SolarQuarter Magazine January 2017

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Volume 06. #1. January 2017

Solar Operations and Asset Management Special

INR 300

India Contact: Arjun Prasad Sah Mobile: +91- 88267 48995 E-mail: arjun@linuo.com

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Index

Advanced Master Classes On

NEWS at glance National / State / Global...................................................................Pg 4 - 5 In Conversation Mr. Sandeep Upadhyay, Managing Director & CEO, Investment Banking, Centrum

GST FOR INFRASTRUCTURE AND EPC PROJECTS 24 FEBRUARY 2017 HOLIDAY INN, NEW DELHI

Infrastructure Advisory Limited.........................................................................................Pg 9 Mr. V.V. Kamath, Managing Director, Fronius India Private Limited.........................Pg 11 Mr. Manoj Kumar Upadhyay, Founder & Chairman, ACME Group .........................Pg 16 Mr. Prabhu Ramachandran, Director, WebNMS.............................................................Pg 17 Mr. Amit Khurana, Managing Director, MI Solar ..........................................................Pg 23 Mr. Narendra Badve, Director and Country Head - Sales (Industrial Power Control), Infineon Technologies India Pvt Ltd.................................................................................Pg 23 Industry Perspective...........................................................................................................Pg 13

EVENTS TO BE ANNOUNCED SOLAR ENERGY CONTRACTS AND BIDDING FORUM, MAY 2017 INDUSTRIAL ENERGY MANAGEMENT, MAY 2017

Industry Insights Taking Solar Asset Management Seriously........................................................................Pg 6 Elements of a Solar Asset Management Agreement.......................................................Pg 12 Rooftop Solar Sets A Scorching Pace.................................................................................Pg 19

COMPREHENSIVE MASTERCLASSES FOR FUTURE BUSINESS LEADERS OF THE INFRASTRUCTURE SECTOR

REGISTRATIONS Pratika Jathan / Kawaldeep

Opportunities & Complexities in Solar Power Forecasting...........................................Pg 21 Why Asset Management Is Making A Big Entrance On The Solar Scene....................Pg 22 Valuation of Solar Generation Assets..........................................................................Pg 25-26 Product Feature .............................................................................................................Pg 18, 20 Company Feature...........................................................................................................Pg 15, 20 Data Analysis And Statistics ............................................................................................Pg 26

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UR IT YO EF S EN TE ER S T D B RA I G N P RE S A OU R M A G TE OM FR

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NEWS

National Punjab solar power companies seek more time for setting up units Punjab electricity regulator had in January last year approved the exemption for renewable energy projects set up in the state between from July 9, 2015 and March 31, 2017 to boost renewable energy projects.

India as a solar power bright spot helps fill Japan, China slowdown India may be a bright spot for global solar markets this year as it adds capacity at a record pace, becoming one of the top regions for panel producers struggling with rockbottom prices. India is expected to add nearly twice as much new solar as last year, outpacing once-booming Japan, according to forecasts by Bloomberg New Energy Finance (BNEF). China, the world's largest renewables market, will see solar growth dip by about a fifth after peaking in 2016, London-based BNEF predicts.

Anant Geete opens BHEL’s solar cell, module production lines Heavy Industries Minister Anant Geete today inaugurated BHEL's state-of-the-art 200 MW solar module and 85 MW solar cell lines in Bengaluru.

The post Anant Geete opens BHEL’s solar cell, module production lines appeared first on The Financial Express.

porting clean energy, whether it is announcing renewable energy targets and thereon augmenting them, or advocating utilisation of solar power by constituting 121 country International Solar Alliance.

India has set a goal to achieve 175 GW of capacity by the year 2022. This is an ambitious goal given its current renewable capacity is around 46 GW. India has also pledged to reduce its emissions intensity by 33-35% below 2005 levels by 2030.

Bad and good news: While India ranks ninth in most polluted nations, it’s second in its use of renewable energy The World Health Organisation (WHO) recently released its 2016 data for the most polluted nations in the world. While Saudi Arabia tops the list with an air pollution level of 108 PM 2.5 (a measure of fine particulate matter that it too small to be seen, but can result in hazy conditions), India falls ninth on the list at 62 PM 2.5, just after Nepal. The safe limit of PM 2.5 is 60. Delhi was recorded as the most polluted city between 2011 and 2015, and is most likely to retain that spot in 2016 primarily because of the thick blanket of smog that covered the city a day after Diwali last year. At the time, the level of PM2.5 pollutants, which are the most harmful because they can reach deep into the lungs and breach the blood-brain barrier, have reached at least 999 in parts of the city this week, more than 16 times the safe limit.

India’s installed renewable energy capacity surpasses 50 GW

Elon Musk's Tesla Motors all set to make its India debut In April 2016, Musk had said that Tesla Motors is aiming to enter this Indian market in 2017. He had said that the company is working on the exact date of its launch in India.

He, however, had promised that the company would be present in India before the production of its latest Model 3 begins.

Clean energy: Govt is moving away from its plan by diluting the National Clean Energy Fund

The Indian government has made no secret of its ambition to become a world leader in renewable energy. Its bold target of 175 GW of installed renewable capacity by 2022 was initially seen in some quarters of the industry as naively optimistic, but recent installation successes have cast away many of those doubts.

Data gathered by the Ministry of New and Renewable Energy (MNRE) and analyzed by Mercom Capital Group show that the country had 50,017 MW of renewable capacity installed nationwide as of December 31, 2016.

Since 2010, Indian government has shown tremendous commitment towards sup-

State Rooftop solar revolution sees sunny days in Karnataka

Power Minister Piyush Goyal informed the Rajya Sabha.

Karnataka is all set to exploit solar energy in a big way. The state is taking giant strides in meeting its energy needs through solar power. Rooftop solar development has caught on with government and corporate sectors alike.

Solar power to light up smart villages in Rajasthan

Sun also powers mega infrastructure projects like BIAL and BMRCL. At Kempegowda International Airport, a 0.5 MW solar project was commissioned on six rooftops in March 2016. The project was completed in just two months. Though it contributes a small percentage of the airport’s power consumption, it reduces the carbon footprint and increases savings.

Canal-top solar power plants: One example of Narendra Modi's Gujarat Model that's working well As far as the eye can see, line after line of solar panels stretch out in the midday sun beating down on the village of Chandrasan here in this eastern Gujarat district, which squeezes in 80 more people per sq km than India’s already crowded average of 441 people per sq km.

But there is no land conflict involved with the Chandrasan installation because the solar panels unfurl over a 750 m length of irrigation canal.

The canal-top solar panels were installed in India’s sunniest state in 2012 and now offer hope for a country three times as densely populated as China, at a time when India aims for almost a nine-fold increase in solar capacity between between 2017 and 2022 to fulfil global climate-change commitments and reduce its dependence on coal-fired power plants.

India’s solar power capacity crosses 9 GW Country’s solar power generation capacity stood at over 9 GW as on December 31, 2016 with Tamil Nadu having the largest output capability followed by Rajasthan and Gujarat, Parliament was informed on Monday. Total power generation capacity was 9,012 MW as on December 31, 2016. Tamil Nadu led the chart followed by Rajasthan and Gujarat,

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Close on the heels of smart cities, the state government is planning to develop smart villages. The ambitious plan envisages developing play grounds, street lights and lifting garbage in nearly 10, 000 gram panchayats headquarters in the state.

The government is planning to exploit the solar energy in a big way to light up the rural villages and accordingly solar panels would be installed at the panchayat headquarters.

It would power street lights as conventional power supply in far-flung villages is a huge task for the government.

25 states fail to meet solar capacity target this fiscal With six years left for India to achieve its goal of generating 100 GW of electricity from solar projects, 25 states have fallen short of adding capacity by some 2,000 MW so far in 2016-17.

The biggest laggards are Maharashtra, Uttar Pradesh, Haryana, Jharkhand, Odisha, J&K and West Bengal, each of them missing the mark by more than 100 MW. In terms of renewable power purchase obligations during 2015-16, only Andaman & Nicobar Islands, Meghalaya, Karnataka, Nagaland, Himachal Pradesh and Andhra Pradesh exceeded their targets, according to the government.

Maharashtra to take joint venture route for solar push Maharashtra State Power Generation Company Limited (MahaGenco) is looking at public-private partnership (PPP) and joint venture routes to undertake works for adding 2,500 megawatt (mw) grid-connected solar energy capacity in three years. The state power generation utility already has 180 mw of installed capacity in grid-connected solar power. The new and renewable energy policy approved by the state government aims at creating 14,400 mw of fresh grid-connected installed capacity in the sector by 2020.

This includes 7,500 mw from solar energy, of which the MahaGenco will undertake works on 2,500 mw. The Maharashtra Energy Development Agency (Meda) will contribute the rest.

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NEWS

Global Funding Deal Secured for Jordan’s Biggest Solar Plant The International Finance Corporation (IFC) is to oversee the funding of what will be the largest solar plant in Jordan. The World Bank company has been appointed by UAE renewables firm Masdar, whose subsidiary Baynouna Solar Energy Company is developing the 200-MW project. The deal was signed at Abu Dhabi Sustainability Week last week and follows a power purchase agreement sealed in October between Masdar and Jordan’s state electricity provider National Electric Power Company. Expected to break ground later this year, the plant will be built 10 kilometres outside the Jordan capital of Amman.

On last Boxing Day, China’s National Development and Reform Commission (NDRC) prepared the best Christmas gift to the country’s struggling solar sector. Policy makers surprised the industry by a lower-than-expected reduction in feed-in tariff for wind and solar power.

Beijing decided to keep the prevailing subsidy of RMB42 cents (US$0.06) per kWh for non-utility-scale generation. The decision echoed the ongoing work and policies of the State Council and the Energy Bureau to promote generation at the point of consumption.

This, together with the electricity reform, sets the stage for the proliferation of distributed energy resources (DER) in the world’s largest solar and wind power producing country.

Power Sector Must Double Renewables Investment to Hit COP21 Targets, Says IEA Chief

Listen Up: Rooftop Solar Potential in the US At the center of our solar system, approximately 92.96 million miles away, is a nuclear power plant capable of powering the entire globe. We know it by its most common name: our sun. The sun’s diffuse energy can be used to heat water in thermal solar panels, or can be converted to electricity with photovoltaic (PV) panels. Since our modern society is moving towards using electricity for heating and cooling, transportation, communications, appliances and even entertainment, PV panels are the most expedient way to convert this solar energy to usable energy.

The executive director of the International Energy Agency (IEA) on Monday said that the global power sector needs to double its investment in renewables if it is to meet the Paris climate goals.

Speaking at Abu Dhabi Sustainability Week, Fatih Birol said that last year the entire budget of the global power sector was $1.8 trillion and added, “I’m afraid only 16 percent of that went on renewables and energy efficiency.”

Trump Inauguration Puts Climate Campaigning at the Starting Gate This is the day we’ve been waiting for. Though not in the way we usually mean it.

With Donald Trump now sworn in as the 45th president of the United States, it is the day most anyone with an interest in climate change and energy has been anticipating, preparing for, and significantly dreading, ever since we awoke November 9 to an unfathomable election result. For some of us, it will be a moment we’ve been training for, for most of our lives. We didn’t ask for this. Most of us (maybe all of us) would have quite happily never seen this day. But here we are at the starting gate. It’s going to be a long and difficult race. But never forget this—the odds are still in our favor.

Chinese Policy Makers Building The Best Investment Climate for Distributed Energy Resources

“The rest goes mainly on oil and gas and other energy sources. In order to reach the targets that we agreed in Paris we need renewables,” he said.

IRENA Chief on US Renewables and Trump — ‘Wait-and-See’ The head of the International Renewable Energy Agency (IRENA) is taking a wait-and-see approach on Donald Trump’s actions on climate change, but has stressed that the clean energy sector in the U.S. is a business case too powerful to ignore.

Adnan Z. Amin said last week that “from a business perspective, renewable energy is a good investment”.

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INDUSTRY INSIGHT

Taking Solar Asset Management Seriously

As the global installed base for solar is expected to surpass 200 GW this year, there is already quite a significant base of solar assets to manage on a day today basis. Until about a year ago the concept of actively managing solar assets has always been a bit of an afterthought. Investors and banks had been sold the thesis that solar is a very low risk asset class with predictable flows. But this does not mean that solar does not require any asset management.

