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Solar Mango’s India Solar EPC Blueprint
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Sample Report
Why Do You Need an Expert Guide to Enter the Solar EPC Business?
Starting with the National Solar Mission in 2010, solar power, especially solar PV, has been growing at
a hectic pace in India. Unlike many other traditional sectors, a number of aspects are unique to this
sector – technology, policy & regulations, and the competitive landscape that defines the business
models.
From almost insignificant installations in 2010, the total installed capacity of solar PV has crossed 7500
MW by July 2016. That is a fairly good achievement in just six years.
All these augur well for businesses. It is hence no surprise that a number of enterprising businesses
wish to become a Solar EPC.
India Solar EPC Blueprint from Solar Mango (a division of EAI), is India’s only professional expert guide
providing advice to individuals and enterprises entering the Solar EPC business. This report is written
especially for those who are new entrants in the solar sector.
This actionable guide by Solar Mango provides critical data, insights and resources that enable
businesses to take their optimal first steps in becoming Solar EPCs. This comprehensive expert report
and guide will be invaluable for those keen on entering the solar EPC business in India.
Solar Mango’s India Solar EPC Blueprint, in addition to providing detailed inputs on the business and
revenue models, key market segments, key sales strategies and more, also includes important sections
on risks and risk mitigation for solar EPC where it clearly spells out the areas of uncertainties, and how
adverse effects of each uncertainty can be mitigated.
This sample report provides those interested in buying the report with a complete list of contents as
available in the Blueprint, and brief samples of perspectives, inputs, data points and tables. India Solar
EPC Blueprint costs Rs. 25000 only, and can be purchased through credit card, bank transfer, or cheque.
To purchase the India Solar EPC Blueprint,
Send an email to [email protected], with the subject: Purchase Solar EPC Blueprint
Or contact Ramya for further information – [email protected]
Visit the official website for more information - http://www.solarmango.com/blueprint-solar-epc-
opportunity-india/
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Contents List of Figures .......................................................................................................................................... 8
List of Tables ........................................................................................................................................... 9
Preface .................................................................................................................................................. 12
Action Plan for Becoming a Successful Solar EPC ................................................................................. 13
Before You Start .................................................................................................................................... 15
List of Upcoming Solar Events ........................................................................................................... 15
List of Training Program & Institutes ................................................................................................ 16
List of Magazines & Websites ........................................................................................................... 16
Other Partnerships ............................................................................................................................ 16
Useful Data Resources ...................................................................................................................... 17
1. Solar Power Potential in India ....................................................................................................... 18
1.1 Solar Potential in India .......................................................................................................... 19
1.1.1 Prominent Regions for Solar Power Plants ................................................................... 20
1.1.2 Performance of Operating Plants ................................................................................. 21
1.2 Solar Power Growth & Trends .............................................................................................. 23
1.2.1 JNNSM Mission ............................................................................................................. 23
1.2.2 Lever's Affecting Growth of Solar PV in India ............................................................... 24
1.2.3 Across geographies ....................................................................................................... 28
1.2.4 Across specific segments .............................................................................................. 30
1.2.5 Across business models ................................................................................................ 34
1.3 Overview of Central and State Government Solar Policies .................................................. 37
1.3.1 Introduction to Solar Policies and Regulations ............................................................. 37
1.3.2 Central Policy – National Solar Mission ........................................................................ 39
1.3.3 State Policies ................................................................................................................. 43
1.3.4 Recently concluded and upcoming allocations ............................................................. 54
1.3.5 Challenges with the REC Model .................................................................................... 57
1.3.6 Rooftop Solar Policies/ Incentives ................................................................................ 59
1.3.7 Net Metering in Major States ....................................................................................... 61
1.4 Business & Revenue Models for Solar Power Plants in India ............................................... 64
1.4.1 Business Models ............................................................................................................ 64
1.4.2 Revenue Models ........................................................................................................... 64
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2. Indian Solar Market Segmentation ............................................................................................... 71
2.1 Region ................................................................................................................................... 72
2.2 Type of end user ................................................................................................................... 75
2.3 Size of the project ................................................................................................................. 78
2.3.1 Off-grid & Rooftop ........................................................................................................ 78
2.3.2 Ground-mounted .......................................................................................................... 89
3. Solar EPCs in India ....................................................................................................................... 102
3.1 EPC with focus on:............................................................................................................... 103
3.1.1 Rooftop solar power plants......................................................................................... 103
3.1.2 Ground-mounted solar power plants ......................................................................... 104
3.1.3 Companies Diversifying into EPC Business.................................................................. 105
3.2 Turnkey EPCs ....................................................................................................................... 106
3.3 EPCs with Local/Regional Focus .......................................................................................... 107
3.4 EPCs taking up mainly sub-contract work from larger EPCs ............................................... 107
3.5 Specific functions alone ...................................................................................................... 107
3.6 Pure- play design firms........................................................................................................ 108
3.7 EPCs with an O&M focus ..................................................................................................... 108
4. Business Potential Analysis for Solar EPCs in India ..................................................................... 110
4.1 Segment-wise Potential ...................................................................................................... 111
4.2 Region-wise Potential ......................................................................................................... 112
4.2.1 High Potential States – current and future ................................................................. 112
4.2.2 High Potential Cities & Towns – Current and Future .................................................. 116
4.3 Industry-wise Potential (for rooftop & captive).................................................................. 117
4.3.1 Attractive C&I Sectors ................................................................................................. 117
4.3.2 Attractive Institutional Sectors ................................................................................... 119
4.4 Costs & Potential Returns for EPCs ..................................................................................... 120
4.4.1 Costs to run solar EPC operations ............................................................................... 120
4.4.2 Margins made by Solar EPCs in India .......................................................................... 122
4.5 Growth Opportunities for Solar EPCs ................................................................................. 123
4.5.1 EPC Opportunities ....................................................................................................... 123
