The rapid growth in India’s solar sector is creating new avenues for companies to grow. In particular, the integration of solar with power back-up technology at the residential level is poised to see some of the fastest growth, according to Sachin Bhalla, vice president of marketing for Luminous India. Luminous India is a subsidiary of Schneider Electric, one of the largest inverter suppliers in India. Mercom India recently sat down with Bhalla to discuss these changes, and a transcript of that interview follows:
What is your view of the Indian solar market?
The solar power sector is a fast-developing industry in India. While the solar farms market has evolved to a certain extent, the residential solar market is still in its incubation phase and an exponential growth period is just around the corner. We expect component prices to stabilize further and, with the kind of government push the sector is getting, the future is looking bright.
Also, there is a need to educate consumers about solar power generation technology, its relevance, and its benefits in order to enable them to decide which type of system is best to meet their requirements.
What is your current market share and what are your expansion plans?
In the rooftop solar segment, Luminous has a 10 percent market share. The company presently generates 15 percent of its revenues from solar verticals, where they are present in the component supply segment. If we look at a five-year horizon, the solar market is expected to grow to become more than 20 percent and this 15 percent (solar business of the company) should become at least 30 to 35 percent of our business. Luminous is currently working to enhance the sophistication of its solar offerings.
What market segment has the best prospect in the coming years in India?
While we believe that the entire solar market and all segments associated with it will grow at a rapid pace, the integration of solar with power back-up technology at the residential level will make this sector register fastest growth. There will be a much higher adoption of solar at one part of the business as well. So, we expect to see big growth from the residential and small commercial rooftop segments.
How is the market for micro-inverters in the Indian solar industry?
This technology is at a nascent stage right now and it has not yet proven its relevance over its string counterparts. As the technology evolves and the adoption rate increases, the market may shift to microinverters as these allows users to scale up their capacity as needed without any hassle.
Does Luminous offer any financing solutions for its customers?
We are in talks with major financial institutions to provide customers with financing options for solar-based solutions.
Can you describe what types of cost and technology trends you see for solar inverters and panels in India?
We don’t foresee a big price change in solar inverters as the pricing is already very competitive.
In terms of microinverters, the market is at a nascent stage and the jury is still out as to whether they will be successful in India, so it is too early to comment on their cost technology trends.
We have seen great declines in panel prices over the past few years and those prices are stabilizing as we speak. Local panel production is being encouraged by the government and that should bring prices down further.
Improving manufacturing technology has led to a reduction in the cost of solar panels, which has resulted in a reduction in the cost of solar power generation. A reduction in the cost of solar power coupled with strategic government policies has resulted in an increase in the overall proportion of solar power in the country’s energy mix.
Which kW size of solar inverter has the greatest demand in the Indian solar market?
Since we are more focussed on solar power generation systems for residential and small commercial back-up power requirements, we can say that in this segment, products in the range of 3 kW to 5 kW are being sought after the most.
What are your offerings in the Indian solar sector?
We are bringing new technology to the consumer and making it relevant to him and at an unparalleled pace. We are not just a solar inverter and battery company – we are a solar power generation system company that provides end-to-end solar solutions to consumers and with a hassle-free experience. We also make our solar offerings easy for our channel partners to deploy, which in turn benefits consumers.
Do you have any comments on how energy storage could be a game changer in terms of technology and cost trends?
Currently, lead-acid batteries are typical (for energy storage) but we foresee new technologies such as lithium-ion batteries bringing greater value to the overall solar ecosystem. There are indications that the cost of li-ion batteries will follow the same trajectory as that of panels, ultimately making them more viable for the end user. Another positive aspect to it is the evolution of hybrid inverters, as in India we have emergency power requirements to fill during power cuts.
How is the GST impacting the solar inverter business?
The impact is neutral.
Image credit: Luminous India