Regardless if the sun shines or does not shine, the banks want to receive their debt service in time. And the PPA off taker wants their guaranteed solar energy delivery as scheduled. All the investor cares about at the end of the day is receiving the returns on investment they expect. And someone has to ensure that this happens.

Enter the solar asset manager. What does the asset manager do? In the industry there is still a wide spread conception that Asset Management is the same as operations and maintenance (O&M). But there are actually four distinct roles in asset management.

One of the roles includes taking care of the ‘wellbeing’ of the physical assets. Activities include regular inspections, maintenance, calibrations and cleaning, but a can also include maintenance of the site on which the asset is located, for example vegetation abatement, snow removal or erosion control. A second role takes care of the active monitoring of the asset, taking care of any corrective maintenance and looking for performance improvements. Together these 2 roles are defined as O&M or technical asset management.

A third role manages the project company that owns the asset. This includes taking care that all regulatory and contractual obligations are met, ensuring that vendors and subcontractors are doing what they are supposed to do and making operating that affect the profitability and cash flow of the project company that own the asset.

This role translates the kilowatt hour into dollars.

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Initially the industry referred to this role as ‘owner’s representative’. Now it is more generally referred to as commercial asset manager or just asset manager. A fourth role manages the regulatory, financial and administrative dealings with end investors.

This role includes conducting board meetings, sending statements to investors and making dividend distributions.

cial and administrative resources.

Until recently the activities many companies combined these four roles in the same organisation. But vertical segmentation along these roles is starting, essentially evolving down the same road as many other more mature industries have gone.

There are now a number of independent O&M and asset management firms in the market that each offer specialised services.

Particularly the role of the asset manager is going through significant transition.

For the first time ever, there are a number of conferences dedicated to the solar asset management this year, reflecting the increasing interest in and importance of this activity. But other than just the growth in the underlying market, why is solar asset management becoming so important?

In general, these are professional investors who expect the same level of professionalism from their asset managers as they are used to with the other asset classes they invest in. For asset managers this means increased diligence, focus to compliance, more in-depth reporting, and increased focus on generating cash.

One of the drivers behind growth in importance is that the market is changing rapidly from a regulatory driven industry to a market driven environment. The days of sitting back on the couch waiting for feedin-tariff payments to arrive are over. Many of the solar projects today involve selling energy to a third party and monetising one or more forms of environmental attributes.

Perhaps the energy is sold at a floating rate and the asset manager needs to swap it to fixed rate to be able to qualify for project finance.

Or part or all of the energy is sold on an energy exchange and the asset manager may use storage to make smart trades. The same storage may also be used to create an additional revenue stream by selling services to the grid, such as capacity or frequency regulation. As multiple revenue streams from solar energy are stacking up, it creates the need for additional commer-

Another factor driving the importance of the role of the asset manager is the change in type of investor in solar assets. Early investors in solar were often individuals, family offices and private equity funds. As the asset class is getting more mature, it is attracting new categories of investors.

Probably the most demanding investor out there today is the so-called YieldCo, who is taking asset management requirements to a new level. The YieldCo’s key metric is ‘CAFD’ or cash available for distribution.

The more CAFD the solar asset produces, the more successful the YieldCo will be and the easier it will for the YieldCo to be able to fund future acquisitions of solar assets.

This is why YieldCos will measure the success of the asset manager directly in form of this metric.

The rise of community solar also is an interesting space to observe, as the community solar company most certainly will outsource asset management to a third party to deal with the different needs for the different types of shareholders.

Lastly the emergence of crowdfunding platforms creates entirely new challenges: some of the newer crowdfunding platforms offer investors the ability to invest in specific solar panels. This investor model is expected to tap a whole different type of funding. But it will also generate a significant additional administrative burden on the organisation that administers the crowdfunding platform as asset managers will need to be able to track cash generation on individual panel level.

Cost factors are another important reason why asset management is getting into the spotlight. Distributed generation assets cannot be managed in the same manner as large power plants. The asset management workload is directly related to the number of sites, the type of solar assets, their geographical dispersion, the complexity of the project documents and the financing structure – and not to the MWh that the plant produces.

This is why distributed generation portfolios are often bundled in portfolios to make the numbers work. Industry is trying to create standards for project documentation, which should hopefully create efficiency gains. But by far the most effective way to manage costs is to create efficiency around asset management workflows, such as performance analytics, invoicing, accounting and reporting. Successful asset managers will be very organised and will need to automate these asset management workflows as much as possible to keep costs down.

"Pro-active and efficient asset management will certainly help generating the returns that investors are expecting, which will stimulate further investment in the solar industry...."

If the sun shines or does not shine is not something asset managers can control (yet). But pro-active and efficient asset management will certainly help generating the returns that investors are expecting, which will stimulate further investment in the solar industry.

Credits: PES Solar

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IN CONVERSATION

"Clients increasingly want to engage us right from bidding stage itself and be their one stop financial solution provider through out project cycle. " institutions playing an increasingly important role.

How do you see banks funding the renewable projects?

Mr. Sandeep Upadhyay, Managing Director & CEO, Investment Banking Centrum Infrastructure Advisory Limited

Banks traditionally have been one of the biggest source of funding the infrastructure sector specifically in the renewables sector. However going forward I think given where the bank stands with their alarming NPA position we need to seriously evaluate alternate means of bank financing which could be in the form of adding more financial institutions like IREDA or it could come from new products like the infrastruc-

ture debt funds (IDF) or the infrastructure Investment trust (InvIT) What have been the latest trends and demands for your services in India?

Where do you see the next demand coming from?

The requirement of advisory services has been gradually building up. I think now what we are looking at is graduating from advising on traditional project finance, equity raising assignments to the next level where the clients want us to get engaged right at the time of biding itself and be their one stop financial solution provider

throughout the life cycle of the project.

Anything else you like to add for our readers.

I think renewable energy continues to be one of the few sectors within infrastructure today which has a huge appetite in terms ofattractinggrowth capital. I am hopeful that a combination of efficient financing structure, conducive policies& framework and rational bidding based on prudent viability assessment are some of the initiatives basis which I guess we could get close to the aspirational capacity addition targets set by the Government.

So let’s begin with the glimpse of your company’s presence and offerings in India.

Centrum is a diversified player in financial services primarily into Investment Banking, Wealth Management and Forex business.

Within investment banking we have carved out the infrastructure practice as a dedicated team called Centrum Infrastructure Advisory Services Limited (CIAL) which is into deal making and advisory services.

CIAL advises clients across investment banking and corporate finance products including joint ventures, pre bid advisory, mergers and acquisition primarily relating to the infrastructure sector in which renewables sector stands out as a part of our industry coverage.

What have been some of the recent developments at your organisation?

We are on course to build sector focused capabilities working agnostically across all the investment banking products. I comprehend financing as a huge challenge and hence an opportunity for an advisory firm like us. From the point of view of action, I see momentum really picking up in terms of refinancing projects, M&A in stressed assets and equity raising for viable projects.

I think renewables, the sector on which we are having conference today iswitnessing increasing appetite from the growth capital investors. Accordingly, we are trying to align our team capabilities with respect to some of these products.

What are your views on the financing related to the renewable energy sector?

Well, as I said it is both a challenge and an opportunity. During the conference today we have already discussed the hugeopportunity which needs to be explored. In sectors like solar itself which is one of the priority areas for the current government, we are aspiring to add approximately 90 GW in next 5 years or so which is a huge target. Financing will continue to remain a challenge because as of now we have limited corpus of funds which are available. However going forward I see the long term investors including multilateral funding agencies and specialized financial

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IN CONVERSATION

"Our products are future oriented and more importantly they are customer oriented" What are the different products and services you offer in the Indian market?

Fronius is into 3 different businesses: welding business, solar and battery chargers. So we offer products and services for all the three businesses. In solar, we not only offer inverters but also offer PV genset solution like synchronising the solar energy along with diesel energy and also with the grid.

Mr. V.V. Kamath, Managing Director, Fronius India Private Limited Lets begin with a glimpse of your company’s presence in India.

We are a 70 year old company in Austria.

We are in India since the past 10 years but on our own as Fronius India, we are here since the last 3 years. We started in the year 2013 prior to which we were with Larsen & Toubro and we decided to separate amicably.

Being a leading manufacturer in the global PV inverter industry, what makes your product offerings different from others?

Our products are future oriented and more importantly they are customer oriented.

These products are made in Austria and hence the quality is of top class standard.

Our products are also easy to handle, easy to install and very easy to diagnose the fault.

The best part is our team who are very well trained in solar products. We are not a

price player, we are a value player. So that is what definitely makes us different from the others.

What have been the latest technology trends in solar inverter market globally and in India?

I would say it had a lot of ups and downs in the global market because of various factors. But I think it is becoming a very competitive market and everybody is aware of renewable energy. We ourselves have a program called ‘24 HOURS OF SUN’. It is our concept that we want the whole energy generated in this world to be from renewable resources and not from the fossil fuels.

Solar definitely has a good future. All the technological trends which are happening are happening for the good.

Where do you see the next demand growth coming from?

Definitely it will be from India. All thanks to our Prime Minister. I think we will have

"The best part is our team who are very well trained in solar products. We are not a price player, we are a value player...." enough business by 2025. No doubt about that.

Any message you wish to give to the solar industry?

Solar industry must learn from the mistakes which had taken place in the developed countries. They have undergone all these Chinese inventions after which they realise that what they are buying is not value for money. But by that time, many years would have been lost. So people need to be very careful while choosing and investing as these products need to run for 25 years. So investing a little more for a good quality product will be beneficial for the long run.

QUICK UPDATES

JinkoSolar Wins the India Solar Module Company of the Year JinkoSolar Holding Co., Ltd. ("JinkoSolar" or the "Company"), a globalleader in the photovoltaic (PV) industry, today announced that it has been awarded the Solar Module Company of the Year – International Manufacturer by Solar Quarter, in recognition forits outstanding contribution to the development of the Indian solar power sector and its product’s solid performance among local installations.

As the world’s leadingsolar module manufacturer and clean energy producer, JinkoSolar delivers a comprehensive portfolio of products, solutions and services for complex challenges in different regions.

“We are honored to receive the solar module company of the year award by Solar Quarter. It confirms ourhigh-efficiency products arewidely recognized by the Indian solar community, meeting the demands of the challenging applications in that region,”commented Donald Leo, General Manager at JinkoSolar, “Asthe world’s largest solar module manufacturer, we are proud to support India as they reachtheir ambitious goal for solar power, while providing the highest ROI for investors.”

NEXTracker Partners with CleanMax Solar to Deliver Solar Power in Tamil Nadu, India 30 MW grid-connected solar project to supply large IT consumer in Chennai NEXTracker™, a Flex company, announced today it has partnered with CleanMax Solar, India’s largest solar developer for corporate consumers, to supply 30 MW of its advanced NX Horizon singleaxis trackers to a project in Tamil Nadu. The grid-connected project will deliver energy to a major IT consumer in Chennai, under a long-term contract with CleanMax Solar. Set up under the Group CaptiveScheme, 100% of the electricity generated will be consumed in Tamil Nadu. The system isexpected to be operational by the end of Q1 2017.

“We are proud to be partnering with India’s leader in the corporate solar market, CleanMaxSolar,” said NEXTracker CEO, Dan Shugar.

“In the five years since its inception, CleanMaxSolar has assembled an impressive portfolio of global industrial corporations to which it is providing clean energy generation. Our advanced solar tracker technology and experience in the India market will complement CleanMax Solar’s efforts to accelerate India’s private sector adoption of renewable power generation.”

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INDUSTRY INSIGHT

Elements of a Solar Asset Management Agreement

Solar energy facility Operations and Maintenance (O&M) implies the solar site is monitored, cared for and inspected regularly. This is essentially maintaining the existing system. Broken things are fixed, hopefully before they break.

as an annual number accompanied by an annual escalator to adjust for inflation.

Invoicing may occur quarterly to cover costs of daily monitoring and response to performance issues that arise.

4. Spare Parts

Asset Management is a term often used synonymously with O&M. However we believe there are some distinct differences.

Asset Management entails managing the site security, meeting the utility company forecasting and safety requirements, guaranteeing the asset’s energy production and strengthening the probability for achieving the expected financial return.

