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					</table>The group captive model is the most preferred model by the commercial and industrial (C&amp;I) segment as it allows them to not only use green energy but also save 30-50% on energy bills, Pankaj Verma-Head of Business Development at <a href="https://sunsource-energy.com/" target="_blank" rel="noopener">SunSource Energy</a>, said on the sidelines of the <a href="https://www.mercomindia.com/indian-corporates-poised-renewable-transition-trajectory" target="_blank" rel="noopener">Mercom India Renewables Summit 2023</a>.
Verma added that companies opt for hybrid power projects offering round-the-clock power with a capacity utilization factor of up to 50%.
Below are excerpts from the interview.
What is your current operational capacity?
Initially, SunSource was primarily a rooftop-focused business. Three years ago, we entered the open-access segment. Our portfolio, including commercial and industrial (C&amp;I), is 400 MW, and we plan to commission another 300 MW by March 2024.
Most of the development is happening in Karnataka (100 MW). We are also developing 90 MW of projects in Uttar Pradesh and another 25 MW in Tamil Nadu.
What are the reasons behind the surge in demand for round-the-clock (RTC) power?
If you go with vanilla solar or wind projects, the maximum capacity utilization factor (CUF) you can achieve is 20% and 30%, respectively. However, you can achieve a CUF of 40-50% with a hybrid power project.
Beyond that, one has to go for battery storage. With companies going for carbon neutrality, replacing energy from conventional sources with 100% green energy is necessary.
If someone decides to go 100% carbon neutral, they would require both solar and wind. Since most states don&#8217;t allow energy settlement during peak hours, I see real-time settlement gaining prominence shortly.
Currently, hybrid power is the best available option. After Gujarat, Karnataka is also planning to develop a hybrid power policy.
Can you name the top three states for C&amp;I customers procuring power from open access?    
Karnataka has to be at the top. Earlier, it had annual banking, which is now monthly. With the oversizing of the project every year, you could replace 100% of the power annually. It will change with monthly banking, but still, it is one of the best states with oversizing.
The second has to be Tamil Nadu, which also has provisions for monthly banking, and the project size is unlimited.
Then we have Maharashtra and Gujarat, which are at par. Some of the other states that are opening up are Andhra Pradesh, Telangana, Odisha, and Madhya Pradesh.
Out of the captive, group captive, and third-party models, which is the one that is attracting the most attention? 
The unique value proposition is the captive/group captive model. Here, you are procuring green energy and saving almost 30-50%, depending on which state you are in.
But some large MNCs are not free to invest money into equity and are forced to procure power under the third-party model. Under the third-party model, the commercial savings are lower than in the captive/group captive model.
Is various charges imposed by distribution companies (DISCOMs) affecting the wider adoption of third-party open access?   
In Maharashtra, the landed cost of power from the distribution company (DISCOM) is around ₹8.5 (~$0.103)/kWh. Even with the third-party model, you would save nearly ₹1 (~$0.012)/kWh-₹1.5 (~$0.018)/kWh.
In Maharashtra, the third-party model would make sense, but in other states, the power tariffs range from ₹7 (~$0.085)/kWh-₹7.5 (~$0.091/kWh and a consumer can save up to ₹2 (~$0.024)/kWh under the group captive model.
The group captive model would make sense in states like Punjab, Odisha, and Chhattisgarh, where the landed cost comes to ₹5 (~$0.061)/kWh. In these states, the third-party model is not a viable option.
What would be the investment, and how long would it take for a customer to recover the costs for a 1 MW captive or group captive project?   
For a 1 MW project, the equity investment for a customer is ₹4 million (~$48,548). The number of units generated is around 1.5 million.
Given the number of units generated, a consumer can save up to ₹2 (~$0.024)/kWh-₹2.5 (~$0.031)/kWh.
So, the total savings comes to about ₹4 million (~$48,548) for a 1 MW project.
In nearly one year, they can recover their equity. Customers making equity investments can get back their equity during the first year.
Are your customers adopting green energy because they know that not doing so may affect their business prospects, if not now, then soon in the future? 
We have a mix of customers. Some Indian customers understand the value of going green and are committed to their energy transition targets.
Also, we have customers who have business requirements. We are supplying power to one of the largest bottlers for Pepsi and Coke. Companies like Pepsi and Coke are committed to having 100% green energy in their plants. For business requirements, they need green energy, or their business is in danger.
How will waiving the interstate transmission system (ISTS) charges affect the C&amp;I business? 
The ISTS waiver keeps the equation the same. The government has waived the ISTS transmission charges, but when one enters a state, he has to pay the cross-subsidy surcharge, additional surcharge, and all the other charges.
The waiver of ISTS charges is going to help consumers who are multi-locational. For example, a consumer&#8217;s requirement is 100 MW, and they sign a power purchase agreement (PPA) with the developer, and the developer supplies power to all the plants across the states. The benefit is that the power can be supplied in states that do not favor open access. The only approval required is a no-objection certificate from the states.
The Approved List of Models and Manufacturers (ALMM) has been kept in abeyance for a year. How will it affect the developers, given that projects with imported modules must be commissioned by March 31, 2024? 
In the short term, we plan to commission 300 MW of projects by March 2024, for which the procurement has already started.
For the future, planning needs to be done. We can&#8217;t import 400 MW-500 MW of modules and keep them in store for future projects. That is not a viable option. As soon as the ALMM announcement was made, the module prices came down to $0.21 (~$0.002)/Wp.
The developers got few benefits even when the ALMM regulation was in place. The domestic modules were only 5-7% cheaper than the Chinese modules. Also, the tariffs have come down by about ₹0.25 (~$0.003)/kWh from what it was nearly six months ago.
What would SunSource do differently after being acquired by a Netherlands-based company last year? 
SHV Holdings is a Netherlands-based company in India as SHV Energy. The name of the brand in India is Supergas. SunSource was acquired in November last year, and now we are a part of SHV Energy.
The acquisition has given us access to capital, which makes us competitive, and we also have aggressive plans for the future.
We are expanding across five to six states, and by 2026, we intend to be a GW company in the C&amp;I segment.
<div>(Note: Sections of the interview have been paraphrased for better reading. Check out the video for a full chat)</div>
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Group Captive is the Most Preferred Open Access Mode for C&I Customers: Interview

