New Delhi: Solar Energy Corporation of India (SECI), the only central public sector enterprise (CPSE) dedicated to renewable energy sector and falling under the administrative control of the Ministry of New and Renewable Energy (MNRE), was set up on September 20, 2011 to facilitate the implementation of National Solar Mission (NSM) and achievement of targets set therein. Over the years, it has established itself as a critical player and played a vibrant role in scaling up India’s renewable capacities and capabilities.

Renewable energy (RE) is the cornerstone of our future, and steering SECI is RP Gupta, a veteran professional and retired senior IAS officer, now serving as its Chairman & Managing Director. His illustrious career path has rightfully positioned him in this pivotal role. In an exclusive discussion with Dr Navneet Anand, Pooja Rai, and Pragya Lal of Bureaucrats India, Gupta offers intricate insights into SECI's meticulous plans and strategies aimed at propelling India's renewable energy sphere forward. His visionary leadership stands as a beacon for sustainable progress in the sector.

Can you provide an overview of SECI's current role and activities in promoting renewable energy in India, and how it aligns with the national goals and objectives in the sector?

Over the years, SECI has played multi-pronged roles that drive the sector upwards, facilitating in larger uptake of renewable energy. We have been continuously innovating to meet the market's aspirations.

SECI is one of the primary implementing agencies of MNRE for issuing tenders for development of solar/wind/hybrid/RTC etc. projects on pan-India basis on the basis of standard bidding guidelines issued by the Government. SECI is the intermediary power procurer for projects being set up through these tenders. It procures power from successful developers under its schemes and sells to buying entities such as distribution companies (Discoms) through long term power purchase agreements (PPAs) and power supply agreements (PSAs). SECI's payment security mechanism has helped in providing bankability to the agreements, resulting in very good participation in its tenders and in lowering of the tariffs.

There is a context to this. The electricity sector faced a dual challenge: financial instability in Discoms and the inherent drawbacks of renewable energy. Concerns about Discoms' financial health and the risk of non-payment hindered investment in both renewable and conventional energy. Additionally, renewable energy's higher costs and inherent variability, fluctuations and seasonality posed significant challenges compared to conventional sources. Investors were apprehensive of investing. We addressed the payment security by acting as the intermediary and this assured the developers. We have also been able to bring down the cost – it has now become almost at par with conventional energy without financial support of the government. Our reforms helped us tide over these drawbacks and also ensure that in a very near future the costs of conventional and renewable energy will become equal. In fact, there are various indirect costs to conventional energy such as those associated with health and pollution, and these are often not factored into the actual cost. And if this was done, RE would turn out to be cheaper than CE.

SECI is also a renewable energy (RE) power generating company and has its own projects' portfolio. Besides that, we also extend support to other government agencies and public sector undertakings (PSUs) for undertaking their RE projects in Project Management Consultancy (PMC) mode. We are also the implementation agency of several flagship schemes of the Government of India - such as solar parks, PLI, green hydrogen etc.

The company's mandate is to create an ecosystem that is conducive to the transition of India's energy sector towards renewable energy and which attracts private sector investments, and we are taking several initiatives to expedite it.

As a CPSE dedicated to the renewable energy sector, how has SECI contributed to the implementation of the National Solar Mission and other schemes related to capacity addition in the country?

SECI is the primary implementing agency of MNRE for development of the renewable energy sector. SECI's involvement in development of a renewable energy ecosystem in India starts from the conceptualization of an idea that reflects the needs of the consumers, and the company's involvement in renewable energy projects exists till the end of project life. SECI's proactive actions and agility of working have given a tremendous boost to the sector and have brought about its transformation from sporadic-level into a commercially viable, technology-intensive and mainstream power generation source. This sector has been able to withstand the Covid-induced disruptions and has seen a steady flow of investments from across the world.