Traditional O&M is more focused on maintaining the system (machinery) that is in place where Asset Management is more focused on meeting energy production and financial goals.

The primary elements of a commercial or utility solar Asset Management Agreement are the: 1. Term The term of the agreement is simple yet critical. The time period for which the solar energy facility Asset Manager is guaranteeing their engagement is the foundation upon which they are willing to stand behind their commitments. Our typical Asset Management Agreement is set at a 5 year term and is renewable at the end of the term.

2. Scope of Services The scope of services includes and excludes certain items. It will include daily remote operational monitoring and verification of energy production, as well as periodic site inspections. The site inspections will occur at agreed intervals and includes checking the overall system performance, electrical and mechanical visual inspection, repairing minor broken items, cleaning out enclosures, checking fences, inspecting inverter components, re-torquing electrical connections, verifying civil site conditions are stable. Services may also include cleaning solar modules, vegetation management, meter calibration, thermal imaging of wire terminations and critical equipment, and IV curve tracing.

3. Price

Any serious power plant owner will require an immediately available source of spare parts to be stored at a location near the commercial or utility scale solar facility. The spare parts, at a minimum, may include extra solar modules, fixed rack or tracker system parts such as motor & controls, module mounting parts, wire, irradiance sensors, fuses and breakers and other specialty electrical components. For utilityscale plants, a spare step-up transformer may be desired to minimize the effect of a transformer fault. The spare transformer can prevent the facility from sitting idle for weeks or months in the event of a failure.

8. Response Time Unexpected issues that arise need to be met with reasonable response times, depending on the severity of the issue.

The O&M Agreement should clearly spell out the O&M provider’s required response time to site emergencies such as an unexpected system faults and force majeure events.

In our experience, solar array Asset Management requires a watchful eye at all times. The financial return on investment is only as predictable as the level of rigor practiced in daily system performance

monitoring and onsite maintenance activities. There are a wide variety of solar power facility Asset Management and O&M providers, all with unique perspectives and expertise focus areas, and levels of rigor.

We recommend that you check credentials and inspect their managed sites to determine if there really is a fit between your needs and their expectations.

Credits: Blue Oak Energy

5. Monthly Reports A monthly report should be generated by the Asset Manager or O&M Manager. This report should identify operational performance including uptime and availability, plus any actions taken to ensure continuous operation of the solar facility. Also the report should identify any recommended performance improvements or warranty actions taken on behalf of the system owner.

6. Performance Guarantee The solar facility is expected to produce a certain amount of energy based on the design and weather predictions for the location. A Performance Guarantee is an optional, additional companion to an O&M contract that spells out the annual energy guaranteed to be produced by that PV system. A true Asset Management Agreement will typically include a welldefined Performance Guarantee. The solar Performance Guarantee is adjusted per actual weather experienced by the PV system and “trued up” on an annual basis.

7. Performance Guarantee Damages A performance Guarantee is only as strong as the carrot or stick it holds. Typically, there is a form of payment to the site owner if the site does not perform to weather-adjusted expectations.

The price of the agreement is often stated

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INDUSTRY PERSPECTIVE What Hurdles Will The Indian Industry Face While Achieving The 7 GW Projects Planned For Completion Next 18 Months?

Mr. Srishti Ahuja Taneja, Director, Transaction Advisory Services, Ernst & Young LLP With installation of ~4.8 GW in the last 18 monthsand multiple bids u n d e r w a y, addition of 7 GW in next 18 months is only intuitive for the Indian solar sector.

This growth is aided by strong regulatory push from the government - facilitation of cheaper imported modules, implementation of UDAY scheme, investment in green corridors and transmission infrastructure, etc. The key hurdle to achieve the proposed growth will be CAPITAL! 100 GW of solar capacity needs ~USD 20 Bnof equity alone. In the shorter term, installations of 7 GW in next 18 months will entail USD 1.5 Bn and USD 9 Bn in equity

and debt funding respectively.

On the debt side, most PSU banks are shying away from the sector. While the NBFCs and some niche players have been fairly active, they will soon be limited by their balance sheet size. So, it is imperative that the PSU banks take a fresh look at the sector.

On the equity side, thedevelopers would need to look beyond internal accruals for funds. Global strategic and financial investors are already becoming increasingly invested in the India solar story.

The sector is ripe for capital recycling where some of the risk capital can be freed-up by down-selling mature assets to yield investors – we are seeing a lot of demand amongst investors for such opportunities.

Secondly, fresh equity fund raising activity

is likely to continue into domestic renewable developers – some of the recent successful raises being done by Hero Future, Azure, Renew andGreenko.

Some innovative trends are also emerging.

Global players are willing to take Greenfield development in partnership with domestic developers.We are seeing JVsand joint development frameworks being worked out both at the project level and the portfolio level. The sector is also seeing structured investments (a cross between debt and equity) at very competitive rates.

Government has taken interesting initiatives like 100% FDI in renewable and introduction of Infrastructure Investment Trusts to recycle capital. With some of the hygiene factors like back-downs and land acquisition being addressed, fundingwillbethe greatest facilitator of growth momentum

What Are The Key Challenges Project Developers Face In Managing Solar Assets Today?

Mr. Awadhesh Kumar Jha, Vice President–Solar O&M, Sustainability, and Hydro, Fortum India Pvt. Ltd.

India offers huge opportunities in sustainable and clean energy sector especially in the solar space. For the project developers the biggest challenges are related to land acquisition. Besides, grid connectivity and power storage solutions are still on the process of development and the entire infrastructure needs to be strengthened. Having said that government of India is aware of the bottlenecks and the new policies are reflective of government’s willingness towards strengthening the ecosystem to harness the true solar potential of India.

The most important challengein managing solar assets is making up falling generation due to inherent degradation of modules by keeping plant available all the time and continually improving the efficiency of the plant. As plant operator does not have any control on grid reliability, It is essential to keep plants up and running whenever grid is available. This brings in the significance of predictive and preventive maintenance and avoiding corrective maintenance. This again requires an optimal spares in store. Additionally, to keep the plant performing to its designed level panel needs to be cleaned frequently. The appropriate cleaning modalities needs to be in place to ensure efficiency of the plant.

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Non uniform regulatory practices in different states is another challenge for developers. Some states have Net metering concept, whereas others impose hefty charges on the power drawn to meet auxiliary. When governments committed to add 100 GW by 2022 and at affordable price for the ultimate consumer, it is a legitimate expectation of developers to have net metering adopted by all states so that economics of solar business remain viable.

Also a dedicated and committed workforce is of course really important. The prevalent business environment where solar price is falling which puts pressure on O&M as finding appropriately skilled manpower is always a challenge. One concern is not having solar specific labour regulations. All solar plants are treated at par with traditional manufacturing factories, and all compliances irrespective of its relevance are enforced. This puts additional burden in terms of time and cost as well which could be easily streamlined by having a separate regulation relating to Renewables in particular and power generation in particular. This could be an umbrella regulation which would take care of all aspects of this business.

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COMPANY FEATURE

Webdyn is Engaged in the Development of Leading-Edge Technologies Based on Internet Protocols and Radio Technologies Introduction For more than 15 years Webdyn designs and industrialises material and software solutions for M2M communication on the Energy, Environment, Smart Grids and Transport markets.

Webdyn is engaged in the development of leading-edge technologies based on Internet protocols and radio technologies to provide innovative and cost-effective teleservices: remote maintenance, remote management, remote control and remote monitoring.

Webdyn is a European leader of supplying multi-protocols concentrators which cover all the applications of teleservice and the monitoring, In India specifically for Solar Remote Monitoring. With competitive and flexible products, Webdyn covers the entire management of the distant equipments.

The range of specific products and services supplied by the company covers all applications including Solar requiring the integration of IP technologies in your remote management or automated systems.

Webdyn is headquartered in France and also has an office in New Delhi for Indian operations.

Strategy Vision Statement:For more than 17 years now Webdyn has been fine-tuning its expertise in the area of radio, PLC, embedded systems, and telecommunications technologies in general. More than 50% of its employees are dedicated to R&D and in a very short span of time Webdyn projects itself as the World’s top M2M concentrator / Remote Monitoring company. a.

Mission Statement: As maintaining good relations is essential for the success of a project, Webdyn places great importance on the attention given to its customers. The speed of response of the commercial and customer support services and the confidence established with the customers are of prime importance and form the subject of an annual satisfaction survey, keeping this theme in our hearts since our existence in India from Sep’15 we are successfully catering to around top 30 Solar EPC& Developers having more than 500 Solar Rooftops/sites & AIM to increase this capacity to 10 folds in a couple of years. c. Business Goals & Objectives: Webdyn is a global leader in M2M concentrators, In India as well the goals are no different & Webdyn certainly AIM to be the first choice of every executive / manager / founder for Remote Monitoring of their Solar sites & in the time to come for Smart Cities. d. Business Strategy: At present Webdyn in India is operating from New Delhi office having Business Development & customer support team and working with channel partner for Logistics / Stock / Invoicing of the products from Mumbai & having chan-

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nel partners for sales & service support in Bangalore. Webdyn is in the process of setting up more channel partners region wise.

3.

Business Concept a. Webdyn is having a list of World class Dataloggers catering to various sectors like: Environment, Renewables, Energy, Transport etc. Specifically in India our prime focus is to provide the best remote monitoring practices for Solar installation in order to achieve best O&M practices at effective & efficient price. b. Although there are several Inverter Web Boxes are available provided by Inverter manufacturers but they have their own limitations onto the number, make, brand & type of Inverter / devices to be connected for monitoring. The product WebdynSun is best suitable to overcome all these & many more relevant issues of managing heterogeneous sites onto single login & hence WebdynSun is at par with any competition in Indian market for Remote Monitoring. c. Quality Policy Of The Company: The Company Webdyn in France is ISO9001 certified & the product WebdynSun is CE certified confirming to the R&TTE directive, EMC directive & Low Voltage directive.

• • • • • • • • • • • • • •

Chemtrols Solar Waaree Energies Harsha Abakus Gensol Uneecops Aditya Birla Group Rely on Solar Customized Energy Solutions Research Centre for sustainable solutions Solfreedom Inspire PES Engineers AMP Solar Tata Solar etc…

b. Ambitious projects There are many ambitious projects that we have completed & are Aiming at, like monitoring remotely the 6KWp Microgrid project (working fine since last 7 months) for a village in Jawhar Distt. Of Maharashtra where even the mobile network coverage was the major issue, onto the higher side we have provided the monitoring of 5MWp solar site to one of our prestigious client.

d. Service Pledge: Listening & customer service are the top priorities of the company &Webdyn is focused to deliver the high quality service since the beginning of its Indian operations with the local service support available in India & the network is growing.

Team & Management a. Organisation Structure: The company is Headquartered in France with Design, development & R&D team sitting there & working continuously to create a masterpiece and timely upgrades, In India the Business Development & Customer Service support for the products are available that can provide the Training sessions, online configuration of the sites & onsite configuration & service support in case required.

b. Ownership Structure: Mr. Philippe Faugeras is the Founder & CEO of Webdyn, Mr. Hervé Bibollet is the Managing Director of Webdyn, both are based in France but keeps on visiting India every couple of month to meet prospects & customers and to take there valuable feedbacks, Indian operations are managed by Mr. Gurdeep Singh Juneja (Business Development Head – India).

Customers & Projects A few Indian customers & projects Some of the prestigious customers of Webdyn in India since last one year: • • • •

Renew Power Amplus Solar Cleanmax Solar Hero Future Energies

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IN CONVERSATION

"This year has been a year of performance and scaling up of overall installed capacity"

Mr. Manoj Kumar Upadhyay, Founder & Chairman, ACME Group Let’s start with the recent developments at your organisation in last one year.

a large scale consolidation because there are almost about 200 players with almost 5 MW capacities each. It is for the betterment for the sector if the existing plants are managed by 10 to 15 large players for better management & operational excellence.

achieved over the horizon of 12-14 months and disbursement thereafter. However, financial closing of Solar Power Projects needs to be achieved within 3-5 months to enable the project commissioned within 12-15 months as per the PPA.

excellence. But industry has learnt and reached to a level where such challenges can be minimal.

Therefore just to answer your question, you will surely find more examples likes of Tata’s at larger scale but many smaller deals will also happen.

