Mahindra group's three-year-old foray into the solar power sector is in the midst of takeoff. The company says that it could set-up as much as 500 megawatts of solar power in the next 24-36 months.
This opportunity however is not restricted just to the projects it had won during the national solar mission. It has already set-up a five megawatt power project, and yet another 33 megawatts power project, both under the tariff-based bidding as a part of National Solar Mission.
In addition to these, the company is looking at a private power purchase agreements to set up rooftop solar power installations for private companies as well. “We are looking at off-grid products using solar in rural areas, and we believe that solar products can replace or supplement several applications which currently run on gensets,” said Parag Shah, Managing Partner at Mahindra Partners & Head of Mahindra CleanTech.
The company is also looking to leverage strong presence of the group in rural areas. Mahindra & Mahindra has extensive distribution in villages across the country owing its tractors and farm equipment business.
The company's off-grid solar business will also include solar products like solar irrigation pumps, solar lights, solar water purifiers and lanterns. “We have already launched two products and working on other products,” said Shah.
Apart from its products and being a grid producer of solar power, Mahindra is also looking to orders to execute engineering, procurement and construction (EPC) of solar power. For its group's electric car, e20 too, they are looking to set-up solar power charging points. This is being treated as a pilot project.
It has also recently received a bulk order from an undisclosed telecom tower company to provide solar power to towers which are now run by diesel. “In addition to being green, using solar power can also cut down a lot of pilferage,” said Basant K Jain, Chief Executive Officer of Mahindra EPC & Solar. The EPC company has already set-up as much as 65 megawatts and hopes to bag orders to execute as much as 600-800 megawatts in three years.
Jain says that there are many such opportunity where companies and organisations are looking for expertise to set-up and maintain solar power projects. “Real market is in the rooftop. Solar power on grid can see saturation or might have land constraints, but not for rooftop,” said Jain.
However, the price structure for solar power on rooftops could be higher as it requires certain amount of customisation for each product. But many corporates which have green agenda like public sector utilities, institutions and corporates too are looking at solar. The group's real estate venture, Mahindra Life Spaces might be looking an extended rooftop projects.
“There could be microgrids in rural areas as well,” said Jain. The opportunity only for EPC in solar could be as high as 1,000 megawatts in another three years.
Mahindra also believes that solar power will have a larger play in grid connected power as many states are being taken to task for not fulfilling their renewable power obligations. Once the rule of buying renewable power is executed by the regulators, more solar power would be required to flow into the grid. “Solar is at a tipping point in its lifecycle and the government is making several efforts to help it succeed and help India's energy security,” said Shah.
The prices of solar power too have changed for the better, the company claims. Before the tariff-based bidding came into play, three years back, solar power was being sold at rs 17.9 per unit. The bids recently were as low as Rs 7 per unit. “There has been a substantial drop in the capex for solar power as well,” said Shah.