4.5.2 Value Added Services that can be provided by EPCs .................................................. 123
4.5.3 Technology innovations .............................................................................................. 124
4.5.4 Innovative Concepts in Residential Rooftop ............................................................... 126
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4.6 Key Challenges for the Solar EPCs in India .......................................................................... 127
4.7 General Risks Associated with Solar Power Plants that EPCs Should Be Aware Of ............ 128
5. Insights & Recommendations ..................................................................................................... 131
5.1 Skills and Human Resources Solar EPCs Need .................................................................... 132
5.2 Insights on Marketing, Sales & Distribution........................................................................ 134
5.2.1 Shortening Long Sales Cycles ...................................................................................... 134
5.2.2 Sales & Marketing Partnerships .................................................................................. 135
5.2.3 Brand Building ............................................................................................................. 136
5.2.4 Insights on Competition .............................................................................................. 136
5.2.5 Other Recommendations for Sales Strategies ............................................................ 137
5.3 Best of Breed Practices ....................................................................................................... 137
5.4 Opportunities for Innovation .............................................................................................. 138
5.5 Identifying Profitable Niches ............................................................................................... 139
5.6 Leveraging Technology ....................................................................................................... 140
5.7 Parameters on Which Solar EPCs are Evaluated by Prospects ........................................... 141
6. Profiles & Case Studies................................................................................................................ 144
6.1 Profiles of the Prominent Solar EPCs in India ..................................................................... 145
6.2 Variations of EPCs ............................................................................................................... 156
6.3 Key Mistakes to Avoid ......................................................................................................... 157
7. Solar Power Plant Reference Details .......................................................................................... 165
7.1 Land and Infrastructure Requirements for Setting up the Solar Power Plant .................... 166
7.1.1 Land Details – Area required, and other pre-requisites for the land ......................... 166
7.1.2 Details will also be provided for what portion of land is required for what purpose 167
7.1.3 Instructions on how to evaluate your land ................................................................. 168
7.2 Estimating Generation from Your power plant .................................................................. 169
7.2.1 Step 1 .......................................................................................................................... 169
7.2.2 Step 2 .......................................................................................................................... 170
7.2.3 Step 3 .......................................................................................................................... 170
7.2.4 Expected Generation for a 2 MW Solar PV Power Plant over 25 years ...................... 170
7.3 Technical Features and Equipment for a Solar Power Plant ............................................... 171
7.3.1 Overview of Solar Power Plant Technologies ............................................................. 171
7.3.2 Panels .......................................................................................................................... 173
7.3.3 Inverters ...................................................................................................................... 175
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7.3.4 Mounting Structures ................................................................................................... 177
7.3.5 Trackers ....................................................................................................................... 178
7.3.6 DC-Side Electricals ....................................................................................................... 180
7.3.7 AC Side Electricals Such as Transformers, Switchgear, Cables… ................................. 183
7.3.8 Other Balance of Systems Monitoring Systems .......................................................... 184
7.3.9 Details of Substation Required for Evacuation ........................................................... 186
7.3.10 Details of Load Flow Study Required for Your Solar Power Plant ............................... 187
7.3.11 Civil and Architectural Requirements ......................................................................... 188
7.3.12 Component Selection – Standards and Warranties .................................................... 189
7.4 Financial Analysis of Ground-mounted Solar Power Plants ................................................ 190
7.4.1 Billable kWh ................................................................................................................ 195
7.4.2 Tariff ............................................................................................................................ 196
7.4.3 Costs ............................................................................................................................ 196
7.4.4 Analysis ....................................................................................................................... 198
7.4.5 Case Study – Cash Flow for 1 MW Plant ..................................................................... 199
7.5 Financial Analysis of a Rooftop Power Plant ....................................................................... 203
8. Summary, Inferences & Recommendations ............................................................................... 211
9. Glossary - Terms You Should Know as a Solar EPC ..................................................................... 213
9.1 Technical and Operational Terms ....................................................................................... 213
9.1.1 BOO Model (Build Own Operate Model) .................................................................... 213
9.1.2 Capacity Utilization Factor .......................................................................................... 213
9.1.3 Central Inverters ......................................................................................................... 214
9.1.4 Concentrating Photovoltaics ....................................................................................... 214
9.1.5 Cross Subsidy Surcharge ............................................................................................. 214
9.1.6 Crystalline Silicon/c-Si ................................................................................................. 215
9.1.7 DNI (Direct Normal Irradiance) ................................................................................... 215
9.1.8 Feed-in-Tariff ............................................................................................................... 216
9.1.9 Grid-tied Solar Power System ..................................................................................... 216
9.1.10 Grid Parity ................................................................................................................... 216
9.1.11 LCOE (Levelized Cost of Energy) .................................................................................. 217
9.1.12 Module ........................................................................................................................ 217
9.1.13 Module Degradation ................................................................................................... 218
9.1.14 Net metering ............................................................................................................... 218
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9.1.15 Off-grid Solar ............................................................................................................... 219
9.1.16 Open Access ................................................................................................................ 219
9.1.17 Pyranometer ............................................................................................................... 219
9.1.18 Reflection Losses in Solar Cells ................................................................................... 220
9.1.19 Shading of solar panels ............................................................................................... 220
9.1.20 Smart Grid ................................................................................................................... 220
9.1.21 String Inverters ............................................................................................................ 221
9.1.22 Standard Test Conditions (STC) ................................................................................... 221
9.1.23 Temperature Coefficient of Solar Panels .................................................................... 221
9.1.24 Thin Film Solar Cell ...................................................................................................... 222
9.1.25 Tracker ........................................................................................................................ 222
9.1.26 Watt Peak (Wp) ........................................................................................................... 222
9.1.27 Wheeling Charges ....................................................................................................... 223