As the implementing arm of the MNRE, we play a crucial role in bridging gaps within the renewable energy sector. The government intervenes when there's a disparity between actual costs and the market's reluctance to adopt, particularly due to high costs. Our focus lies in implementing government policies, regulations, and providing financial support to address these challenges. In the past, government viability support was essential, but with reduced costs, we've shifted our focus to backward integration, promoting manufacturing of panels and accessories, and supporting wind turbine production. We are currently engaged in promoting green hydrogen, rooftop solar, and implementing production-linked manufacturing schemes. Our objective is to ensure that once initial financial support is provided, projects become self-sustainable and integrate into the mainstream market, as seen in the wind and solar energy sectors. Our ongoing efforts aim to scale the sector, achieve economic viability, and ultimately reduce costs through increased production.

What has been the SECI’s arrangement with states and PSUs?

Our collaboration with states primarily involves their energy departments and distribution companies. We consolidate the energy requirements of the state and conduct auctions to ensure availability at more affordable rates. Subsequently, we enter into PPAs with developers and PSAs with the respective states. These arrangements are interlinked, requiring a delicate balance between developer interests and the concerns of distribution companies, who represent the consumers. The dual objective is to provide consumers with electricity at the most economical rates while fostering state development in a manner that ensures developers receive a reasonable return on their investment. Striking this balance is crucial, as making it difficult for developers might discourage investment, but it is equally important to prevent returns from being exorbitant. Our approach is centered on safeguarding consumer interests and ensuring fair and just returns for developers, striking a delicate equilibrium that promotes sustainable investment in the sector.

SECI has been actively involved in solar project development on a turnkey basis for various PSUs and government departments. Can you elaborate on some of the key projects and their impact on India's renewable energy landscape?

SECI supports other government agencies and PSUs in their drive towards green power. The government is pushing for adopting clean and green power sources, and Govt. agencies in other sectors are keen to fulfil their targets, but often they do not have the understanding of the renewable energy sector and market. We bring our domain understanding technical capabilities to recommend custom-designed systems that match the clients' requirements. Many times, we support the government agencies with innovative project configurations, so that land/water use is optimized. We ensure that the projects' performance is sustained throughout its operational life.

With a 'AAA' rating and a Category-1 power trading license, how does SECI leverage its financial strength and trading capabilities to support the growth of renewable energy projects in the country?

Under most of the tenders issued by SECI, SECI is the power procurement intermediary between the project developers and Distribution Companies and enters into 25-year PPAs and PSAs with these entities respectively. Under this model, SECI offers payment security to developers and undertakes to collect payment from Discoms. SECI's payment security mechanism has helped in providing bankability to the agreements, resulting in very good participation in its tenders and in lowering of the tariffs.

However, SECI's market facilitation role goes much beyond its power trading activity, as we try to continually come up with unique solutions that can create a sustained market for renewable energy. In earlier years, the demand was only for plain solar and wind power. But as the sector keeps evolving and witnesses shift from plain solar/wind to more innovative models, such as Round the Clock (RTC) or Firm and Dispatchable Energy (FDRE), that are better acceptable for grid integration and managing intermittency issues, SECI's market-catalyzing role is going to become more important. 

How is SECI leveraging new technologies in the development of large-scale solar installations, solar plants, and solar parks? Can you highlight any innovative approaches or technologies that SECI is currently exploring or deploying?

Since inception, SECI has always been instrumental in ideating, market research and executing such ideas & innovations in the RE sector. Various innovative supply-models, such as RTC, Peak Power, hybrid etc. as well as standalone energy storage are being demonstrated across the country to address grid-integration and intermittency issues.  Further, now there are tenders for Firm and Dispatchable RE power supply to Discoms/buying entities as per their demand profile, and we endeavour that in future base load demand could be met primarily through RE.

SECI is actively collaborating with relevant stakeholders to explore and tap into emerging business areas also, including Green Hydrogen, Greening the Transport Sector, Market-Based Models for Supply of RE, among others.

The solar park, a government initiative, streamlines the process for renewable power developers by providing ready infrastructure – connectivity, water, land, and internal transmission systems. It operates on a plug-and-play model, encouraging large-scale plant setups establishing parks with a capacity of about 40 gigawatts.

