Solar Financing in India

The price of solar power systems has come down drastically in India making solar panel affordable for even the poorest Indian citizens. Note large parts of India remain dark as the Indian power grid does not reach those parts. Solar Lamps have been successful in India mainly due to their economic utility rather than their Green Characteristics. Note 100,000 Indian villages do not have electricity yet, which means that the productivity comes to a complete stop in the dark. Poor schoolchildren cannot study in the dark and people cannot work in the night either. Note Kerosene a dirty oil refined product is the main source of energy for millions of Indian citizens. Similarly parts of Bihar are seeing rapid growth in sales of solar panels without any Government Subsidy. These solar panels being sold for Rs 3,000-5,000 are being used to power a couple of light and fans.

Residential Solar market in the USA has taken off as solar developers have partnered with financial institutions to provide financing solutions for their customers. Now India is too following in those lines, with India’s 4^th largest public sector Bank of India partnering with an India solar company Solid Solar to provide financing for rooftop solar systems and solar lamps to the company’s customers through its extensive Indian network of bank branches. The other Indian banks could soon follow BOI’s model.

Solar Rooftop Leasing in India

There are hardly any rooftop solar panels on homes in India due to lack of knowledge, government support and distribution. Solar Energy incentives in most of the developed solar markets in Europe have clearly shifted their preference to distributed small rooftop solar installations on residences. This is because it reduces the need for expensive power generation infrastructure, improves reliability and puts money in the hands of the common citizens. Spain, Germany and Italy which are the 3 biggest markets in the world have done this. India however has not paid any focus to rooftop solar installations except for Delhi. Note the Delhi government had earlier come up with a plan to provide subsidies to solar panels on homes. However that plan was shelved due to fears of corruption (which is a massive problem in all spheres and generally a given with all government programs).

The Indian Government is now set to bring out a policy to promote the leasing out of rooftops for buildings of solar arrays by developers and utilities. Note till now India’s solar program has mainly focused on large ground mounted solar plants. Rooftops have been largely ignored even though most countries with large solar capacities have moved on to focus their subsidies on distributed rooftop generation from solar panels.

Bloomberg

The state-owned bank signed a memorandum of understanding with Gautam Polymers’ Solid Solar unit to finance lanterns and rooftop panels for residential and commercial consumers, the companies said in a joint e-mailed statement. Bank of India (BOI), based in Mumbai, will offer the funding through its 4,157 branches. Access to loans will make it easier for consumers to buy solar products that have high upfront costs, according to the statement.