9.2 Explanation of Key Financial Terms .................................................................................... 223
9.2.1 Payback Period ............................................................................................................ 223
9.2.2 Return on Investment (ROI) ........................................................................................ 223
9.2.3 Net Present Value (NPV) ............................................................................................. 224
9.2.4 IRR (Internal Rate of Return) ....................................................................................... 224
9.2.5 Levelized tariff ............................................................................................................. 224
9.2.6 PPA .............................................................................................................................. 225
9.2.7 Financial Closure ......................................................................................................... 225
9.2.8 Accelerated Depreciation ........................................................................................... 225
9.2.9 Discounting Factor ...................................................................................................... 225
9.2.10 Hedging ....................................................................................................................... 226
9.2.11 Moratorium ................................................................................................................. 226
9.2.12 With recourse/Without recourse ............................................................................... 226
9.3 Solar Apex Bodies & Organizations in India and their Roles ............................................... 226
9.3.1 MNRE .......................................................................................................................... 226
9.3.2 CWET/NIWE ................................................................................................................ 227
9.3.3 SECI .............................................................................................................................. 227
9.3.4 SESI .............................................................................................................................. 227
9.3.5 NSEFI ........................................................................................................................... 228
9.3.6 SERIIUS ........................................................................................................................ 228
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9.3.7 CSRI ............................................................................................................................. 228
10. Annexure ................................................................................................................................. 229
10.1 Details of Solar Policies & Regulations ................................................................................ 229
10.2 Estimation of High Potential C&I sectors for Rooftop and Ground-Mounted Solar ........... 233
10.3 Bill of Materials Format ...................................................................................................... 234
10.4 Tax Break-up for a Typical MW-Scale, Ground-Mounted Plant .......................................... 237
10.5 Project Implementation Schedule Format .......................................................................... 239
10.6 List of key component suppliers – for Panels, Inverters, Cables, Mounting Structures,
Monitoring Systems ........................................................................................................................ 241
10.6.1 Modules ...................................................................................................................... 241
10.6.2 Mounting Structures ................................................................................................... 241
10.6.3 Cables .......................................................................................................................... 241
10.6.4 Inverters ...................................................................................................................... 242
10.6.5 Battery ......................................................................................................................... 242
10.6.6 IT Solution Providers ................................................................................................... 242
10.7 DPR Template for a Solar PV Power Plant .......................................................................... 243
10.7.1 Components of a Detailed Project Report .................................................................. 243
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List of Figures Figure 1: Radiation map of India ---------------------------------------------------------------------------------------- 19
Figure 2: Choosing the Region for a MW Scale Plant -------------------------------------------------------------- 22
Figure 3: Yearly Proposed Targets For Rooftop And Ground-mounted Solar PV (Source: MNRE) ------ 24
Figure 4: Total Rooftop Solar Installed Capacity (Source: Solar Mango Estimate) ------------------------- 30
Figure 5: India Solar Installations (MW) (Source: AF Mercados EMI) ------------------------------------------ 32
Figure 6: Revenue Models for MW Scale Solar --------------------------------------------------------------------- 65
Figure 7: State-wise installed capacity (source: MNRE & Solar Mango Analysis) ------------------------- 110
Figure 8: Market Share of Solar PV Technologies ---------------------------------------------------------------- 166
Figure 9: Classification Of Silicon Technologies (Source: Solar Mango) ------------------------------------- 167
Figure 10: Types of Inverter based on Modularity --------------------------------------------------------------- 169
Figure 11: Grid Tied System -------------------------------------------------------------------------------------------- 170
Figure 12: Off-Grid System --------------------------------------------------------------------------------------------- 170
Figure 13: Hybrid System ----------------------------------------------------------------------------------------------- 171
Figure 14: effect of tilt on energy capture ------------------------------------------------------------------------- 172
Figure 15: DC Cables ----------------------------------------------------------------------------------------------------- 174
Figure 16: Junction Box ------------------------------------------------------------------------------------------------- 175
Figure 17: Plug Connectors--------------------------------------------------------------------------------------------- 176
Figure 18: DC Disconnects for SPP ----------------------------------------------------------------------------------- 177
Figure 19: AC Cables ----------------------------------------------------------------------------------------------------- 177
Figure 20: Analytics from DataGlen Monitoring Solution ------------------------------------------------------ 179
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List of Tables Table 1: Strengths and Assets of a Successful EPC ----------------------------------------------------------------- 20
Table 2: Evaluation of Key Strengths and Assets - Sample Format --------------------------------------------- 21
Table 3: Differentiators for a Successful EPC ------------------------------------------------------------------------ 22
Table 4: Prominent locations with good radiation where solar plants/parks have been constructed 27
Table 5: Estimated CUF and Generation – Sample Data from Some States ---------------------------------- 28
Table 6: Levers Impacting Growth of Utility Scale Solar In India (Source: Solar Mango) ----------------- 32
Table 7: Levers Impacting Growth of Rooftop Solar In India (Source: Solar Mango) ---------------------- 33
Table 8: State-wise Commissioned Capacity of Grid-connected Solar Power Projects – Latest Figures:
31.05.2016 (Source: Solar Mango) ------------------------------------------------------------------------------------- 36
Table 9: Projected Solar Capacity Additions in India From 2015-2020 (Source: EAI and Bridge to India)
---------------------------------------------------------------------------------------------------------------------------------- 42
Table 10: Installed Capacities under Various Business Models - Ground-Mounted (Source: Solar
Mango Estimates) ---------------------------------------------------------------------------------------------------------- 44
Table 11: Growth Rate under Various Business Models – Ground-Mounted (Source: Solar Mango
Estimates) -------------------------------------------------------------------------------------------------------------------- 44
Table 12: Capacity added under CAPEX and OPEX Models (in MW) (Source: Solar Mango Estimate) 45
Table 13: Projected Capacity Additions under Various Business Models - Rooftop ----------------------- 45
Table 14: Allocations and Bidding Results ---------------------------------------------------------------------------- 50
Table 15: Solar Tariffs in AP ---------------------------------------------------------------------------------------------- 54
Table 16: Solar Tariffs in Gujarat---------------------------------------------------------------------------------------- 56
Table 17: Solar Tariffs in Karnataka ------------------------------------------------------------------------------------ 58
Table 18: Solar Tariffs in MP --------------------------------------------------------------------------------------------- 59
Table 19: Solar Tariffs in Rajasthan ------------------------------------------------------------------------------------ 61
Table 20: Solar Tariffs in Tamil Nadu ---------------------------------------------------------------------------------- 62
Table 21: Solar Tariffs in Telangana ------------------------------------------------------------------------------------ 64
Table 22: Summary of Tariffs in Different States ------------------------------------------------------------------- 65
Table 23: Recently Concluded PPAS in UP ---------------------------------------------------------------------------- 66
