Tata Power sees $1 billion biz scope in rooftop solar plan
Opportunity to unfold over 3 years; co eyes a fifth of the local market for solar modules
The central government’s rooftop solar subsidy scheme for households could present a $1 billion-plus business opportunity for Tata Power, the company’s managing director Praveer Sinha said. The opportunity will play out over the coming three years, as the company looks to corner a fifth of the domestic market for solar modules, Sinha added.
“One place where we will have lot of momentum is the new program of Prime Minister Surya Ghar, where the target is about 10 million homes,” Sinha said in an interview. “That’s a huge upside that will come to us.”
The PM Surya Ghar Muft Bijli Yojana, established this February, looks to provide subsidies for rooftop solar installation to 10 million households. Sinha reckons the scheme could generate demand for 25-30 GW of solar modules over its duration. Tata Power wants to cater to 5-6 GW of this demand, he said.
At an estimated price of 20 cents per watt, according to Sinha, this could translate to a business opportunity of $1-1.2 billion (₹8,350-10,000 crore).
Sinha, who says Tata Power holds 13% of India’s solar module market, wants to ramp it up to 20% on the back of its new solar cell and module manufacturing unit in Tirunelveli, Tamil Nadu. Built with an investment of ₹3,000 crore, the unit can manufacture 4 GW of solar cells and modules each year.
“The manufacturing plant will be fully operational this year. The module (manufacturing unit) will be fully operational (throughout the year) while the cell will be operational for, say, about 9 months,” Sinha said.
The new plant will also give the company
THE
an advantage in the rooftop solar scheme, as the scheme mandates the use of domestically manufactured solar cells and modules.
“Since we have put up the plant, we will be at a huge advantage, because we
scheme mandates the use of domestically manufactured solar cells and modules
SOLAR OPPORTUNITY TIRUNELVELI
plant built in Tamil Nadu will give the firm an advantage in the scheme
will be able to use our own domestic cell and module for this scheme,” he said. “There is just one other domestic manufacturer with a 2 GW domestic cell manufacturing capacity and another one with 2 GW is coming up.”
ReNew Power has a 2 GW solar cell manufacturing unit in Gujarat and an Adani Enterprises unit is setting up another 2 GW plant in the state.
After Tata Power’s new plant goes live, the company’s total installed solar
AFTER
the plant is live, Tata Power’s total installed solar module capacity would be 4.9 GW
TATA
Power will rely on its 500+ channel partners across 450 cities for sale of its rooftop solar units
module capacity would be 4.9 GW including 600 MW annual capacity at its Bengaluru plant. The company also executes EPC (engineering, procurement and construction) projects for solar power through its subsidiary Tata
Power Solar.
Tata Power will be relying on its network of 500+ channel partners across 450 cities for the sale of its rooftop solar units, Sinha said. The company is looking to double its network to 1,000 partners this year, he added.
Tata Power shares have nearly doubled over the past year to close at ₹414.75 on the BSE on Friday. The scrip has lost nearly 10% in the last five trading sessions after the company’s Q4 profit missed street estimates. The power major reported a 15% year-on-year growth in profit at ₹895 crore.
A solar cell is a photovoltaic unit containing semiconducting materials that convert sunlight into electrical energy. These cells are connected in chains to form larger units known as modules.