Scaling the Distributed Solar is one of the key for India to achieve its solar goals.The growth we see in Indian market is all due to because of very small number of installations. Only 1.4 Giga-Watts of capacity has been installed in the earlier months of this year out of government’s ambitious goal of 40 Giga-Watts by 2022. The stats reflect that India is working slower than required. This means that India needs 100 percent compound annual growth rate every year between now and 2022 – which is a sweltering development rate.
Luckily, Indian market is ripe enough for the development of Distributed Solar expansion. The fall in cost of technology and government’s efforts to reduce the level cost of electricity in order to make rooftop solar competitive makes it adequate for expansion of distributed solar. However, we should remember that the industry is not old, many of the companies are yet in early stage and needs funding to scale, de-risk themselves and get ready for investment.
Listening to the call of the hour, India and United States have partnered, with the help of Indian Ministry of New and Renewable energy, the Indian Renewable Energy and Development Agency (IREDA), Overseas Private Investment Corporation (OPIC), William and Flora Hewlett Foundation, Good Energies Foundation, John D. and Catherine T. MacArthur Foundation, David and Lucile Packard Foundation, and the Jeremy and Hannelore Grantham Environmental Trust –a facility that gives a unique risk attribute of granting dollars that will mobilize finances to Indian Distributed Solar developers in early stage project preparation, named U.S. – India Clean Energy Finance (USICEF). The manager of the program is Climate Policy Initiative.
The main goal of USICEF will be to deploy millions of dollars in early-stage project preparation support, additionally market estimation, product development & testing, and engineering & legal costs. The fund will help developers ready to get commercial investment. The support from USICEF will help in long-term debt financing for distributed solar power from OPIC, IREDA and other public sector financial institutions, this, in turn, will attract more investment from Private Sector.
The announcement was made a year ago and USICEF has recently become operational. The recipients have received the first round of grants; in total it sums to be $900,000 for support in project preparation. The grants are provided by Argo Solar-provider of custom designed end to end rooftop solar power solutions, HCT Sun India –subsidiary of US based HCT Sun LLC, OMC power –integrated rural power utility company, SMG Ventures –implements rooftop solar projects, and SunFunder –experienced debt provider for beyond the grid and sola project companies with grid deficit and many other innovations.
Distributed Solar power developers can apply to USICEF for support from their official website.
The question arises is that whether those developers who are taking grants from the USICEF will reach the scale? After creating the support pipeline for many early stage projects, the answer of USICEF is an empathetic Yes.