Table 24: Recently Concluded PPAs in Rajasthan ------------------------------------------------------------------ 67
Table 25: Some Recently Concluded PPAs in AP -------------------------------------------------------------------- 67
Table 26: Recently Concluded Solar Allocation in Jharkhand ---------------------------------------------------- 68
Table 27: Bidding Results of Jharkhand Auction -------------------------------------------------------------------- 68
Table 28: Solar Tariffs under Jharkhand Allocation ---------------------------------------------------------------- 68
Table 29: Karnataka 1.2 GW Solar Auction Results ---------------------------------------------------------------- 69
Table 30: Solar Tariffs in Karnataka Auction - 1.2 GW ------------------------------------------------------------- 70
Table 31: Net Metering Summary - Maharashtra ------------------------------------------------------------------ 73
Table 32: GBI Scheme in Delhi ------------------------------------------------------------------------------------------ 74
Table 33: Net Metering Summary - Delhi----------------------------------------------------------------------------- 74
Table 34: Net Metering Summary - Tamil Nadu -------------------------------------------------------------------- 75
Table 35: Net Metering Summary - Karnataka ---------------------------------------------------------------------- 75
Table 36: Net Metering Summary - Andhra Pradesh -------------------------------------------------------------- 76
Table 37: Project Capacity under REC scheme (Source: Solar Mango Estimates) -------------------------- 76
Table 38: Solar RECs – Sales Until AUG 2015 ------------------------------------------------------------------------ 77
Table 39: Pros and Cons of various Business Models -------------------------------------------------------------- 82
Table 40: Analysis of Key Characteristics of Region-wise Segments (Rooftop Solar) ---------------------- 87
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Table 41: Analysis of Key Characteristics of End-user Segments (Rooftop Solar) -------------------------- 90
Table 42: Analysis of Key Characteristics of kW-size Residential Projects ------------------------------------ 96
Table 43: Analysis of Key Characteristics of C&I Projects --------------------------------------------------------- 99
Table 44: Analysis of Key Characteristics of Ground-Mounted Solar Projects ---------------------------- 106
Table 45: Prominent Installations in AP ----------------------------------------------------------------------------- 109
Table 46: Prominent Installations in Gujarat ---------------------------------------------------------------------- 110
Table 47: Prominent Installations in Haryana --------------------------------------------------------------------- 110
Table 48: Prominent Installations in Karnataka ------------------------------------------------------------------- 111
Table 49: Prominent Installations in MP ---------------------------------------------------------------------------- 111
Table 50: Prominent Installations in Maharashtra --------------------------------------------------------------- 113
Table 51: Prominent Installations in Telangana ------------------------------------------------------------------- 113
Table 52: Prominent Installations in Rajasthan ------------------------------------------------------------------- 114
Table 53: Prominent Installations in Tamil Nadu ----------------------------------------------------------------- 114
Table 54: Rooftop Solar EPCs in India (Source: Solar Mango Estimates) ----------------------------------- 119
Table 55: EPCs in the Ground-mounted Sector (Source: Solar Mango Estimates) ----------------------- 119
Table 56: Companies Diversifying into EPC Business - Trends ------------------------------------------------- 122
Table 57: Summary of High Potential States ----------------------------------------------------------------------- 136
Table 58: Potential Market Segments- Commercial & Industrial Sector ------------------------------------ 139
Table 59: Cost Estimates for Solar EPC Operations -------------------------------------------------------------- 143
Table 60: EPC Margins (% of Total Project Cost) - Indicative -------------------------------------------------- 144
Table 61: Forecasted Growth of Rooftop OPEX Installations (Solar Mango Estimate) ------------------ 147
Table 62: Scope of OPEX Model in Rooftop and Off-Site Solar Generation -------------------------------- 148
Table 63: End-User -Shopping Mall ---------------------------------------------------------------------------------- 149
Table 64: End-User -I.T Park ------------------------------------------------------------------------------------------- 150
Table 65: End-User: Private Educational Institution ------------------------------------------------------------- 150
Table 66.End-User –Chemicals manufacturer --------------------------------------------------------------------- 151
Table 67.End-User - Warehouse -------------------------------------------------------------------------------------- 152
Table 68: Parameters for Selection of Solar Power Plant Components (Source: Solar Mango) ------ 159
Table 69: Suggestions for Shortening Sales Cycles --------------------------------------------------------------- 169
Table 70: Parameters on which Prospects Evaluate Solar EPCs ----------------------------------------------- 178
Table 71: Classification of EPCs --------------------------------------------------------------------------------------- 182
Table 72: EPCs as OEMs & Developers ------------------------------------------------------------------------------ 196
Table 73: Portion of land required for what purpose ----------------------------------------------------------- 202
Table 74: Expected Generation for a 2 MW SPP ------------------------------------------------------------------ 205
Table 75: Pros and Cons of Crystalline Panels (Source: Solar Mango) --------------------------------------- 209
Table 76: Market Share of Silicon Technologies (Source: Solar Mango Estimate) ----------------------- 209
Table 77: Details on Cost of Grid Extension ------------------------------------------------------------------------ 222
Table 78: STANDARDS AND WARRANTIES FOR CRITICAL COMPONENTS----------------------------------- 224
Table 79: CERC benchmark cost breakup for a 1 MW ground mounted solar PV power plant 2016-17
(Source: CERC)------------------------------------------------------------------------------------------------------------- 225
Table 80: COMPARISON OF CERC BENCHMARK CAPITAL COST 2010-16 (RS. LAKHS) ------------------- 227
Table 81: COMPARISON OF CERC BENCHMARK CAPITAL COST 2010-15 (% OF TOTAL COST) -------- 228
Table 82: Cash Flow for a 1 MW Plant ------------------------------------------------------------------------------ 234
Table 83: IRRs ------------------------------------------------------------------------------------------------------------- 237
Table 84: Degradation in Panel Generation ------------------------------------------------------------------------ 240
Table 85: Usable Power Generated by a 100 kW Solar Plant -------------------------------------------------- 241
Table 86: Inverter Replacement Cost -------------------------------------------------------------------------------- 242
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Table 87: Annual Maintenance Contract Cost --------------------------------------------------------------------- 243
Table 88: Typical Solar Power Plant Components and Technical Details ----------------------------------- 268
Table 89: Tax break-up for a typical solar PV project ------------------------------------------------------------ 271
Table 90: Project Implementation Schedule - Sample Format ------------------------------------------------ 273
Table 91: List of Inverters ---------------------------------------------------------------------------------------------- 276
Table 92: List of IT Solution Providers ------------------------------------------------------------------------------- 276
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Action Plan for Becoming a
Successful Solar EPC Becoming a solar EPC looks easy enough – after all, it requires no capital upfront, and appears to need
only easily accessible skills in electrical and construction projects. Dig a bit deeper, and you realize that
while anyone can become a solar EPC quite easily, only a few will graduate to become really successful
EPCs.
While this blueprint provides extensive details on how to build a successful EPC business, here are the key
building blocks for building a great solar EPC business, mentioned in the form of an Action Plan. Ensure
you start working on each of these building blocks, with the help of insights provided in the various
chapters of this guide.
Remember, the key aspects mentioned under each of the four dimensions need to be worked on right in
the beginning of an EPC business. That is why these are called the building blocks!
We have decided to structure the Action Plan on the following dimensions:
Market
Skills
Differentiation
Partnerships
Market Decide the market to focus on. Trying to focus on any market is as good as trying to focus on no
market. Extensive details on the various markets to focus on are provided in this blueprint. Depending on
your strengths and existing assets you can leverage (which includes your location), decide on the markets
you will focus on in the first couple of years.
Become an early mover. Whatever be your industry, being an early mover gives you considerable
advantage. Try to quickly latch on to some of the emerging opportunities in the Indian solar sector, so
that you have this advantage. Remember, the same effort applied to an emerging opportunity could
provide 3-5 times the returns that such an effort would for a crowded marketplace. Details of such
emerging opportunities are provided in many sections of this report.
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Skills
Invest in getting key skills in your team. Three different skill sets are required for you to build an
EPC business that can succeed in a sustained manner. Design & engineering skills, project management
skills and business development skills. Ensure that you invest time and money in procuring these skills in
your team. It could be tempting to outsource some or all of these, but we can tell you it is a bad idea.