I am sure all stakeholders, including Solar Power Developers and various Government agencies are working on this aspect.

Our target is to build more distributed solar power plants at village, city and metro level to stay near the point of demand & consumption and thus reducing the cost of transmission to lowest.

As a developer, what key challenges do you face today?

Our manufacturing facility of batteries at Rudrapur, Uttarakhand shall soon be operational.

There are some issues which need to be looked into to enable commissioning of the plant within the stipulated time lines of the PPAs. As such these timelines are very aggressive. Most of the projects need to be commissioned within 12-15 months from signing the PPA. Examples, Solar Power Plants are land intrinsic projects and require mostly rural wasteland. Whereas, data of most of the rural have not been updated in the revenue records. In view of this, land acquisition becomes a huge challenge.

Will we see more M&As in the solar sector?

I think the time has come for this sector to witness growth either through organic expansion or through inorganic acquisitions. I believe that we are going to see

Secondly, availability of the lender. Most of the lenders in this sector are Public Sector lenders who are attuned to lending large thermal power projects. Financial closure of conventional power project, wherein gestation period is around 3-4 years, can be

2016 was a year of scale up for ACME from 5 Solar Plants in the states of Gujarat, Madhya Pradesh, Odisha, Chhattisgarh and Rajasthan to 17 Solar Plants in operation with presence in 13 states. This year has been a year of performance and scaling up of overall installed capacity.

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Which states do you believe lead see maximum solar energy investments this year?

It is difficult to say but the southern states of Karnataka, Andhra Pradesh and Telangana will have larger deployment as they have signed PPA’s of more than 4 GW in last 12 months.

As the assets become older, will aggressive bidding today become a pain point for the industry a few years down the line?

While bidding developers take care of such issues and bid accordingly. Therefore, unless there is a drastic change in a policy, these things are manageable.

Having said that, older assets need more care & better operational management.

They can be a pain point if not taken care of through proper operation management

What are the milestones you wish to achieve by the end of this fiscal?

Anything else you would like to add for our readers.

In today’s scenario, electricity from solar based power plants makes much more commercial sense & hence I believe time has come to reap the fruits of investments towards the development of the solar power plants. For example, rooftop solar power plants for commercial establishments which is paying probably INR 8-8.5 per unitfor electricity from grid can save almost about INR 3 per unit for their electricity generated through solar power plant.

However, there is intermittency attached to it. Therefore, we would see energy storage solutions playing a major role in times to come. Energy Storage Solutions can also be used for voltage & frequency regulation and thus supporting stable grid.

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COMPANY FEATURE

Pioneering Solar Innovation Since 16 Years, SSAEL Diversifies Into Full-Spectrum Solar O&M Shri Shakti Alternative Energy Ltd (SSAEL), part of the Shri Shakti Group, Hyderabad, was incubated in 2000 by IFC, Washington, under a GEF program - Photovoltaic Market Transformation Initiative (PVMTI).

Since then, Innovation and Market Transformation are in the DNA of the Company. As a pioneering Consulting, Design & Implementation entity, SSAEL has executed projects for World Bank, ADB, UNIDO, kfW, IREDA and consulted to RERC for determination of tariff for Solar PV and CSP power projects. The spirit of breaking new ground with innovation led the SSAEL team to form 3 operating verticals; Solar Parks, Remote Monitoring of Off-grid Solar, and Comprehensive Solar O&M and Diagnostics.

A snapshot of the company’s business and serviced market sectors SSAEL is developing the first 500MW Solar Park under a MoU with the Rajasthan State Government. One of the largest private sector utilities in India is developing 50 MW in this Park.

The company also won a grant award in May 2016 from the PACE setter Fund, jointly funded by Government of India & US State Department for Remote Monitoring

of Solar Pumps and Off-grid Solar Plants.

This is rolling out into a high-impact initiative in the rural market-space.

Recently, SSAEL launched Solar O&M Services in partnership with Alectris, a Global Leader in Solar Asset Care Innovation. Their award winning product, ACTIS (Asset Control Telemetry Information System), the world’s first ‘Solar ERP’, has proven itself across US, Spain, Italy, Jordan/ MENA, Europe and Japan and is currently being offered by SSAEL in India. ACTIS helps squeeze maximum performance out of solar plants with real time data analysis and reporting for quick fault handling and deep diagnostics. SSAEL undertakes O&M contracts with performance guarantees and periodic diagnostic studies for preventive maintenance.

Strategy Growth in new business areas in the solar domain has been a constant pursuit at SSAEL. Standing on the shoulders of giants through mutual win-win partnerships has always allowed us to see further. The vision today is to bring process excellence in the way solar parks are built and marketed with the progressive Government of Rajasthan and private sector partners. Also, to estab-

lish new paradigms for cropping, land use and groundwater conservation by farmers through access to big data around solarbased farming.

operations across India and has conducted several projects overseas with matrix reporting teams.

And significantly, to improve performance of existing and new utility scale solar plants through holistic O&M interventions that improve long-term returns for bankers, EPCs and Developers alike.

Members of the board and advisory teams comprise senior professionals and subject matter experts who lead multiple organizations in India and overseas and gravitate to SSAEL because of its overarching spirit of enterprise in solar innovation.

Service Commitment

Customers & Projects

SSAEL delivers supra-optimal value across its business verticals as a consequence of a 2-word operating philosophy that has driven it since inception. “Under commit.

Over deliver.”

Over the last 16 years, SSAEL has added value to a diverse mix of the largest organizations. To mention a few; World Bank, UNIDO, GVEP, kfW, IREDA, UNICEF, RERC, the Governments of Arunachal Pradesh, Chhattisgarh, Rajasthan and Mizoram. In the private sector; AES Solar, Fotowatio, GMR Airports , Airports of Mauritius, Tata Power Renewable Energy , McDonald's India , Hindustan Petroleum , and Indian Oil among others.

Team & Management The company is led by a pioneering visionary; Mr DV Satya Kumar. A Chevening Scholar at London School of Economics, he has been passionate about the clean energy sector ever since he was at Iowa pursuing his M.S in Industrial & Management Engineering 3 decades ago.

Designed as a flat organization with equal opportunity and equal access, SSAEL has

Alectris, SSAEL’s partners for full-spectrum O&M services backed by an in-house developed ‘Solar ERP’ has sites at 500 locations across the world and are viewing the Indian market with both, excitement and commitment.

IN CONVERSATION

"Recently, we organised ourselves into taking IoT much closer to existing enterprise IT systems like CRM, helpdesk, ITSM" manufacturers, OEMs, gateway and sensor manufacturers.

As far as Indian market is concerned, Symphony IoT would be congruous to smart city projects that involve large scale smart lighting, transportation, energy distribution and savings, water and utilities management and large scale connected building management. We are looking to partner with SIs that specialize in IoT and also OEMs that are moving towards the ‘smart space’.

Mr. Prabhu Ramachandran, Director, WebNMS Let’s begin with a glimpse of your company’s presence and offerings in India.

WebNMS, the IoT division of Zoho Corporation is a leading provider of Internet of Things Platform and Solutions that maximizes the potential of connected business infrastructure. Symphony IoT, the flagship product of WebNMS, is engineered to streamline enterprise operations by optimizing expenses and upgrading operational efficiency through proactive energy and remote monitoring of geographically dispersed assets, both fixed and mobile.

The platform addresses three key areas of enterprise business challenges viz. energy, remote site management and asset tracking. This key player in the market encourages an enterprise-ready ecosystem through its partners that includes, engineering service providers and system integrators, software developers and resellers, facility management companies, device

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What have been some of the recent developments at your organisation?

IoT is the next big thing for Zoho as an organisation. We are in the IoT space for over 6 years. Recently, we organised ourselves into taking IoT much closer to existing enterprise IT systems like CRM, helpdesk, ITSM and other tools. We enable collection of all machine and business data, across the last-mile, that tightly integrates with existing software and tools, aiming to make IoT more realizable as part of our day-to-day activities.

How important is real monitoring and analysis of data? Could you explain your technology offerings in brief?

ROI is a solid way to determine the actual result of any new installation/ software and it pays to be proactive when it comes to large installations. Though IoT based solar/ wind monitoring involve investements on the higher end, they’ve proven to reap larger benefits on the balance sheet over the years. To corroborate the results, it is essential to deploy real-time, continu-

ous monitoring, preventive and predictive maintenance. Data over a period of time, say 5-6 years, is crucial in terms of overall growth of the energy enterprise.

The WebNMSSympony solar and wind mill management solutions deliver exactly what the renewable companies are looking for today – great technology that yield maximum returns within a considerable period of time. The cloud based solutions offer real–time data that is transparent, validated, timely and most important of all, accessable by multiple devices across geographic locations.

What are the recent technological advancements in performance and yield data management?

With advancement of technology and availability of pocket friendly sensors, IoT solutions are becoming cost-effective and easier to adopt and deploy across verticals – energy industry in particular. The solar industry with its high investment assets needs advanced monitoring solutions to sustain competition and weild favorable results. The solutions should be capable of integrating with the existing infrstructure and add benefit to the overall operations.

WebNMS, we’ve been trying to create a unified, integrated solution that offers real-time visibility, control and reactions at granular levels. This includes trends on energy generation, peak results related to weather conditions, anomalous drop in energy and analysis of under-performing unit, comparison of energy usage across a city at a given time of the day and the likes.

Typically, we’re trying to bring the mechanism of monitoring internet bandwidth into the sustainable energy space - more realtime and more mobile.

What is the future of asset and data management systems?

As sustainable energy grows to new heights, the industry will largely embrace IoT to monitor and secure multiple, remote end points. This is true especially in case of mission-critical solar/PV assets. Realtime monitoring, predictive maintenance and deeper analysis of asset performance are what will drive and fasten adoption of solar rooftop panels. For newer entrants, a tangible proof of ROI lies in being able to clearly deliver efficiency and monetary benefits, backed by historical data of solar power utilization in comparison with conventional power.

What are the advantages of having good quality solar monitoring systems in India?

Anything else you would like to add for our readers?

Often today, we lack an effective communication infrastructure in place to help manage geographically-distributed solar units and PV panels. Multiple, proprietary systems provide fragmented results that only leads to dead-end dashboards. At

IoT in renewable is something new that we are trying to bring. By itself, IoT is the next biggest disruptive technology and we’re pretty excited to bring insightful software to the energy industry, that drives both, a greener and cost-effective environment.

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PRODUCT FEATURE

Reliable Solar PV Utility Scale Solutions For Improved Generation Indian solar industry is growing at rapidpace past two years to meet 60 GW grid connected solar power projects by 2022.

Though total installed Solar PV capacity in India is about 10 GW, developers continue to search for more reliable and efficient solar technology solutions. Numerous solutions entering Indian market with promotions to match constant demand of reduced Levelized Cost of Energy (LCOE), the developer runs with the risk of choosing solutions under narrow tariff and completion timelines. Solar technology solutions are really unique to geography and require appropriate engineering, construction and monitoring for reliable operation throughout lifetime. L&T’s diverse experience has helped in engineering, constructing many MW scale SPV plants which have completed 5 years of successful plant operation.

In India, L&T Solar with a portfolio of over +600 MW has provided to its customer various unique solar technology solutions within stipulated timelines specific to location, terrain, geological conditions and other project specific requirements. Fixed tilt Solar PV power plants, broadly 90% of global installed solar PV capacity, is relatively simple in construction and proven across all climatic zones. Solar panels are installed facing true southin northern hemisphere and tilted upto optimum angle based on the latitude. In these plants, solar collection efficiency reaches maximum only during noon. Highly competitive Indian solar market is consistently demanding to increase generation, reduce Balance of System (BOS) and optimal land usage. For improving project financials, it is necessary to increase generation with incremental addition over fixed tilt’s capital and operational costs.

trackers are more economical to sites with higher direct irradiation.

L&T Seasonal Tilt Structure: Solar panel mounted on seasonal tilt structure faces south direction. Annually 2-4 times each structure is tilted to get maximum generation benefit as per project latitude. Generally seasonal tilt systems provide 3% - 5% generation increment compared to fixed tilt PV solar power plants.

