now the EVs on Indian roads are less than 0.1 per cent. So, typically, it has to cross 5 per cent to gain momentum and 15 per cent to get the majority market acceptance. We will have to pace ourselves accordingly. I think it will take 3-5 years before the mass movement in this area takes place. But we believe fleet agencies such as cabs will go much faster. 

Do you anticipate enough business for setting up conventional coal-based power plants? 

Conventional coal-based energy is muted. If solar or wind energy is cheaper, consumer will prefer these. But if demand goes up and thermal energy wishes to meet it, they need to revamp their plants. A lot of investment will go into thermal plants based on demand than generation. 

What are ABB’s India capex plans?

We will for now continue to invest $100 million per annum in India which will continue to grow. 

Will this Vadodara microgrid be replicated? Could this be a business in itself for ABB?

If you start a mining a project in a remote area, how do you bring power? Instead of using DG sets fully, you can store renewable on the microgrid and use it accordingly. Remote villages can also use this technology and so can industries like ours who have co-generation at their facilities. Industries can supplement this with microgrid.

What is the share of renewable in your order book?
 

It is 15-18 per cent. It keeps going up and down because while solar is strong, wind went down last year due to policies. Now it is coming back again.