Differentiation
Differentiate. You can differentiate in any business. If companies can differentiate in selling water and
salt, achieving differentiation in a service sector such as solar EPC must be far easier. All across this guide,
you will see direct and indirect insights that can be used by your team to arrive at a sustainable
differentiation for your EPC offering. Ensure you spend time and energy to kick off the differentiation
process right in the beginning.
Partnerships
Invest in powerful partnerships. An EPC service is not your product. The product you are promising
your customer is actually a well-functioning solar PV power plant. It thus follows that in order to deliver a
great product, it is not enough if you and your team members are good enough. Every partner of yours –
be it the component vendors, logistics partners or communications partner – needs to be well qualified.
Invest time and energy in building a powerful partnership ecosystem.
Whichever way you wish to read this guide, please ensure that you incorporate as many recommendations
as possible provided for the above four key aspects into your business. All along this blueprint, you will
find examples, insights and suggestions for all the aspects mentioned above.
The India Solar EPC blueprint report provides insights on how each of the above aspects
can be leveraged to the client’s advantage.
The following section provides a list of useful data and resources that could come in handy as a starting
point for businesses planning to become solar EPCs.
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Before You Start This section provides you quick pointers on some immediate actionable to promote your EPC business
and useful data resources available in the report.
List of Upcoming Solar Events
Event Name Date & Location Website
Intersolar India Oct 19th – 21st, 2016 -
Mumbai
https://www.intersolar.in/
Renewable Energy India
Expo
7th -9th Sept, 2016 -
India Expo Centre,
Greater Noida, India
http://www.renewableenergyindiaexpo.com/
National Conference &
Expo Roadmap for
Innovation in Solar
Energy - RISE 2016
22nd – 23rd Sept, 2016 –
Mumbai
http://www.solar.missionenergy.org/
4th International
Conference & Exhibition
on Energy Storage &
Micro-grids in India
12th Jan 2017 – Nehru
Centre, Mumbai
http://www.esiexpo.in/
World Renewable Energy
Technology Congress &
Expo
21st - 23rd Aug, 2016 –
New Delhi
http://wretc.in/
Rooftop Solar
Construction
Management
28th – 29th July, 2016 –
Hotel The Suryaa, New
Delhi
http://solarquarter.com/index.php/events/849-
rooftop-solar-construction-management
Solar PV Module Tech
India 2016
4th August, 2016 –
Hotel The Suryaa, New
Delhi
http://firstviewgroup.com/index.php/upcoming-
events-2/business-events/solar-pv-moduletech-
india-2016
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List of Training Program & Institutes
Global Sustainable Energy Solutions India (GSES)
The Energy and Resources Institute (TERI)
National Institute of Solar Energy (NISE)
Gujarat Energy Research and Management Institute (GERMI)
Steinbeis Solar Research Centre
World Institute of Sustainable Energy (WISE)
kWatt Solutions Private Limited (kSPL)
SOLBIZZ- Solar Entrepreneur Training Program
List of Magazines & Websites
Solar Today
Energetica India
Solar Quarter
EQ International
Bridge to India
Energy Alternatives India
Power Today
Other Partnerships
Here, Solar Mango lists down some of the prominent EPCs that you can consider partnering with:
L&T
Sterling & Wilson
Tata Power Solar
Waaree Energies
Mahindra Susten
Photon Solar
Vikram Solar
Swelect Energy Systems Limited
CleanMax Solar
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Premier Solar
Useful Data Resources
Please refer the sections and tables listed below for some useful information that may come in handy for
potential and prospective EPCs.
Section 10.6 - List of key component suppliers – for Panels, Inverters, Cables, Mounting Structures,
Monitoring Systems
Section 7.3 - Technical Features and Equipment for a Solar Power Plant
Section 9.3 - Solar Apex Bodies & Organizations in India and their Roles
Table 58 - Parameters for Selection of Solar Power Plant Components (Source: Solar Mango)
Table 64: Standards and Warranties for Critical Components
Section 10.1 - Details of Solar Policies & Regulations
Section 10.3 - Bill of Materials Format
Section 10.5 - Project Implementation Schedule Format
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1. Solar Power Potential in India
This detailed chapter provided inputs and insights on the solar potential, growth
trends and the key policy and other drivers contributing to the growth of the industry.
Topics Covered
Solar Potential in India
Solar Power Growth & Trends
Overview of Central & State Government
Solar Policies
Business & Revenue Models
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1.1 Solar Potential in India
A solar plant should be located in a region where there is plenty of sunshine. The map on the following
page can be used to estimate solar radiation at the location of the site.
FIGURE 1: RADIATION MAP OF INDIA
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1.2 Solar Power Growth & Trends
1.2.1 Lever's Affecting Growth of Solar PV in India
The answer to whether India will reach 100 GW by 2022 depends on a variety of factors. Electricity being
a concurrent subject is influenced by decisions both at the Central and State levels. Solar Mango has
consolidated a list of key drivers which we believe will drive solar growth in India. Each of these drivers
has the potential to become possible game changers for the Indian Solar industry.
In our analysis, we have pointed which of these drivers are likely to play out by the end of 2016 and 2020.
1.2.2 Across specific segments
1.2.2.1 Rooftop
Despite the 40 GW target set by the government under the JNNSM mission, rooftop solar has a cumulative
installed capacity of only 850 MW as of June 2016, which contrasts with the rate of capacity addition in
the ground-mounted utility-scale sector.
1.2.2.2 Future Capacity-Additions
The following table lists EAI’s (parent of Solar Mango) year wise estimated solar capacity addition in India.
TABLE 1: PROJECTED SOLAR CAPACITY ADDITIONS IN INDIA FROM 2015-2020 (SOURCE: EAI AND BRIDGE TO INDIA)
Capacity
Added-
Utility
Scale
Capacity
Added-
Rooftop
Solar
Cumulative
end of year
(MW)
Capacity
Added-
Utility
Scale
Capacity
Added-
Rooftop
Solar
Cumulative end
of year (MW)
2016
2017
2018
2019
2020
Year EAI Bridge to India
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1.3 Overview of Central and State Government Solar Policies
TABLE 2: SUMMARY OF TARIFFS IN DIFFERENT STATES
State Year
AD/Non
-AD
Tariff
Comments Low High
Andhra
Pradesh
2015 N/A 4.63 No escalation in tariff.
Chhattisgarh 2014 N/A 6.46 7.9 No escalation in tariff.