L&T structural design with telescopic bracing arrangement ensures safe tilting manually. The pivot connections in the structure which ease the tilt change without removal of bolts and hence the adjustment can be done in short duration. All the PV modules in a structure are connected to the single steel tube section which allows uniform & smooth tilting of all the modules. Each predefined tilt is identified with the help of guide bolts to avoid the complication in searching of connection point during tilt change.The unique structural design

has built-in safety features which prevent structure dropping suddenly and module lifting without any stresses on it. L&T Solar after extensive field experiment developed in-house seasonal tilt system design for reliable lifetime performance to customer.

day. In a ganged tracker design, multiple rows are connected via drive shaft running along E-W direction. Tracker is actuated by central drive system. Local control system with inbuilt sun path program and operational logics serve as brain for solar tracker.

ysis of every project site is conducted using software to reduce land cutting volume requirement for tracker installation. Project site’s wind pattern is analyzed thoroughly to counter wind buffeting effects using dampers. Our design uses higher grade UV

Dual axis trackers have two drives with more controls. This is more beneficial for higher latitudes.

stabilized polymer materials for life time maintenance free performance. Also tracker closed loop control system with back tracking logic ensures precise shadow free sun tracking for entire day.L&T’s tracker design is provided with user friendly controls and requires very less maintenance intervention. Higher reliability of tracker is achieved by using industrial grade motors & controls and spares availability is not a concern to customer for life time.

The relative performance gain of different tracker technologies varies significantly with project latitude. For any developer, selecting the reliable tracker solution is

L&T Solar successfully demonstrated and tested single axis trackers at various scale across India to validate operational performance. The utility scale optimized ganged design is implemented in 10MW of projects which is nearing completion. Further to that, 200 MW+ is under execution with L&T’s HSAT. L&T’s design is validated and certified by renowned technical agency in India.

Solar Trackers:

"L&T structural design with telescopic bracing arrangement ensures safe tilting manually...."

Seasonal tilt and trackers are globally available alternative technologies for generation improvement. Seasonal tilt system has provision to manually adjust the tilt of the structure with respect to variation in Sun’s position (Solstices and Equinoxes). Sole objective of tracking is to reduce incident angle between sunlight and solar panel throughout the day for achieving maximum collection efficiency. Automated solar

Solar trackers are classified broadly as single axis and dual axis systems. Single axis trackers follow only daily movement of sun from morning to evening whereas dual axis systems follow both daily & seasonal movements for precise positioning.

The axis of rotation on these single axis trackers is either horizontal or vertical with respect to the ground. In India, single axis trackers provide 12% - 24% energy gain compared to fixed tilt PV systems depending on latitude and solar radiation quality.

In Horizontal Single Axis Tracker, a long horizontal steel shaft is supported using bearing journals mounted upon posts or frames. Panels are mounted upon the shaft which is parallel to North-South axis. Shaft will rotate along its axis to track the EastWest motion of the sun throughout the

prime importance to accomplish 2% IRR gain envisaged for a project’s lifetime.

L&T Horizontal Single Axis Tracker: L&T Solar’s experience with tracker dates back to 2012 when it executed the first landmark single axis solar project in Gujarat.

This is one of best performing plant for past 5 consecutive years as per GLDC data.

With growing demand, L&T developed reliable tracker solution in-house with unique features. L&T HSAT, Tracker pitch & tracking angle limit are configurable as per project requirements which provides additional yield benefit to customer. Undulation anal-

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"L&T Solar successfully demonstrated and tested single axis trackers at various scale across India to validate operational performance...."

Credits: Mr. M.S.Paintamilselvan, Product Manager Mr. Rahul Bhardwaj, Head - Business Development

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INDUSTRY INSIGHT

Rooftop Solar Sets A Scorching Pace However, achievement by 2022 may be only a third of the government’s target Solar power generation from rooftop installations is expected to soar over the next five years given declining costs, facilitating policy measures and incentives to consumers. However, the government’s target of generating 40% of the 100 gwcapacity planned by 2022 from rooftop solar could prove a herculean ask.

CRISIL Research foresees rooftop capacity touching only 12-13 gw by 2022, which in itself would be no mean feat given that installed capacity (grid connected and off-grid) was just ~1 gw at the end of September 2016.

Over half of this, or ~7gw, is expected to be added by Delhi, Gujarat, Maharashtra, Andhra Pradesh, Telangana, Karnataka and Tamil Nadu, given incentives such as capital subsidy, high feed-in tariffs and better project economics.

claiming accelerated depreciation benefit.

This fiscal, the cost of generating rooftop solar power is estimated to be ~Rs 5.5 per unit for projects not claiming accelerated depreciation benefit and ~Rs 4.5 per unit for those availing of tax incentives.

With further decline in module prices and increase in grid tariffs, the economicsof rooftop solar would be even more favourable going forward.

However, for residential and agricultural consumers, there is limited economic incentive to set up a rooftop project on net metering basis as their tariffs are cross-subsidised by industrial and commercial users, and therefore are lower. For such consumers, the economics would be favourable only if they are allowed to install projects more than ~2.5x their connected load (currentrestriction is 0.5-0.8x). This would enable them to meet their electricity needs and earn revenue for additional electricity sold to discoms at the average power purchase cost, or APPC, tariff.

tariffs by regulatory commissions, whichwe see happening only around fiscal 2020.

Then there are other roadblocks, including weak infrastructure of power distribution companies, poor implementation of open access and net metering (e.g,interconnectivity issues, cap on capacity,etc), and cheaper solar power available from ground-mounted projects.

Limited availability of affordable finance, poor enforcement of contractual obligations and potential grid variability also stand in the way.

CRISIL Research believes some of these challenges could be overcome through timely and effective implementation of announced policies at the state and district level. For instance, resolving interconnectivity issues by training discom staff, and utilising funds available through central government programmes including the IntegratedPower Development Scheme and the DeendayalUpadhaya Gram Jyoti

"CRISIL Research foresees rooftop capacity touching only 12-13 gw by 2022, which in itself would be no mean feat given that installed capacity (grid connected and off-grid) was just ~1 gw at the end of September 2016. ....."

Over the long term, we expect the thirdparty model – the renewable energy service companyor RESCO model, where the project developer leases the rooftop – todominate the market.This model has clear advantages such as no upfront costs, efficient design, lower equipment procurement cost, and better operational knowhow. Consequently, even in developed markets, this model dominates.

Meanwhile, technology disruptions leading to falling prices of battery storage systems – just the way prices of solar modules have slid since 2011 -- is expected to emerge as the next big driver for large-scale rooftop adoption. With continuous innovation and rising scale of production, battery costs, which reduced to $350 per kWh in 2015 from $1,000 per kWh in FY 2010, are expected to fall further to ~$100 per kWh by 2022. We expect the rooftop-based capacity additions to rise after fiscal 2019, led by declining battery prices.

A steeper-than-anticipated drop in battery storage system prices would provide a significant boost, particularly to residential and agricultural adopters of rooftop installations.

"With continuous innovation and rising scale of production, battery costs, which reduced to $350 per kWh in 2015 from $1,000 per kWh in FY 2010, are expected to fall further to ~$100 per kWh by 2022..."

Thus, while favourable economics will drive capacity addition in commercial and industrial segments, the domestic category is likely to pick up only after rationalisation of

Yojana. Also, higher degree of comfort to the investor community through dispute redressal forums, provision of guarantees, and access rights would be critical.

Credits: Mr. Rahul Prithiani, Director, CRISIL Research

Rooftop projects are attractive for industrial and commercial consumers such as malls, hospitals, government establishments and high-consumption group residential complexes. In particular, the net metering scheme – under which power generated can be consumed captively and any excess sold to the grid – augurs wellfor those paying over Rs 5.5 per unit.

Consumers can also increase their project returns or reduce generation costs by

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PRODUCT FEATURE

In Solar PV Domain, MWS Has Deep Expertise & Core Strength In “Active Steel Structures” Megawatt Solutions Pvt. Ltd. is a young & vibrant, innovative “Solar Energy” technology co. offering 100% indigenous, customized solutions, with in-house design, engineering, manufacturing and commissioning capabilities - also extending O & M services. MWS has been conferred Active MNRE Channel Partner Award at the hands of Sh. Piyush Goyal, the Hon’ble Minister of State (IC) for Power, Coal, New & Renewable Energy and Mines.

MWS operates in both categories of Solar energy, thru its following verticals :1. Solar Thermal, and 2. Solar Photovoltaic In Solar-Thermal domain, MWS uses Concentrated Paraboloid Dishes operating with dual-axis tracking. These systems have over 60% efficiency and can provide heating upto 400*C using thermic-fluid that can transfer the heat, thru a heat-exchanger, to any fluid (water or air). This technology is

also used for smart solar-hybrid solar-kitchens for mass-scale cooking.

In Solar PV domain, MWS has deep expertise & core strength in "Active Steel Structures", simplest form of which include solar PV trackers. However, these also find a great potential in defence systems, as well. The breakthrough custom-engineered: Single-Axis Tracking, with our individual-row controlling model for kW to MW range, adopting a turnkey delivery model for structures, trackers & controllers, at the most competitive prices – is a major differentiating factor MWS offers.

With in-house design, detailed engineering, manufacturing, installation & commissioning, as well as, O&M capabilities, our core expertise in offering 100% indigenous, fully reliable & highly cost-competitive, customized turnkey solutions.

Specifically, we have deployed various combinations of 2-axis and 1-axis trackers for Solar & Lunar applications with accuracies

MECO “SOLAR POWER METER Model 936” MECO offer Solar Power Meter, Model – 936 MECO Solar Power Meter is a portable meter used for measuring Solar Power or Solar Irradiance. It uses High sensitivity Silicon Photodiode to measure solar power. Solar Meter can also detect Solar Tilt Angle with Orientation.

This instrument is designed to measure solar power in the range from 400 to 1100 nanometers. It Measures the solar power and transmission up to 2000 W/m2. Solar Power Meter has Max / Min / Avg and data hold functions to indentify locations with maximum or minimum power. The good spectral range, orientation and angular detection of meter allow users to conduct the most precise quantitative measurements of Solar Power Radiation.

Features : •Solar power measurement with Orientation and Tilt angle •Easy measurement for rate of daylight penetration •Auto change for measuring range •Auto power off with disable function •Instantaneous display Ave/Min/Max values •20 points memory •Socket of tripod mounting •Magnetic mount •Backlit LCD and 4 digits triple display Applications : •Solar radiation measurements •Solar power research for location of the solar panels or solar water heater •Physics and optical laboratories •Meteorology •Agriculture •Windows performance – calculation and verification of the heating or heat reduction caused by direct sunlight.

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varying from 0.001 Dev to 0.1 Deg and design wind loads of 200km/hr in earth quake zone-5 sites.

m2 base-foot print provides ample coverage for the parking lot, while producing 5.5 KWP of photovoltaic output.

The elegant SmarTreeTM from MWS, not only produces power but also thru’ its design aesthetics & small foot-print enhances the visual appeal of surrounding architecture, e.g., institutions, building & commercial complexes, hotels, religious & heritage building compounds/lawns & golf courses, sea-beaches, etc. It’s merely 0.2

Prestigious institutions/process-plants like : NTPC, NDDB (Mother Dairy) alongwith several manufacturing industries, across the nation, also use the energy/cost savy customized solutions from Megawatt Solutions Pvt. Ltd. (www.megawattsolutions.in)

MECO “SOLAR MODULE ANALYZER (Photovoltaic I-V Curve Tester) Model 9009” MECO offer Solar Module Analyzer, Model – 9009 The MECO Solar Module Analyzer is a portable analyzer used for testing, maintenance and finding efficiency of various parameters of solar panel and cell.

Analyzer can be used to design Solar System to generate specific power. It can identify Solar Power System requirement, best angle of Solar Panel installation and Broken / Worn-Out cells.

Solar Module Analyzer 9009 can scan solar cells/ panels upto 60V and 12A maximum. The portability of this device means that it is also useful in quality assurance at various stages on the production line and can be taken from one site to another. When used in the installation of solar panels, solar panel analyzer assists in determining the proper inverter size as well as optimum power output position of panels and helps to identify defective cells or panels that have worn out over time.

The solar panel analyzer also provides the user with current and voltage (I-V) test curves, maximum solar power (Pmax) as well as current (Ishort, Imax) and voltage (Vnow, Vopen, Vmax). Solar cell/ panel efficiency (%) is also easily determined using the unit.

