In an interview with CNBC-TV18, Anurag Mundra, Joint MD and CFO of Ujaas Energy said that this move will create business opportunity of Rs 16000 core over the next five years for solar power companies.
In order to achieve its target of 40,000 MW generation of solar power by 2022, the Cabinet Committee on Economic Affairs (CCEA) has approved a udget of Rs 5000 crore on Wednesday.
This is expected to give a big boost to the solar power sector as it opens new avenues in the residential and social sector by increasing sale of photovoltaic cells.
In an interview with CNBC-TV18, Anurag Mundra, Joint MD and CFO of Ujaas Energy said that this move will create business opportunity of Rs 16000 crore over the next five years for solar power companies.
He further said, although this amount is allotted for 5 years it may get exhausted in the next 1-2 years.
Below is the transcript of Anurag Mundra’s interview with CNBC-TV18's Mangalam Maloo and Reema Tendulkar.
Mangalam: The government has said that they have hiked the allocations for solar energy from Rs 600 crore to Rs 5,000 crore and they will support instillation of 4,200 megawatts of rooftop system. Does the math work out in your experience and in your calculations?
A: Yes, the maths work out in the favour of solar energy. As you must be aware that the government has a very tall target to achieve 100 gigawatt of solar power plant and out of that 40 gigawatt has to come from rooftop. If we talk about rooftop they are basically two segments. One is the industrial and the consumer segment and the second is home segment and non-profit making organisation like school, colleges and hospitals. This subsidy of Rs 5,000 crore will be addressing to those institutions, home segments and non-profit making organisation.
Reema: Can you tell us what percent of the subsidy might come to a company like Ujaas Energy?
A: It is very difficult to put a number right now but if the subsidy is Rs 5,000 crore for the next five years and if we add the number then we are talking of business opportunity of more than Rs 16,000 crore in the next five years and if you look at the target audience, house segments and non-profit making organisations it requires certain products and certain processes to be tweaked into. And a company like Ujaas which has a leadership position in those segments will definitely get benefitted by these policy initiatives.
Mangalam: Which is why I asked about the math, because you said the government opens up an opportunity for Rs 16,000 crore over the next five years and even if you look at Rs 6 to 6.5 crore per megawatt this comes up to only 2,600 megawatts as against the 4,200 megawatt that the government is targeting. So, where will the rest come from?
A: The government figure says it will be good enough for 4,200 megawatts but as per the current price mechanism going on in the industry we believe it is good only for 2,500-3,000 megawatts.
I understand that this Rs 5,000 crore though it has been allocated for the next five years but it will be exhausted in next one to two years and the government will be more than happy to come up with another tranche of money to support the solar power.
I want to highlight one thing that the ambition of our country though is little high but at the same time the efforts are also tall and it is matching.