Gujarat 2015 N/A Tariff:
Yrs. 1-12 – Rs. 15
Yrs. 13-25 – Rs. 5
Jharkhand 2016 N/A 5.08 7.90 No escalation in tariff.
Karnataka 2014 N/A 6.71 7.12 No escalation in tariff.
Madhya
Pradesh
2014 N/A 6.47 6.97 No escalation in tariff.
Maharashtra 2014 N/A 7.95 Tariff fixed by MERC for plants commissioned in
2014-15. No escalation in tariff.
Punjab 2013 N/A 7.2 8.71 For 1-4 MW capacity. No escalation in tariff.
Punjab 2013 N/A 7.67 8.74 For 5-30 MW capacity. No escalation in tariff.
Rajasthan 2014 No 7.5 Tariff fixed by RERC for plants commissioned until
31.03.2016. No escalation in tariff.
Rajasthan 2014 Yes 6.63 Tariff fixed by RERC for plants commissioned until
31.03.2016. No escalation in tariff.
Tamil Nadu 2014 No 7.01 Tariff fixed by TNERC for plants commissioned
until 31.03.2016. No escalation in tariff.
Tamil Nadu 2014 Yes 6.28 Tariff fixed by TNERC for plants commissioned
until 31.03.2016. No escalation in tariff.
Tamil Nadu 2016 No 5.10
(Revi
sed)
Tariff fixed by TNERC for plants commissioned
from 1.04.2016. No escalation in tariff.
Tamil Nadu 2016 Yes 4.56
(revis
ed)
Tariff fixed by TNERC for plants commissioned
from 1.04.2016. No escalation in tariff.
Telangana 2014 N/A 6.46 6.9 No escalation in tariff.
Uttarakhand 2014 N/A 6.85 7.98 No escalation in tariff.
Uttar Pradesh 2013 N/A 8.01 9.33 10-year PPA. If extended, tariff will be Yr. 11 APPC
escalating by 3% annually.
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1.4 Business & Revenue Models for Solar Power Plants in India
1.4.1 Business Models
CAPEX Model
OPEX Model
1.4.2 Revenue Models A utility scale Solar PV plant can be monetized through several avenues:
FIGURE 2: REVENUE MODELS FOR MW SCALE SOLAR
Pros and Cons of the Business Models
TABLE 3: PROS AND CONS OF VARIOUS BUSINESS MODELS
Biz Model Pros Cons
Sale to Utility Long term PPAs viable
and bankable, in the case
of at least some states
Large power plant PPAs
possible as the buyer is a
very large distributor of
power
Rates might not be very
attractive, especially in
the regime of competitive
(reverse) bidding
Poor health of state
DISCOMS could pose
payment delays and
hence poor cash flows
This model is allotment
driven and hence feasible
only under scenarios
where there are such
government allotments
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Biz Model Pros Cons
Sale to Private Consumer No need for government
policies or allotments,
purely market driven
Could have attractive
tariffs, as this is a bilateral
agreement between two
private parties
REC benefits can be
availed, though the
market for RECs is yet to
take off meaningfully
Long term PPAs are
difficult except in the
cases of very large
corporates
Large corporates might
set up their own captive
solar power plants
instead of buying from
third parties, and so there
might be challenges for
this attractive segment
High wheeling, banking
and cross subsidy charges
might weaken the
business case
Captive Consumption No need for government
policy or allotments,
purely driven by the cost
of energy
Tying in the cost of energy
for your company for 25
years, as against
uncertain grid power cost
escalations during the
same period
REC benefits can be
availed, though the
market for RECs is yet to
take off meaningfully
This might not be possible
for every developer. In
fact, IPPs in most cases
operate only power
plants and they have no
other businesses (though
they might have
companies that are
related to them in some
fiduciary way)
Captive power plants
require significant
upfront capital costs,
something many
companies might not find
feasible
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2. Indian Solar Market Segmentation
This chapter provided inputs and analyses of the Indian solar market along three dimensions:
Geography, End-users and Project Sizes. Characteristics and trends are analyzed for each
segment.
Topics Covered
Region-wise Segmentation
End-user Segmentation
Segmentation based on Project Size
24 | P a g e
2.1 Region
Solar Mango has identified the following characteristics that govern region-wise market segmentation.
Load shedding
Price sensitivity
Sizes
Cost of grid power
Region
Classification
Parameters
Load shedding Price
sensitivity
Sizes Cost of grid
power
Urban Not very frequent
like in rural areas
High dependence
of C&I sectors on
electricity makes
solar attractive
Highly
variable
among both
residential
and
industrial
/commercial
sectors
Medium-Large
scale solar
projects mainly
for C&I sectors
Gaining
popularity of
community
solar
Ground-
mounted
unsuitable due
to space
constraints and
high land cost
Depends on
the sector
(commercial,
industrial or
residential)
Semi-urban Quite frequent Moderate Community
solar (1-100
kW) could be a
viable option
Depends on
the sector
Rural Frequent
phenomenon due
to poor grid
connectivity
Solutions such as
solar with battery
storage could have
huge potential
Very price
sensitive
Off-grid
products and
large-scale
solar plants at
areas with
large tracts of
land
Depends on
the sector
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2.2 Type of end user
End-user
Classification
Parameters
Cost of grid
power
Size/scale of
solar power
requirement
Technology End use
applications
Price
sensitivity
Residential
Commercial
Industrial
Institutions
Government
2.3 Size of the project
2.3.1 Rooftop
2.3.1.1 kW size residential projects (1-10 kW)
Size of
Project
Parameters
Customer
profile
Motivation Type Price
sensitivity
Geography /
demographics
Other
Expectations
100 W-1 kW
1-3 kW
3-10 kW
Greater than 10
kW
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2.3.1.2 Industrial and commercial rooftop solar projects
Size of
Project
Parameters
Type/profile
of Customer
Motivation Business
Model
Type Price
sensitivity
Other
Expectations
10-25
kW
25-100
kW
100-500
kW
Greater
than
500 kW
2.3.1.2.1 Case Studies – C&I Installations
1. RSSB (Amritsar, Punjab)
Tata Power Solar’s 12 MW, the World’s largest rooftop solar power plant as of Dec 2015
Tata Power Solar, India's largest integrated solar player, has successfully commissioned a 12 MW solar
rooftop project for R.S.S.B. Educational and Environmental Society in Amritsar in Punjab in Dec 2015.
Built across eight sheltered venues in a single premise at the Radha Soami Satsang Beas - Dera Baba Jaimal
Singh in Amritsar, the project is likely the largest solar rooftop plant in the world set up in a single phase.
