BANGALORE, INDIA: The global solar energy industry is in the early phases of what may be a 30- to 50-year expansion. By the end of 2007, the cumulative installed capacity of solar photovoltaic (PV) systems around the world had reached more than 9.2GW, up from 1.2GW at the end of 2000.

Installations of PV cells and modules around the world have been growing at an average annual rate of more than 35 percent since 1998 (Solar Generation V Report, EPIA, September 2008).

The chart here, by the German Advisory Council on Global Change, indicates the vital role that solar energy may play in our energy futures. While contributing only a fraction of the world’ energy needs today, by 2060 it may be the largest single contributor to global energy production.

The European Photovoltaic Industry Association (EPIA) estimates that by the year 2030, PV systems could be generating approximately 260 GWp of electricity around the world, enough to satisfy the electricity needs of almost 14 percent of the world’s population.

India has the opportunity to play a major role in this global energy transformation. With significant technical and production resources, India can be a major supplier of PV cells and modules to meet the growing world demand.

With the current pace of growth, India’s solar industry could emerge as the fourth largest generator of solar energy in the world after, Germany, China, and Japan. Given the significantly increasing energy consumption, solar power can play a significant role in the country’s domestic energy supply.

With over 50,000 villages in India without electricity, solar power has enormous potential to meet rural electrical needs, improving the lives of millions of Indians and meeting critical agricultural, education and industrial needs. 

Current situation in India
India is already a major contributor to the global technology market. According to ISA/ Frost & Sullivan report, the total market revenue for semiconductors in India during 2008 is estimated at $4.38 billion. The growth of the key user segments, telecommunications, IT and office automation (IT & OA) and consumer electronics, is anticipated to catapult the semiconductor TM revenues to $5.49 billion in 2009. With recent government initiatives and industry actions, India can also be expected to join the leaders in the global photovoltaic market.

In June of 2008, the Indian Prime Minister Dr. Manmohan Singh said: “We will pool all our scientific, technical and managerial talents, with financial sources, to develop solar energy as a source of abundant energy to power our economy and to transform the lives of our people. Our success in this endeavor will change the face of India."

To accomplish these goals, the India government has instituted programs on both the demand and supply side for solar industry. On the supply side, last year the India cabinet approved incentives to attract foreign investment to the semiconductor sector, including manufacturers of semiconductors, displays and solar technologies.

The government announced it will bear 20 percent of capital expenditures in the first 10 years if a unit is located within Special Economic Zones (SEZs), including major economic zone in Hyderabad called “Fab City”. The minimum investment was set at Rs. 25 billion (~$500 million) for semiconductor manufacturers and Rs. 10 billion for other micro- and nanotechnology makers. With these recent announcements, the solar industry has been the chief beneficiary of this incentive-based economic policy.