Solar Module Analyzer is supplied with user friendly software for Data Storing and Analysis. Users can store data (.CSV/.TAB) that can be read in MS Excel and print Waveform / Graph via printer.

For more details please visit : wwww.mecoinst.com Other features: Max. Solar Panel Power (Pmax) search by Auto-Scan : 60V, 12A, Best Resolution of 1mV-1mA, Memory Size 100 Records, Large LCD backlight, Communicate with PC via USB Cable, Manual AC Adaptor & Rechargeable Lithium Battery, I-V Curve with Cursor to Display each Data Point

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INDUSTRY INSIGHT

Opportunities & Complexities in Solar Power Forecasting Background Solar power is one of the fastest growing industries in India. The country's solar grid has a cumulative capacity of 9.01 GW as of 31 December 2016. In January 2015, the Indian government expanded its solar plans, targeting 100 Billion Dollar of investment and 100 GW of solar capacity, including 40 GW's directly from rooftop solar, by 2022.

The deployment of solar based electricity generation, especially in the form of photovoltaics (PV), has increased in recent years due to a wide range of factors such as concern about greenhouse gas emissions, government policies and lower equipment costs. There are a number of challenges to the reliable and efficient integration of solar energy. Chief among them will be the development of new tools and practices that manage the variability and uncertainty of solar power.

The Indian grid is currently the 5th largest in the world. Maintaining grid stability and power quality is a tedious task with its own legacy of issues. Variable generations from renewable energy such as wind and solar plants together are posing significant technical difficulties of grid management. Guarding the future projections of higher share of renewables, it is required to have a good forecast and appropriate balancing action.

Regulatory Provisions in Place CERC Regulation The Central Electricity Regulatory Commission published the Framework on Forecasting, Scheduling and Imbalance Handling for Variable Renewable Energy Sources (Wind and Solar) on 7th August, 2015. This framework is applicable for solar and wind generators that are regional entities, that is, their scheduling and settlement is handled by the respective Regional Load Dispatch Centre (RLDC).

This framework envisages that bulk of wind and solar capacity expected to come online over the next 7 years, in alignment with Government’s target of 100 GW solar and 60 GW wind by 2022, shall be inter-state in nature. That is, these generating stations shall sell power within as well as outside the host state, and connect directly to the CTU grid.

This will become essential as a few states are rich in solar and wind resources, whereas the Renewable Purchase Obligations (RPOs) shall ensure that the whole country takes advantage of renewable power, while marching towards the national goal of universal electrification.

Note: In the aggregated level forecast, the deviations lies within the CERC error band of +/- 15% for most of the time blocks, thus significantly reducing the overall impact on the generator’s deviation settlement charges.

The proposed regulations seek to address the grid integration aspects related to such wind and solar generators directly connected to the State grid. Given below is the tabular representation of forecasting regulations as issued by various State Electricity Regulatory Commissions (SERCs) The Impact of Aggregation in Scheduling The Law of Large Numbers: The renewable energy actually becomes more predictable as the number of renewable generators connected to the grid increases thanks to the effect of geographic diversity and the Law of Large Numbers. It is a probability theorem, which states that the aggregate result of a large number of uncertain processes becomes more predictable as the total number of processes increases. Applied to renewable energy, the Law of Large Numbers dictates that the combined output of every wind turbine and solar panel connected to the grid is far less volatile than the output of an individual generator.

Due to the aggregation effect, forecasts for geographically diverse aggregates of solar generation facilities have smaller errors than the forecasts for individual facilities in the aggregate. Local effects, which are more random and more difficult to forecast, tend to average away when the aggregated forecast is looked upon. With aggregation, the impact of forecast errors on individual plants is not as severe because the aggregate forecast of all plants drives the generation scheduling.

Technical Complexity & Opportunity Factors that affect forecast performance include forecast time-horizon, local weather conditions, geographic scope, data availability (e.g., plant size, location, components), and data quality (e.g., consistency, accuracy, resolution). Solar energy is inherently only available during daylight hours, so the grid operator must adjust the day-ahead plan to include generators that can quickly adjust their power output to compensate for the rise and fall in solar generation.

In addition to daily fluctuations caused by sunrise and sunset, the output from solar panels can also change suddenly due to clouds. Variability caused by clouds can make it more difficult for the grid operator to predict how much additional electric generation will be required during the next hour of the day, so it becomes difficult to calculate exactly what the output of each generator should be.

CERC Definition of Error % ‘Absolute Error’ - is the absolute value of the error in the actual generation of wind or solar generators with reference to the scheduled generation and the 'Available Capacity' (AvC), as calculated using the following formula for each 15 minute time block.

We have graphically represented the error% calculated at generator level (individually) and the error% calculated on basis of aggregated scheduling given below:

Note: In the aggregated level forecast, the deviations lies within the CERC error band of +/- 15% for most of the time blocks, thus significantly reducing the overall impact on the generator’s deviation settlement charges.

Conclusion: Forecasting of renewable energy is increasingly becoming a firm regulatory requirement. A total of 9 states along with the Central Electricity Regulatory Commission have come up with the regulatory mandate of having all the wind and solar power producers to forecast power generation on day ahead, week ahead and intra-day basis. The Karnataka and Gujarat Electricity Regulatory Commissions (in its Draft Regulation), have also acknowledged the importance of larger geographical aggregation and have permitted the agencies providing scheduling, to aggregate multiple wind/solar power generation to help achieve better accuracy which allows for a reduced financial burden of deviation settlement charges on the generators. The fast evolving regulatory framework on renewable energy forecasting is also an opportunity for all the wind and solar generators to get started with the forecasting exercise in advance and limit their regulatory liabilities, when the actual mechanism is implemented - which appears to be a very near term reality.

Credits - Ms. Varteka Tripathi & Mr. Vishal Pandya, REConnect Energy

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INDUSTRY INSIGHT

Why Asset Management Is Making A Big Entrance On The Solar Scene

As the number of solar photovoltaic (PV) systems in the U.S. grows, the number of PV systems outliving their warranty coverage grows as well. This is giving rise to a new industry of solar asset management (AM) companies tasked with managing commercial and industrial solar assets, as well as operations and maintenance (O&M).

In fact, the industry is new enough that it’s still trying to figure out how to differentiate between service offerings. AM and O&M are both separate specialized services.

However, their definitions blend together as both strive to please investors and increase return on investment. One industry trend is to integrate the two services and offer a comprehensive solution.

Operations and Maintenance O&M consists mostly of the technical activities required to ensure performance of solar PV systems in accordance with regulations and guidelines. This can include technical maintenance, vegetation control, security, etc.

Solar O&M services can be monitored live via data collected through a data acquisition system (DAS) fed into a cloud service.

More sophisticated systems will include performance management data, company administration data, as well as investor and bank report data coming from asset management.

Asset Management Asset management can be interpreted broadly and often includes O&M services as a subset. Asset management consists of financial, commercial, and administrative activities required for a solar PV system to operate smoothly and generate revenue.

Where O&M services are generally conducted in the field and at the location of the solar PV systems, AM services are usually carried out remotely in offices. This can

"The growth of solar PV companies can be largely attributed to the growing industry and aging equipment...."

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include billing, collections, distributions to investors, incentive management, accounting, administrative tasks, communication with local authorities and regulators, as well as insurance paperwork and processing.

An integrated asset management approach is relatively new to the solar industry.

However, considering the nature of AM and its relationship with O&M services, it only makes sense to integrate the two to offer a more holistic solution to solar PV management.

" Asset management also includes reporting of other technical and financial performance of the project to investors and other stakeholders...."

" Solar O&M services can be monitored live via data collected through a data acquisition system (DAS) fed into a cloud service....."

and forms a feedback loop to improve the structure of transactions before they close.

other stakeholders. In addition to risk management, asset management provides information necessary for investors and stakeholders to make informed decisions about maintaining, selling, or buying assets

The growth of solar PV companies can be largely attributed to the growing industry and aging equipment. However, this is still a relatively new industry, and there is plenty of evolving left to be done. As the solar industry continues to grow and mature, so will the role of asset management companies.

Credits: Conergy

- 2017

North India Solar Summit http://www.niss.org.in

Join one of the Most Prominent Solar Events in India

How It Works Similar to general project finance, the solar industry’s asset management begins when the project documents are signed and extends through the life of the product.

This includes initial construction, O&M services, and financial management.

Construction and O&M teams gather and share basic data metrics and risk information for asset managers to synthesize.

Asset managers can then process the data to determine how it will impact the overall return on investment and what the proper response should be.

For example, if a construction project is delayed because of permitting issues, asset managers will assess the impact of the delay on the project’s milestone schedule, capital contribution schedule, and loan disbursement schedule, then quantify the total lost revenue. This same feedback system is in place during the O&M phase as well. If severe weather were to impact a solar PV project, asset managers assess the insurance implications of damaged equipment. Asset managers would then be able to determine the level of impact from the weather event and relay that information to investors.

Asset management also includes reporting of other technical and financial performance of the project to investors and

3 Days Full of Business Opportunities !

4 Edition of “NORTH INDIA SOLAR SUMMIT” (NISS2017) will be held from 3rd to 5th March 2017 at IIA Bhawan Grounds, Gomti Nagar Lucknow. This event will showcase all kinds of Solar products, services & technologies including P.V. Solar and Concentrating Solar Thermal (CST)Technologies from within and outside the Country. Details of the event can be seen on its website: www.niss.org.in.

One Day National Solar Conclave will also be held on 4th March 2017 at IIA Bhawan Conference Hall concurrently. th

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Stall Charges @ Rs. 6000/sq m+ S.T (www.niss.org.in/index.php?page=exenquiry)

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Registration at : www.niss.org.in

Register at : www.niss.org.in/index.php?page=vienquiry.

For further queries please contact at 8601855543/44/41 or email at: info@niss.org.in; eag@iiaonline.in.

Organizer

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Date

3, 4, 5th March 2017

Venue

Indian Industries Association

IIA Ground, Lucknow, U.P. India

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IN CONVERSATION

"We have done about 100 megawatts across 5 or 6 states – Gujarat, Rajasthan, Madhya Pradesh, Uttarakhand, Punjab"

Mr. Amit Khurana, Managing Director, MI Solar Let’s begin with a glimpse of your company’s presence and offerings in India.

MI Solar India Ltd is a wholly owned company by Madhav Corp. Madhav Corp essentially owns about 100 megawatts projects in India. It develops a project, funds them and builds them. We are out and out a development and an EPC company. We have done about 100 megawatts across 5 or 6 states – Gujarat, Rajasthan, Madhya Pradesh, Uttarakhand, Punjab. MI Solar is a brand that we have created recently which caters to the turnkey solutions. Essentially projects execution on a captive basis.

What have been some of the recent developments at MI Solar?

We are essentially building plants on net metering basis, on CAPEX basis or RESCO model for SECI or other large scale cap-

tive users and consumers. There are some plants that we are developing ourselves under MI SOLAR.

and tested, but upgradation in technology is taking place. For inverters and modules, the 1500 volt system is a new thing also.

a large pool of capital available with them with lower revenue expectation will take such projects.

We are also trying to go into the hybrid solar market which is DG (Diesel Generator)& Hybrid solar. We are doing a pilot project of 500 Kilowattsystem in Madhya Pradesh which is essentially a 500 KVA DG; running a stone crushing plant that runs for 16-18 hrs a day. And we are trying to develop a controller and also a system hybrid so that the consumption of diesel essentially drops by about 30%, thereby reducing the dependency on diesel. This is quite largely prevalent in the markets across the UAE. We are developing one system here and then maybe roll it out for others.

Other than that, there are the cleaning mechanisms which are coming in for large scale plants which do not consume any water. It is a robotic cleaning system offered by some vendors. How useful they are for the Indian market is to be seen because the cost is quite high at the moment. But it is the future. Thirdly, the storage market.

Other than that anybody who will survive in this market will basically be into the technology game, acceptance of new types of technologies and in the rooftop industry.

Tell us a bit about the recent technology advancements in your sector?

The technology advancements are for everybody to see. Storage is the upcoming sector. Large scale solar PV plants are very common now. Although, even in the large scale solar PV plants there is a 1500 volt system that has come up which essentially reduces the balance of materials. So, one can look at that.