The plant will produce more than 150 lakh units of power annually and offset over 19000 tonnes of carbon
emissions every year. More from here - http://bit.ly/1Z2Pc1K
L&T’s 7.5 MW for the Same Organization
At the time of installation (Jun 2014), this was the world’s largest single rooftop solar power project, which
was constructed on the campus roof of Radha Soami Satsang Beas (RSSB). The 7.52 MW plant was
commissioned in June 2014 and L&T was the chosen EPC to construct this project.
27 | P a g e
The RSSB project has around 30,096 PV modules of 250 Wp each, 11.5 km walkway, 14 central type
inverters of 500 kWp each, seven transformers, 140 junction boxes, and 44,000 of J-Bolts used for Module
Mounting Structure and Walkway. The total cost of the project is about Rs.48 Crore which includes the
cost of transmission network, substation, and transformer installations.
It also claims to have a simple payback period of around six years. By 2016, the RSSB plans to set up a total
of 27 MWp capacity peak grid connected rooftop plant. Out of this, the 5 MWp capacity will be added
soon to make the total capacity up to 12.524 MWp.
The energy generated from this plant is being fed to the local grid through a power purchase agreement
(PPA) signed with the state distribution company under the New and Renewable Sources of Energy (NRSE)
Policy.
2. Murugan Textiles (Coimbatore, Tamil Nadu)
This is the largest rooftop solar project of 2 MW in South India. Murugan Textiles is the first power loom
producer to use 100% renewable energy. The project is a hybrid model of renewable energy consumption,
using both solar and wind energy. Used for captive consumption, Murugan textiles produces 25% of their
electricity requirement through solar, and the rest though wind energy.
While there is no grid power shortage, the grid electricity is used only as a back up to renewable energy
when required. The power loom industry is electricity-intensive and requires power 24X7. Open-end
spinning machines are more power intensive than conventional machines, and need continuous power.
The structures were custom designed, to withstand high winds in the region, without creating any impact
on the existing building and rooftop. The rooftop design saved nearly 10 acres of land space, which would
have been required for a standard project of this capacity.
It has 700kW on 1 rooftop and 650 kW each on 2 rooftops, with a cumulative area of 18,850 sq. m.
3. SRG Apparels (Tirupur, Tamil Nadu)
Waaree Energies has set up a 1.1 MW DV Solar PV-Diesel Hybrid power plants for SRG Apparels. 3,870 PV
modules of WAAREE Make WS-290WP capacity were installed on the rooftop of the solar project
developer’s existing textile plant.
The Rooftop Solar Photovoltaic Power (SPV) Plant commissioned in December 2013 is expected to
generate approximately 1.55 million units of energy annually.46 string inverters of 20KW capacity were
installed to convert DC power, from the PV source, to AC power. The stepped-up AC power was then
connected to the incoming 22 kV grid of TANGEDCO. The PV sources were combined with the existing 3
diesel generator (DG) Sets of 500KVA each, using SMA’s Fuel Save Controller, to meet the textile plant’s
connected load requirements during the day time. The system was installed under the REC mechanism
with captive use.
28 | P a g e
2.3.2 Ground-mounted
Project
Size
Parameters
Type/profile of
Developer/Investor
Typical
Business
Model
Type of
EPC
Margins
EPCs can
expect
Extent of Outsourcing
that could be
required
1-3 MW
5-10
MW
10-50
MW
50+
MW
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3. Solar EPCs in India
This chapter provided inputs on the various types of solar EPCs in India and their
characteristics.
Topics Covered
Rooftop & Ground-mounted EPCs
Turnkey EPCs
EPCs with Local/Regional Focus
EPCs taking up mainly Sub-contract Works
Specific Functions Alone
Pure-Play Design Firms
EPCs with O&M Focus
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3.1 EPC with focus on:
3.1.1 Rooftop solar power plants
TABLE 4: ROOFTOP SOLAR EPCS IN INDIA
Segment Number of EPCs Major EPCs operating in this
sector
Residential 500-700 Many small EPCs, with most of
them having no brand visibility
at all
Small C&I (25-50 kW) 100 Evolve India, Aspiration Energy,
U Solar, Ranergy
Medium C&I (25 – 100 kW)
Large C&I (100 kW & above)
*Only does OPEX-based installations
3.1.2 Ground-mounted solar power plants
TABLE 5: EPCS IN THE GROUND-MOUNTED SECTOR
Segment Number of EPCs Major EPCs operating in this
sector
Small-medium (1-3 MW)
100 Premier Solar Systems
Photon Energy
Ranergy
Evolve India
Medium (3-10)
Medium-large (10-50)
Large & V large (50+)
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3.1.3 Companies Diversifying into EPC Business
There is a huge interest among businesses and the corporate sector in India (and from corporates outside
India too) to invest in this sector. Some of trends seen and companies involved have been tabulated
below.
TABLE 6: COMPANIES DIVERSIFYING INTO EPC BUSINESS - TRENDS
Trends Companies Details
Solar Companies
vertically
integrating along
the value chain
Renewsys Renewsys, which manufactures solar module
components – EVA encapsulant, backsheet etc., and
has also recently entered the module manufacturing
sector, plans to diversity downstream into solar PV
value chain by entering the EPC business.
Wind Power Firms
diversifying into
solar
3.2 Turnkey EPCs
1) Larsen and Toubro Construction – Solar Projects – L&T have commissioned several hundred MWs on
ground in India, and also built one of the largest rooftop solar plants in India of 7.52MWp in Punjab.
They have also provided financing assistance for solar projects of different capacities.
3.3 EPCs with Local/Regional Focus
Well, there are both pros and cons for EPCs to be regional/local focused.
32 | P a g e
3.4 EPCs taking up mainly sub-contract work from larger EPCs
A number of small EPCs are starting off this route – rather than undertake costly marketing and promotion
to win full EPC business, they instead market it the B2B way – they market themselves to the larger EPCs
who give them a slice of the total turnkey implementation.
3.5 EPCs taking up mainly sub-contract work from larger EPCs
Another special type of an “EPC” is one who specializes in only one aspect of the solar power plant
implementation, for instance, only on civil works – you could even say that such a firm cannot be
technically called an EPC as they do not perform all the roles that EPCs perform.
3.6 Pure- play design firms
While most EPCs ostentatiously have design teams, these teams mostly comprise individuals with some
knowledge of design, but not a real lot. As a result, many of these EPCs (both small and large) sometimes
turn to specialized design firms, who focus almost entirely on solar power plant design.
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4. Business Potential & Challenges
for Solar EPCs in India
This is an important section as analyses of where the greatest potential lies and focusing on
those segments is key to any business success, and so too in the case of EPCs.