SECI is actively collaborating with relevant stakeholders to explore and tap into emerging business areas also, including Green Hydrogen, Greening the Transport Sector, Market-Based Models for Supply of RE, among others.

What’s the status of the pledge towards tripling installed renewable energy capacity by 2030. How does SECI plan to contribute to the country's efforts in meeting its renewable energy commitments and further expanding capacity?

Tripling renewable energy is a commitment within the G20 framework, initiated during India's presidency. While India supports the goal of tripling renewable energy capacity, certain aspects, such as the phasing out of coal plants, are not agreeable to us within a specific timeframe. Our reluctance to endorse these additional elements led to our non-participation in those specific aspects of the G20 initiative. It's important to clarify that India actively champions the tripling of renewable energy and was instrumental in introducing this agenda in the G20.

From the perspective of SECI and the Ministry of New and Renewable Energy, we have already taken significant steps to triple our trajectory for renewable energy. In the current year, our annual tendering has increased from approximately 15 gigawatts to 50 gigawatts, more than threefold. This substantial expansion underscores our strong commitment to tripling India's renewable energy capacity.

The Government has decided to invite bids for 50 GW of renewable energy capacity annually for the next five years i.e., from Financial Year 2023-24 till Financial Year 2027-28. SECI is one of the implementing agencies to roll out this massive tendering programme. Going forth, we expect that SECI will continue to issue bids of over 15 GW of RE capacity annually, and thus, will continue its market-making activity in RE space.

Maintaining the growth trend and attracting further investments into the sector requires a multi-pronged approach involving boosting of investor confidence and reduction in the perceived risks of off-taker by investors. To sustain and accelerate the investment momentum into the sector, measures, such as technology demonstration, reduction in financing cost, easing the business environment etc. may be required, and SECI will look to facilitate these through various ways.

In the context of India's current energy landscape, how does SECI view the challenges and opportunities in achieving energy security for the country through the harnessing of solar energy?

Renewable energy plays a crucial role in enhancing our energy security. Historically, our energy dependence, especially for hydrocarbons, has been on Middle Eastern countries. However, renewables offer a locally available and highly promising alternative in our country. While currently, renewable energy is somewhat more expensive than fossil fuels, this cost is rapidly decreasing with advancements in renewable energy and storage systems.

Anticipating a significant shift, we expect renewable energy to increasingly replace hydrocarbons, particularly in the realm of electric vehicles and transportation systems. Notably, our transportation landscape is transitioning, with railways already achieving 100% electrification, a substantial contribution to bolstering our energy security and diminishing dependence on other nations.

This shift aligns with our goal of an Atmanirbhar Bharat (self-reliant India), and renewables play a pivotal role in realizing this vision by providing a sustainable and secure energy future.

India has been actively working towards diversifying its energy mix and increasing its reliance on renewable energy sources, particularly solar energy. India offers huge opportunities for the sector, by virtue of abundant renewable resources and growing electricity demand. Additionally, other energy-intensive sectors such as rail and road transport, and some industrial segments such as iron and steel etc. that are traditionally dependent on fossil-fuels for their energy needs, open up huge opportunities for demand creation in renewable energy. 

Of course, there are several challenges, such as grid-integration, reliability of power generation, land and power evacuation etc. that also need to be addressed, and these are being looked into and are being resolved through various means. For example, the concept of solar parks was introduced to to develop large land parcels for solar energy generation. Similarly, floating solar is being promoted where there are land availability constraints. Reliability constraints are being addressed through innovative power supply models. Solar energy is definitely one of the major RE sources in our quest for energy security.

Given the evolving nature of the renewable energy sector, how does SECI adapt to changes in policies, technologies, and market dynamics to remain a leader in the development of large-scale solar installations?