Secondly, for the rooftop markets there are now monitoring solutions and systems. We are operating in the small scale also in single phase invertors up to 6 KW and some other systems. Although it’s been now tried

What have been the latest trends in demand for your products and services in India? Where do you see the next demand growth coming from?

Like I mentioned CAPEX or captive units, RESCO models, distributed generation like the solar rooftops is picking up in a substantial manner.

Other than that, storage is coming in. The small storage capacity in a larger plant is already there. The tenders are already in place. SECI is bidding out quite a few projects. For smaller storage system, the distributed generation is also taking place now. These are the enhancements that will take the market towards that.

Large scale solar PV market has now become an investors’ game. Investors with

Any message you would like to give to the solar industry?

MI Solar essentially and Madhav Corp.have taken the wave of the large scale solar PV market. We are a completely privately held company. We have not sold any equity to anybody. We are not funded by private equity as of now. We are open to tie ups wherein investors who are looking for a piece of the Indian solar PV market can look at us as an execution partner because we do all the turnkey including land acquisitions ourselves. Indian PV market is fragmented and is not easy executing the project with all the local problems that come with the Indian PV market like land acquisition, transmission lines and evacuation. We have an expertise across that because solar PV market is not the only market that we operate in. We also operate in the Roads and Highways and small hydro. Our execution man power is about 1000 people. So that is the message I would like to give.

"We are leading the industry with MOSFETs, IGBTs and now the wide band Semiconductors like GaN and SiC" Indian market. We partner with key local and global players in these areas.

Infineon’s technology enables an efficient energy generation. Could you please highlight some of your finest innovations in solar industry.

Mr. Narendra Badve, Director and Country Head - Sales (Industrial Power Control), Infineon Technologies India Pvt Ltd Infineon Technologies is a world leader in semiconductor solutions. What are the different products and solutions Infineon is offering in Indian market?

Infineon Technologies is very focused on India market, with ambitious growth charter in next five years. We mainly focus on Industrial, Automotive, Chipcard and Multimarket Power range of products.

Industrial Power Control ( IPC ) BU is mainly focussed on participation with our power solutions in key verticals - including Power, Renewable Energy, Infrastructure and Energy Efficient Appliances. With big thrust from government for all of these segments , we are looking forward to working closely with Indian industry towards design and support for new product developments for

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Infineon plays a very active and frontal role in energy management. We design, develop and manufacture Power Semiconductors that enables highly efficient Renewable Energy generation (main focus on Wind & Solar Energy from few 100W to several MW), the Transmission and Distribution is also supported with power Electronics for efficiency, power quality and reliability upto GW level with advancements in Thyristors and IGBTs. On the consumption side Appliances, Lighting, Transportation, Industrial equipment are all increasingly relying on Power Electronics and Power Semiconductors for energy efficiency and helping reduce CO2 emission In case of solar systems the Solar to Electric energy conversion rate is ~ 15% and is generated at low voltage DC. Inverters are used to convert this into a usable form at different voltage and frequency.

The expectation for these inverters is to operate at very high conversion efficiency.

Infineon has enabled inverters surpassing 99% benchmark. We are leading the industry with MOSFETs, IGBTs and now the wide band Semiconductors like GaN and SiC.

Our latest generation of IGBTs (IGBT5 with .XT) and SiC MOSFETs CoolSiC™ are revolutionising the inverter space with highest power densities, efficiency and reliability.

All these attributes are equally important as not only cost but Total Cost of ownership is important for Renewable Energy propagation. We will be expanding the portfolio in the coming months to address the wider spectrum of Renewable Energy.

Technology matters the most in the growth of any sector; How does Infineon stand out in terms of technology amongst its competitors?

Infineon targets a holistic advancement.

Silicon and wide band semiconductors, advanced packaging with new materials & interconnects. Integration of functions are all targeted towards the goals of higher efficiency, power density and militarisation. Ease of use and faster adaptation is another area which we are working won with our eco-system partners and customers. Infineon, also sets itself apart in manufacturing of Silicon wafers with thin film technology as well as 8 inch wafer diameter the first in the world. With our depth in several markets like Drives, Wind, Solar, Automotive, Power supplies we are able to better design Silicon (voltage class, optimisation for switching frequency) and packages for a perfect fit to the application.

growth in the past year and some milestones you wish to achieve this year.

We have seen an above market growth in India; Solar, Wind, UPS/Inverters and Traction have been the areas that have seen an impressive growth of 15-20% growth per annum over the last couple of ears. We now see new opportunities in Power Quality, Vehicle Electrification and Inverterisation of Appliances showing promising growth rates. We would like to work with the Indian developers to be able to develop and manufacture such applications in India.

Infineon is also working selectively to introduce the latest technologies in India for faster adaptation.

Lastly, any message you would like to give to solar industry?

Solar Energy Industry in India is currently mainly focused on manufacturing of modules and panels while inverters are still imported in large volumes. Inverters are a critical part of the system. Investment into development of String as well as Central Inverters with new topologies as well as with high efficiency would help both the solar Industry as well the nation with contribution to the “Make in India” program.

Locally developed systems can be designed for local conditions and offer an opportunity for higher service levels as well as cost optimization.

We would like to know a brief on your

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IN CONVERSATION

"Engie’s mandate is to establish and grow a self-sustaining material business in India"

Mr. Satish Subbarao, Head – Engineering & Technical Support Group India, Engie Let’s start with the recent developments at your organization in last one year.

There is a broad sign on at executive level for the country strategy with the intention to establish a material business and take part in the India’s ambitious Renewable Energy strategy. Within the last year or so our subsidiary Solaire Direct (now Engie Solar) has concluded contracts to take their total capacity to almost 500MW, with 280 MW under construction today. We have a development pipeline involving hundreds of MW of solar and wind.

How to ensure quality, reliability and traceability of aggregated data?

Data used for project shall have good quality and reliability in order to provide the expected returns and mitigate the risks perceived by the Lenders.

Several sources of meteorological data are nowadays available for use by the developers covering both macro level sources such as PVGis, Meteonorm, satellite data (NASA); and local level data such as nearbyweather station.

For large projects, besides the interpolation and correction of macro and local data (PVGis + weather station data), it is necessary to carry out field measurements of irradiation (using Pyranometer and reference cell) along with temperature, wind speed/direction, atmospheric pressure + relative humidity).

"Standardization and innovation is an imperative in the prevailing highly competitive environment where solar tariffs are continuously falling....."

These field data are strongly appreciated as a ‘plus’ by the Lenders in the case of projects with non-recourse bank financing, and help to mitigate the risks as seen by these institutions and thereby optimize the con-

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ditions of the loans. Field measurements are also recommended in case of sites with high concentration of industries, soiling, aerosol changes, complex topography, high latitude or other uncertainty factors.

zles has a direct bearing on the Opex.

Similarly, innovations in module cleaning such as dry cleaning of modules in place of wet cleaning has a direct impact on the Opex.

Whenever on-site field measurements have to be conducted, it is recommended to perform at least a full year of measurement with overall availability of data being at least 90% (and >50% for each month) in order to have high reliability.

Considering the fact that the plant has to generate returns over a period of 25 years, a good O&M contractor, a good monitoring system and above all, a very good O&M process is very critical for the success of the solar power plant. Broadly speaking, the maintenance of a PV plant comprises of two activities viz. scheduled maintenance and unscheduled maintenance.

During the O&M phase, the incorporation of automatic data acquisition and monitoring technology is essential to achieve a high performance PV plant. This allows the yield of the plant to be monitored and compared with the energy yield calculation made from solar irradiation data to undertake remedial measures on a daily basis if any shortfall is observed.

"A high level of standardization can be achieved in the Scheduled maintenance activities such as module cleaning, vegetation control, inverter servicing, checking module integrity connections, checking junction/string combiner boxes, etc."

A high level of standardization can be achieved in the Scheduled maintenance activities such as module cleaning, vegetation control, inverter servicing, checking module integrity connections, checking junction/string combiner boxes, etc. since these activities occur in fixed time cycles.

Use of thermography for detection of hot spots can be adopted to further standardize the maintenance process and avoid unscheduled maintenance.

In order to minimize the downtimes due to unscheduled maintenance (such as rectifying faults in SCADA faults or rectifying tracking system faults), it is necessary to employ a competent O&M contractor with well trained staff.After the project is commissioned, it is normal for the EPC contractor to guarantee the performance ratio (PR), however periodic monitoring ofthe PR should be part of the O&M process in order to ensure optimized performance of the plant.

How can cost of O&M be further reduced by standardization & Innovation?

What are the milestones you wish to achieve by the end of this fiscal?

Standardization and innovation is an imperative in the prevailing highly competitive environment where solar tariffs are continuously falling. Every phase of the plant commencing from the engineering/ design, construction and finallydown to the O&M phase benefits by standardization and innovation. Compared to most other power generating technologies, PV plants have low maintenance and servicing requirements; for e.g. on a per MW basis, solar PV plant O&M costs are about half when compared to wind farms.

However with the increasing deployment of large utility scale PV plants, the O&M cost component as part of the life cycle cost are quite significant thereby reinforcing the need for standardization. The O&M process has to be incorporated into the design/engineering phase in order to optimize the life cycle costs. A low Capex solution could lead to higher Opex, a fact that is sometimes overlooked by the developers.

Engie’s mandate is to establish and grow a self-sustaining material business in India.

Within the Engie organization, India is part of the MESCAT (Middle East South Central Asia & Turkey) region with headquarters in Dubai. Over a period of 20 years Engie has become the No 1 player in this geography with about 24 major power and water assets totaling over 30 GW of capacity with several more under construction including a large services business.

Design features of the plant exert a major influence on the O&M process. For e.g. selection of the type of inverter technology (string inverters instead of central grid inverters) for a utility scale PV plant has an influence on the plant availability, spares philosophy and skill sets of the plant O&M personnel. Similarly the decision to install a deionization plant with fixed distribution pipe network for module cleaning instead of using tractor/truck mounted spray noz-

What are your thoughts on main streaming of renewable energy in India?

GOI has announced an ambitious target to have 100 GW of Solar Capacity and 60

"Over a period of 20 years Engie has become the No 1 player in this geography with about 24 major power and water assets totaling over 30 GW of capacity with several more under construction including a large services business......"

"Whenever on-site field measurements have to be conducted, it is recommended to perform at least a full year of measurement with overall availability of data being at least 90% (and >50% for each month) in order to have high reliability......"

GW of Wind Capacity by 2022. While a great deal of capital is required to achieve these targets, an immediate constraint that could prevent large scale adoption of wind and solar generation could come in the form of challenges being faced by the grid operators due to the “in-firm or intermittent” nature of the resources.Mandatory Scheduling & Forecasting for renewable generation can be considered as a temporary solution to minimize curtailment of evacuation during the peak wind season in the wind rich states. Studies have shown that rich solar resource also exists in many of the wind rich states. This suggests that combining both wind and solar could be a way forward in these states.

"Several sources of meteorological data are nowadays available for use by the developers covering both macro level sources such as PVGis, Meteonorm, satellite data (NASA); and local level data such as nearbyweather station......"

In general solar power scales up and peaks in the afternoon, only for a few hours, while wind Power generation typically peaks in very early mornings and late afternoons.

Integration of wind along with solar generation (hybrid generation) can mitigate thisinherent variability to some extent when compared to either stand-alone wind or solar generation. Adoption of energy storage in conjunction with hybrid generation can help further reduce the infirmness while improving the overall CUF and ensuring optimum use of land and evacuation infrastructure.

It is hoped that the establishment of the green corridor coupled with falling costs of energy storage will help inminimizing the impact of variability and main streaming of renewable power.

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INDUSTRY INSIGHT

Valuation of Solar Generation Assets The valuation of solar energy projects is a complex subject and is a source of tension between regulators, developers and debt and equity investors. This paper is intended to highlight best practices, as well as common pitfalls in valuing solar energy projects including the tangible and intangible assets comprising a fully contracted in-place system (a “solar asset”).

