SOLAR REC MARKET NOW VIABLE IN INDIA’ REVEALS NEW RESEARCH
BRIDGE TO INDIA, a solar market analysis and consulting firm, has revealed that solar RECs will now increasingly prove to be an attractive off-take for investors in the Indian solar power market in its latest edition of the quarterly, the INDIA SOLAR COMPASS
The January 2012 edition of the quarterly market analysis report, the INDIA SOLAR COMPASS, by BRIDGE TO INDIA has revealed that the market for Solar Renewable Energy Certificates (RECs) is now viable in India. The INDIA SOLAR COMPASS analyzes how the market is a lucrative option for developers and is soon going to see many projects using it as an off-take.
According to BRIDGE TO INDIA analysis, RECs can potentially provide a significant demand-side pull for solar energy and a second viable off-take option for developers. The main demand driver for the solar REC market is the Renewable Energy Obligation (RPO) enforced on power utilities. The supply of solar REC is governed by the number of solar projects registered under the REC scheme. As of December 2011, there has only been one project registered. So far there has been no supply of solar RECs on the market.
However, according to BRIDGE TO INDIA assessment, given the guarantee in REC prices for the period 2012-2017 and considering the CERC set floor price of INR9.3 (€0.16)/kWh (set by the CERC) during this period, project IRR’s become attractive to both strategic and financial investors. This makes the REC revenue stream extremely lucrative in the first few years of the projects. The future of the solar REC mechanism can also be understood by drawing conjecture from the non-solar REC market, which is showing early signs of promise. The January Edition of the INDIA SOLAR COMPASS goes into this in detail.
“The solar REC market is expected to follow the non-solar REC market trend for two reasons“ says BRIDGE TO INDIA solar expert, Mr. Mohit Anand. “Solar technology is rapidly maturing as many companies move into the solar market. The last quarter of 2011 saw an astonishing 101 MW capacity addition, suggesting that solar technology is now established itself as a prime renewable energy choice in India“. Moreover, continues Mr. Anand, “the NSM saw an average bid of INR8.5 (EUR 0.14) while state policies of Gujarat are also expected to implement reverse bidding which would lower offered tariffs. This makes the REC market an extremely lucrative alternate to developers“.
About BRIDGE TO INDIA:
BRIDGE TO INDIA is a consulting company with an entrepreneurial approach based in New Delhi, Munich and Hamburg. Founded in 2008, the company focuses on renewable energy technologies in the Indian market. BRIDGE TO INDIA offers market intelligence, strategic consulting and project development services to Indian and international investors, companies and institutions. Through customized solutions for its clients, BRIDGE TO INDIA contributes to a sustainable world by implementing the latest technological and systemic innovations where their impact is the highest.
About INDIA SOLAR COMPASS
As part of their extensive research on the Indian solar market, BRIDGE TO INDIA produces a quarterly market analysis report, The India Solar Compass, which provides key insight and analyses on the latest developments in the market. Subscribers include leading international component manufacturers, EPCs, project developers, investors, banks, insurance companies as well as public sector players and international organizations. To subscribe, call Mr. Mohit Anand on +91 (11) 46 08 15 79.