As mentioned earlier, our commitment involves tripling the installation of renewable energy plans annually, presenting us with new challenges daily. To achieve this, we need to attract four to five times the current investment in renewable energy capacity and engage with new developers. Crafting policies that inspire confidence in investment security and reasonable returns is crucial to draw interest in India's development sector. Simultaneously, we must ensure that the costs to consumers and our economy remain unaffected.

Our strategy involves attracting more participants, fostering competition, and ultimately securing more competitive rates. These day-to-day challenges in commercial transactions bring unforeseen issues that require constant attention. Working closely with stakeholders, we engage in thorough discussions to arrive at fair and just solutions to the extent possible. Compromises are made, and parties reach reasonable resolutions. However, the dynamic nature of the industry, influenced by shifts in prices and emerging disruptive technologies like MHM, necessitates ongoing adaptability. These challenges are addressed collaboratively with stakeholders, knowing that solutions today may need adjustments tomorrow.

Presently, India has taken up a massive target- 500 GW of RE by the year 2030. To achieve that, we cannot rely on a linear growth path, we have to grow exponentially. So new questions will come up, how to create a sustained demand and also ensure grid stability; how to ensure that RE is available round the clock, and many more.

SECI always endeavours to be proactive and plan in advance, for the likely scenario a few years down the line. We continually engage with all stakeholders and try to mutually arrive at solutions that can sustain the sector's growth pace. We also try to bring in the best of technologies and models from across the world, and indigenize them to make the country self-sufficient in its energy needs.

There is 100% FDI. So, are the international players showing interest?

We are one of the hottest destinations for international investments in the renewable energy sector. Annual investments in the sector are rising from 10 to 15 billion dollars to an anticipated 50 to 70 billion dollars. Major players like Avaada, ReNew Power, Greenko, JSW Energy, Adani are prominent, with more significant players entering. Reliance, for instance, has recently ventured into hydrogen and panel management, showcasing the sector's substantial potential and attracting widespread interest.

What are the key strategic priorities and future plans for SECI in advancing its mission to promote and commercialize the use of solar energy across India, reaching even the remotest corners of the country?

SECI is dedicated to the growth of the RE sector. SECI always endeavours to be aligned to the current and emerging needs of the sector. Through continuous stakeholder engagements, we try to evolve ways that can sustain the sector's growth pace.

SECI is cognizant of and working on emerging areas such as Green hydrogen, electric vehicle charging through RE, tapping into commercial and industrial consumer base for enabling their energy transition towards green sources, market models of power supply, technology demonstration etc. We are working on the remote areas of Ladakh, to develop renewable capacity where the best resources are available, as well as in the island regions, to reduce their diesel-dependency. 

Our future plans aim to install 50 gigawatts of renewable energy annually, meeting our target of 500 gigawatts by 2030 and projecting a larger goal of approximately 2,000 gigawatts by 2047 as part of the Amrit of the Panchamrit initiative envisioned by Prime Minister Narendra Modi. By 2070, we aspire to achieve Net Zero, signifying the complete elimination of conventional energy, including hydrocarbons and coal, replaced entirely by renewable energy sources.

Estimates indicate that by 2047, renewable energy will constitute nearly 90% of the required 2,000 gigawatts, as coal plants are phased out. While some coal plants are planned in the near future, the transition is expected to accelerate after 2030-35. Rising prices of renewable energy, coupled with the increasing costs of thermal power attributed to pollution concerns, will likely drive this transition. As society becomes less tolerant of pollution, the associated costs will be factored into various energy sources, making pollution-free transportation and cleaner power generation more economical. Consequently, once the true cost of pollution is considered, renewable energy is expected to emerge as a more cost-effective and rapidly adopted alternative.

Having closely worked with the honorable Prime Minister must have been an awe-inspiring experience. Can you share any memorable anecdotes from your time working with him?

The Prime Minister's remarkable energy, working over 18 hours, stems from his passion for serving the people. I draw my inspiration from him as my work doesn’t tire me. His keen interest in understanding minute details is evident in lengthy meetings lasting 6 to 7 hours. A great listener, he encourages innovative ideas for pragmatic and implementable solutions that benefit the masses.