The Ministry of New and Renewable Energy (<a href="https://mnre.gov.in/solar/current-status/" target="_blank" rel="noopener noreferrer">MNRE</a>) has issued an advisory saying that the power energy departments and distribution companies (DISCOMs) in three states should consider permitting rollover of banked electricity as the power demand has plummeted in recent weeks.
The Ministry had received representations requesting to issue an advisory to the states of Andhra Pradesh, Karnataka, and Tamil Nadu, to allow the rollover of banked electricity from solar PV rooftop projects and open access renewable energy generating stations under captive and third-party sale.
The MNRE has advised the rollover of banked electricity for the financial year 2019-20 and 2020-21, to the next FY 2021-22. Banked energy is settled each year, but given the unprecedented situation caused by the pandemic, the Ministry has now said that it can be carried forward to the next financial year.
After the COVID-19 outbreak hit India, the Government of India (GoI) called for a 21-day country-wide lockdown, which has now been extended to May 3, 2020.
The Ministry of Home Affairs (MHA) recently <a href="https://mercomindia.com/lockdown-renewable-projects-construction-resume/" target="_blank" rel="noopener noreferrer">issued</a> its revised guidelines allowing selected additional activities to keep the wheels of the economy turning. The announcement has come as a big respite to the renewable industry as the construction of renewable energy projects will now be allowed from April 20, 2020.
Due to the nationwide lockdown in the wake of COVID-19, industries and commercial establishments using electricity generated directly as well as through banking from solar rooftops and open access under captive and third-party sale, are running their operations at their lowest capacity and consequently, their demand of electricity has reduced to a minimum.
The Ministry observed that due to the dip in demand for power, the generated and banked units in previous months could not be utilized by the consumers.
According to the Ministry, the lapse of such banked units or purchase at the average pooled purchase cost (as is typically done) would severely affect the profitability of both the developers and consumers of solar PV rooftop projects and open access renewable energy generating stations.
The MNRE also warned that the situation might continue for another two months until the pandemic is controlled, and the industrial production and commercial activities return to normalcy.
The MNRE earlier <a href="https://mercomindia.com/discoms-force-majeure-curtailing-renewables-null-void/" target="_blank" rel="noopener noreferrer">reiterated</a> that the ‘must-run’ status of renewable energy projects would remain unchanged during the COVID-19 lockdown period and curtailment or renewables other than for grid safety reasons would amount to deemed generation. The Ministry had also noted that some of the distribution companies are still resorting to the curtailment of renewable energy without any valid reasons.
The Ministry of Power (<a href="https://powermin.nic.in/" target="_blank" rel="noopener noreferrer">MoP</a>) had also issued instructions providing a moratorium period for distribution companies for making payments to electricity generating companies due to the Coronavirus (COVID-19) outbreak.
In the wake of COVId-19, government services, industrial and business sectors have been severely affected, and the power industry is facing the problem of subdued demand, low collections, and difficulty in operationalizing assets. You can track the latest updates related to the impact of COVID-19 on renewable and power industries <a href="https://mercomindia.com/mercom-coronavirus-live-updates-clean-energy-india/" target="_blank" rel="noopener noreferrer">here</a>.