Solar assets may be valued for many purposes, including: >> Strategic planning >> Acquisition >> Debt and equity financing >>Investment tax credit and Section 1603 >>grant in lieu of credit >>Buyout options >>Allocation of purchase price for an acquisition Depending on the purpose of a valuation, there can also be different standards (also referred to as definitions) of value required by regulators, or requested by the users of valuations. These standards include fair market value (“FMV”), market value, fair value, investment value, book value, and value to the holder. However, the most common valuations of solar assets will utilize the FMV standard. Fair market value is required for federal income tax purposes (e.g., investment tax credit, and tax allocation of acquisition purchase price) as well as for Section 1603 grant purposes, and is frequently requested by investors.

Accordingly, this paper focuses only on valuations under FMV for new or “as-if fully complete” assets.

Many common errors are made by not adhering to the well-defined standard of FMV. Valuations should clearly state and define the standard of value. FMV is defined in accordance with Revenue Ruling 59-60 as follows: “The price at which property would change hands between a willing buyer and a willing seller when the former is not under any compulsion to buy and the latter is not under any compulsion to sell, both parties having reasonable knowledge of relevant facts.”

It is generally accepted and supported by numerous cases that the term “fair market value” contemplates a hypothetical willing buyer and a hypothetical willing seller.

FMV does not consider the unique motivations of a particular buyer or seller, nor does it consider unique synergistic value that a particular buyer may perceive. FMV also considers all risks inherent in ownership including factors related to control and marketability.

It is important to note that FMV contemplates an arm's length transaction whether or not there is an actual or contemplated transaction. Accordingly, the attributes of the current owner/holder (e.g., actual costs incurred and tax attributes) are generally not relevant unless they can be transferred to a hypothetical buyer. This concept is particularly important for solar assets that generate substantial value from tax attributes such as accelerated depreciation and tax credits. For example, a project owner entity’s investment tax credits would be

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based on actual eligible direct and indirect costs, overhead and may include a developer fee paid to a related party, whereas FMV is determined from the buyer’s perspective based on the expected price of the system and an allocation of that price to eligible components.

opportunity costs. Entrepreneurial profit is difficult to estimate and based on market factors. Entrepreneurial profit should not be based on actual development agreements in place, which are often between related parties and may not be viewed as representative of a market transaction.

There are many accepted methods for valuing assets that do not have a readily available or quoted market price such as solar assets. These valuation methods can generally be aggregated into the following three categories:

The cost approach provides relevant information in estimating FMV under the premise that a market participant would pay no more for an asset than their cost to develop an asset of equivalent utility. The cost approach, however, has significant weaknesses because it does not easily provide for consideration of an actual power purchase agreement (“PPA”), a contract for solar renewable energy certificates (“SREC”) sale (and they may be favorable or unfavorable to the value of the solar asset), or substantial differences among state and local incentives in different jurisdictions.

>>Asset/Cost Based >>Income Based >>Market Based In the valuation of solar assets, generally all three approaches should be developed because each provides relevant information to estimating FMV (i.e., the price that would be negotiated between a hypothetical buyer and hypothetical seller). Each approach has its strengths and weaknesses and will be afforded different weight based on the facts and circumstances. Each approach, its strengths and weaknesses, and typical pitfalls are discussed below.

Cost Approach The cost approach is applied using either the reproduction cost method (costs to replicate an identical asset) or the replacement cost method (costs to develop an asset of similar utility). The cost approach is most applicable in estimating the value of a new or hypothetical "as if complete" solar asset. This method becomes much less reliable for in-service assets because of the difficulty in estimating physical, functional, technological and economic obsolesce/depreciation.

The cost approach is developed by accumulating the market based direct and indirect costs to develop an asset of equivalent utility that would be incurred by a market participant, adding opportunity cost for the cost of capital during the development period, and adding an entrepreneurial profit to compensate for the risk in undertaking the development.

The cost approach has received a tremendous amount of attention in the valuation of solar assets, in part because certain grant applications required a cost certification from an independent certified public accountant (“Cost Certification”). However, from a valuation perspective, the cost approach is generally no more important than income or market approach, and is often the least reliable method in reaching a conclusion of fair market value. The factors causing the limitations of the cost approach mirror its lack of utility in an arm’s length negotiation between a willing buyer and willing seller, which is the required standard inherent in FMV analysis.

It is critical to note that the cost method is not a Cost Certification, and actual costs are not utilized because costs must be based on what a hypothetical market participant would incur to replace the asset, not necessarily the costs that the developer incurred in developing the asset. The market participant concept is also applied in estimating

The cost approach often provides the upper bound for the FMV of the solar asset.

However, in circumstances where the cost approach provides a higher indication of value than income and market approaches, say because of a below-market PPA, the cost approach should be given little or no weight in reaching a conclusion of FMV to best reflect the expected action of the hypothetical buyer. In situations where the cost approach provides a lower indication of value than the income or market approach, this may justify increasing the entrepreneurial profit (and cost approach value) or relying more heavily on income or market approaches because the seller would demand this additional value.

Accordingly, in estimating FMV and similar to the process when parties negotiate a price, the cost approach is typically no more important than the income or market approach, and is often the least important method in reaching a conclusion. As is evident in many real estate markets that have seen market disruption, replacement cost can be substantially higher than fair market value.

The most common pitfalls using the cost approach include: Utilizing actual costs and not considering current market costs particularly when prices have dropped and the project is delayed.

Utilizing a related party developer fee as entrepreneurial profit when the soalr asset’s economics do not justify a large entrepreneurial profit.

Placing too much reliance on the cost approach when it is a higher indication of value than the income and market approach (i.e., the economics do not support replacement cost).

Placing too much reliance on the cost approach when it is a lower indication of value than the income and market approach (i.e. the economics support a higher value than represented by replacement costs and a reasonable entrepreneurial profit).

Income Approach Valuation methods based on the income approach use the expected economic earnings capacity of the solar asset in question

to estimate value. This approach is generally used by market participants in pricing solar assets, and is usually the most relevant method to estimate FMV because it considers the specific contracts and incentives applicable to the solar asset. There is also a substantial history of case law and tax authority that indicates that the income approach is most appropriate for determining the fair market value of property that generates income, particularly a consistent income stream over a long period.

For solar assets, the income approach is generally developed using the discounted cash flow (“DCF”) method. The DCF method is based on the fundamental financial premise that the value of any investment is the present value of expected future economic benefits. The DCF method considers all of the relevant factors an investor would consider in determining value (i.e., economic benefits, risk, and the liquidation time horizon). In applying the DCF method, the economic benefit stream over the projection period is converted to present value at a discount rate which meets the return requirements of debt and equity investors (i.e., the weighted average cost of capital). A projection of economic benefits (after tax cash flows including tax benefits) covering the expected life of the system is utilized because the timing of significant benefits such as tax credits and depreciation and state and local incentives varies from year to year.

One of the inherent factors and potential weaknesses of the DCF method is the reliance on a projection covering the estimated useful life of the system. However, many solar assets will have a PPA with extensions covering a substantial portion of the estimated life of the system and statutory provisions or contracts covering SRECs or incentives. Furthermore, the timing and amount of tax credits and depreciation benefits, which represent a significant portion of the economic value, can be estimated once the price/FMV is determined.

Accordingly, the uncertainty for solar assets relates principally to merchant sales or uncontracted SREC revenue.

One of the more difficult aspects for some appraisers in applying the DCF method is determining the appropriate unleveraged discount rate or weighted average cost of capital (“WACC”). The WACC should reflect the required market rate of return on equity and the required market rate of return on debt with each weighted based on their respective portion of the long-term capital structure. The market return on equity should be based on current requirements for equity investors and is usually estimated using techniques like the capital asset pricing model used by valuation professionals. The cost of debt should reflect the market interest rate and fees on long-term solar asset debt financing.

Another difficult input to estimate is the long-term equity and debt weighting.

Much like real estate and other long-lived tangible assets, solar assets are generally debt financed with amortizing debt with an amortization period and term that is significantly less than the life of the asset utilized in the DCF projection. Accordingly, the debt weight cannot be computed based on

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INDUSTRY INSIGHT the initial loan to value or the WACC will be understated resulting in an overstatement of value. Additionally, the unlevered return or WACC should be referenced to recent studies on unleveraged rates of returns or direct observations from actual transactions in solar assets.

A further challenge in using the DCF method is projecting tax attributes such as depreciation and income tax rates. Many projects are eligible for bonus depreciation. However, if bonus depreciation creates projected losses, care must be taken to consider whether a typical market participant would put value on these benefits at marginal tax rates, and whether bonus depreciation would be considered by a typical market participant in pricing the subject asset.

It is also important to note that projections and the WACC should be determined from the perspective of a market participant, not the current holder of the asset. This is extremely important in estimating the correct amount of tax credits and depreciation that a buyer would obtain upon purchasing at FMV, allocating costs to eligible vs. ineligible items, and segregating components into depreciable lives. Additionally, the financing rates and debt and equity weighting for the current holder/owner are much less important than rates and weighting for a typical market participant.

Common pitfalls in using the income approach include: Utilizing the initial loan to value as the long-term debt weighting and understating the WACC. Failure to include a risk premium in the WACC for merchant sales or un-contracted SRECs and understating the WACC.

Market Approach The market approach is typically developed in valuing solar assets when a sufficient number of adequately comparable assets have recently transferred ownership, and valuation metrics for the transactions can be obtained. Given the volume of solar transactions in most jurisdictions and access to reliable data, the market approach is utilized for most solar asset valuations using the comparative transaction method.

Using the comparative transaction method, the reported price per capacity unit (e.g. megawatt) for recent comparable systems is analyzed and a selected cost per capacity unit is then applied to provide an indication of the estimated fair market value for the solar asset.

The first challenge in applying the market approach is finding a sufficient number of recent comparable transactions from which valuation metrics can be obtained. Given the substantial difference for solar assets between jurisdictions for capacity factors, RECs and other incentives, comparable transactions should typically be from the same region and state, and consideration should be given to the size of the system.

If these criteria cannot be met, little or no reliance should be placed on the market approach.

Even if an adequate number of comparable transactions are identified, an inherent weakness in the market approach is obtaining specific information on the comparables to quantify adjustments that may be appropriate to properly estimate FMV. The terms of the PPA can obviously have a substantial impact on the value of the solar asset, but it is often not possible to obtain the details to accurately adjust metrics from comparable transactions.

DATA ANALYSIS AND STATISTICS

The most common pitfalls in using the market approach include: Utilizing price data from transactions that are not reasonably comparable because of location or size Utilizing transaction data is not current particularly given market forces over the last several years.

Failure to consider whether adjustments to reported transactions should be made for factors specific to the system (e.g., terms of a PPA that are above or below market).

A Note Regarding Purchase Price Allocations The allocation of the purchase price by buyers for both financial reporting and income tax reporting has also been the subject of controversy and wide disparity in practice for solar assets. The rules and approach may be different for financial reporting (using fair value as the required standard of value) than for income tax purposes (using FMV as the required standard for value). While the subject of purchase price allocation is beyond the scope of this article, it is important to note that certain concepts must be considered in estimating the FMV of the solar asset because FMV contemplates an arm’s length transaction.

For example, the amount of investment tax credit and depreciation considered in the valuation must be based on the perspective of the buyer, applying the concepts that a hypothetical buyer would apply in its purchase price allocation.

This general overview of best practices in fair market value determination and the importance of appraisals does not delve into the details of purchase price allocations, a complex and important process that will be the subject of a subsequent SEIA white paper.

Conclusion Rigorous, accurate, third-party appraisals are critical to proper evaluation of solar energy generating assets. Even after valuation approaches are applied rigorously with the best available market data, reaching a conclusion is often difficult. In reaching a conclusion, each method should be analyzed for the quality of data obtained, actual and inherent weaknesses, and the importance of the indications from each method to a hypothetical purchaser. There is no basis for relying equally on the three (or fewer) approaches unless each provides the same quality of information. If the indications of value from the three approaches result in a reasonable range of indications, it may be appropriate to weight each equally. However, a wide range of indications may warrant revisiting each method and its inputs and assumptions, and in many circumstances, the cost and market approaches may need to be given less weight in reaching a conclusion.

Credits: Solar Energy Industries Association Disclaimer The information contained in this paper is not intended to be legal, accounting or tax advice. Please consult a lawyer, accountant or tax advisor before relying on any information contained in this report.

CohnReznick and SEIA disclaim any liability associated with your reliance on any information contained herein. To ensure compliance with the requirements imposed by the IRS, we inform you that any U.S. federal tax advice that may be contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.

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