MNRE Directs Three States to Allow Rollover of Banked Energy Amid COVID-19 Lockdown

The Haryana Renewable Energy Development Agency (<a href="http://hareda.gov.in/" target="_blank" rel="noopener">HAREDA</a>) has amended its guidelines for megawatt-scale ground-mounted and rooftop solar photovoltaic (PV) projects meant for captive consumption or third party sale. These guidelines fall under the Haryana Solar Power Policy 2016.
Under the policy guidelines, developers can install at any location in the state, but they must interconnect these projects with stations of 11 kV capacity or greater.
HAREDA has now amended a provision related to the exemption of wheeling, transmission, cross-subsidy charge, and additional surcharges.
Key Points from the Amendment
·         Wheeling and transmission charges will not be levied for 10 years from the date of commissioning for all those captive solar PV projects which have submitted applications for its registration, purchased land or have taken the land on lease for 30 years and have bought equipment and machinery or invested at least ₹10 million (~$0.14 million)/MW to set up such captive solar PV projects till February 13, 2019.
·         To determine the investment of ₹10 million (~$0.14 million)/MW, payment for equipment should be made into the bank accounts of equipment supplier before February 13, 2019, and proof of the same must be submitted.
·         Cross-subsidy surcharges and additional surcharges are not applicable for captive solar PV projects according to the provisions of the Electricity Act 2003.
·         No waiver of wheeling and transmission charges, cross-subsidy surcharges and additional surcharges will be given to solar PV projects set up for the third-party sale of power.
·         Against the waivers, renewable purchase obligation (RPO) benefit will be provided to power utilities/distribution companies.
·         Banking will be provided for captive/third-party solar PV generation projects, but applicable banking charges will apply.
<a href="https://mercomindia.com/haryana-solar-open-access-charges-waiver/">In 2018</a>, HAREDA had issued guidelines stating that wheeling charges, cross-subsidy charges, transmission and distribution charges, and additional surcharges will be completely waived for third-party sale or open access consumers of energy from ground mounted or rooftop solar projects commissioned during the control period.

Haryana’s Amended Solar Policy Provides Exemption of Wheeling and Cross Subsidy Charges

Based on project capacity commissioned in 2017, <a href="http://sterlingandwilson.com/" target="_blank" rel="noopener">Sterling and Wilson</a> has emerged as the leading solar engineering procurement construction (EPC) developer in the country.
The newly released report by Mercom India Research <a href="https://mercomindia.com/product/mercoms-india-solar-market-share-report/" target="_blank" rel="noopener">India Solar Market Leaderboard 2018</a> reveals the market leaders that emerged from a record year for the solar industry. The report covers market share and shipment rankings across the Indian solar supply chain in 2017.
Sterling &amp; Wilson accounted for 12 percent market share and was the top EPC firm in India in 2017 and was the also the top EPC provider in India in terms of cumulative installations.
<a href="https://mercomindia.com/wp-content/uploads/2018/06/man.png"><img loading="lazy" decoding="async" class="aligncenter size-full wp-image-10431" src="https://mercomindia.com/wp-content/uploads/2018/06/man.png" alt="Sterling and Wilson Emerges as India’s Leading EPC Player in 2017" width="390" height="265" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2018/06/man.png 390w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2018/06/man-300x204.png 300w" sizes="(max-width: 390px) 100vw, 390px" /></a>
Sterling and Wilson was the only EPC which had over 1 GW of commissioned capacity in 2017.
“The EPC market was dominated by large firms which occupied the top ten spots and accounted for 63 percent of market share. But, only one company had over 10 percent of market share,” said Raj Prabhu, CEO of Mercom Capital Group.
Most large developers have begun executing EPC services in-house on some projects to control costs.
Competition is intense among EPC companies as barriers to entry are low. Cost cutting and poor quality EPC work was exposed when storms affected the north Indian states of Uttar Pradesh, Rajasthan and Haryana and <a href="https://mercomindia.com/storms-affect-solar-assets-north-indian-states/" target="_blank" rel="noopener">damaged</a> solar projects.
Margins for EPC providers is razor thin due to aggressive bidding for EPC services by providers. Several small and medium size EPC providers are struggling.
With approximately 20 GW of solar projects tendered since December 2017, the development activity is expected ramp up as these tenders are auctioned. Solar installations in Q1 2018 <a href="https://mercomindia.com/solar-installations-india-q1-2018/" target="_blank" rel="noopener">totaled</a> 3.3 GW and Mercom India Research has forecasted solar installations in 2018 to come in at approximately in the 8-9 GW.
To learn more about the report and get a full list of market leaders, click <a href="https://mercomindia.com/product/mercoms-india-solar-market-share-report/" target="_blank" rel="noopener">here</a>
 For a complete Market Share Tracker, click <a href="https://mercomindia.com/product/mercoms-india-solar-market-share-tracker/" target="_blank" rel="noopener">here</a>
Download Executive Summary <a href="https://mercomindia.com/india-solar-market-leaderboard-2018-executive-summary-form/" target="_blank" rel="noopener">here</a>
Image credit: Flickr

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