Topics Covered
Segment-wise Potential
Region-wise Potential
Industry-wise Potential (for Rooftop &
Captive)
Costs and Potential Returns for EPCs
Growth Opportunities for Solar
Key Operational Challenges for Solar EPCs
General Risks EPCs Should Be Aware of
Key Mistakes to Avoid
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4.1 Segment-wise Potential
Ground Mounted Potential
As of Jul 2016, of the 7500 MW installed capacity of solar power in India, almost 90% of installations are
ground mounted solar power plants with capacities 1 MW and above.
This statistic alone shows the potential of ground mounted solar power plants in the country today.
Rooftop Solar
Starting 2014, both the adoption of rooftop solar, as well as interest of the major EPCs in this sector,
started showing a significant increase.
By 2015, almost every large EPC had done some rooftop solar installations at least. Even EPCs such as L&T
did some rooftop solar projects, albeit pretty large ones (L&T did one of the world’s largest rooftop solar
projects in Punjab, of 7.5 MW, in Amritsar in Sep 2014).
4.2 Region-wise Potential
4.2.1 High Potential States – current and future
Broadly, Solar Mango analyses the following parameters for the top states:
Installed Capacity
Policy Framework
Power Evacuation Infrastructure
Economic fundamentals
State of Discom
35 | P a g e
FIGURE 3: STATE-WISE INSTALLED CAPACITY (SOURCE: MNRE & SOLAR MANGO ANALYSIS)
Gujarat and Rajasthan which had been leading the race in 2015 has seen a slower growth. This has been
especially true with Gujarat which is a power surplus state with lower grid tariffs.
Having set a very ambitious solar policy, things haven’t gone according to plan in Karnataka. The partial
failure of the Karnataka Land Owning Farmer’s Scheme (with a tariff of Rs 8.4/kWh) has seen a lack of
inertia in solar deployment in the state. Due to the recent auctions by SECI and reframing of state policies,
it is to be seen if growth rate in Karnataka picks up.
TAKEAWAY- High potential states
With southern states being the focus of recent allocations, there appear to be more
opportunities for prospective EPCs in states like Tamil Nadu, Andhra Pradesh and
Telangana
This also means that the competition will be very high due to larger concentration of EPCs
within these states. In order to compete in such a market, new or small EPCs should
partner with larger EPCs or should obtain unique positioning to win orders.
0
200
400
600
800
1000
1200
1400M
W
State-wise Installed Capacity (MW)
As of May 2016 As of March 2015
36 | P a g e
4.2.2 High Potential Cities & Towns – Current and Future
Due to the inherent problem of space constraints, solar installations in cities are predominantly rooftop-
based. Hence, the focus of discussions in this section revolves around rooftop solar.
TAKEAWAY – High potential cities & towns
While some cities are attractive due to the high grid tariffs, others have good policy
framework for solar.
Delhi has been an early promoter of rooftop solar with government rolling out supportive
policies for solar installations through GBIs for domestic consumers and introducing
innovative concepts like virtual and group metering. Mumbai, due to its sky rocketing grid
tariffs naturally provides a business case for solar especially for C&I establishments.
Chennai, being part of a progressive state with high degree of industrialisation has also been
welcoming for solar.
UTs like Chandigarh is another attractive destination for solar. Apart from the supportive
policy framework provided by the local government, Chandigarh has a high concentration
of people from the high-income society which is a market segment that can be readily
exploited by EPCs.
Other cities and towns that hold potential are those that host industrial clusters. In this
context, it is interesting to note that such industry-cluster towns such as Tiruppur (textiles)
and Hosur (engineering) have seen significantly rooftop solar adoption rates than
towns/cities of equivalent sizes and inherent potential.
EPCs might also want to keep their eyes on those cities that have been designated as Solar
Cities by MNRE. (http://mnre.gov.in/schemes/decentralized-systems/solar-cities/)
4.3 Industry-wise Potential (for rooftop & captive)
4.3.1 Attractive C&I Sectors
Solar Mango has estimated the potential of C&I segments for both rooftop and off-site systems by
evaluating six parameters. They are:
1. Profit Margins
2. Day-time energy consumption
3. Overall Energy consumption
4. Availability of Rooftop Space
37 | P a g e
5. Grid Tariff, and
6. Pioneer Mentality
4.3.2 Attractive Institutional Sectors Airports
Sea Ports
Railways
Metros
4.4 Costs & Potential Returns for EPCs
4.4.1 Costs to run solar EPC operations
TABLE 7: COST ESTIMATES FOR SOLAR EPC OPERATIONS
Category Costs Notes
Set-up costs
Running Costs
Wages
Marketing
Rent & electricity
Other expenses –
communication, travel
Total running costs
4.4.2 Margins made by Solar EPCs in India TABLE 8: EPC MARGINS (% OF TOTAL PROJECT COST) - INDICATIVE
Segment Gross Margins (%) Net Margins (%)
Rooftop solar – high quality
Rooftop solar – average
quality with price sensitive
customer
38 | P a g e
Ground mounted power plants
1-10 MW for a quality
conscious customer
Ground mounted power plants
1-10 MW at average quality
and for price conscious
customer
Large ground-mounted power
plants
4.5 Growth Opportunities for Solar EPCs
4.5.1 Value Added Services that can be provided by EPCs
Strategic Supply Partnerships
High quality EPCs will have access to large and cost-effective supply arrangements with leading module,
inverter and racking suppliers, and other balance of system components.
Power Purchase Agreements
While signing of PPAs is in the domain of developers, high quality EPCs can utilize their knowledge of the
solar sector to assist clients in signing up PPAs, especially where PPAs are signed with private companies
for power offtake. Many of the renowned EPCs have experience of negotiating 100s of MWs of PPAs and
have a deep understanding of the legal, commercial and technical provisions necessary to allow a solar
energy project to achieve commercial operation and financial close on a timely basis.
Financing Assistance
Financial closure, similar to PPA signing, does not actually come under the ambit of EPCs but many
renowned EPCs assist their clients in financial closures too. These EPCs have excellent relationships with
banks and other financial institutions and thus could provide developers value far beyond pure EPC.
Operation, Maintenance and Monitoring Services
EPCs can also take up long-term operations, maintenance and monitoring support and services for the
power plants. They can also administer warranty claims and supply product services to ensure that the
facilities will maintain a high level of performance.
39 | P a g e
4.5.2 Technology innovations
1. Non-penetrating mounting structures
The typical solar installation on a concrete roof requires mounting structures that penetrate the roof,
raising concerns with waterproofing and other structural issues in some buildings. The use of non-
penetrating mountings has allowed solar plants to be mounted on such buildings. This is widely used in
India.
2. Elevated mounting structures
Mounting structures that elevate the solar panels above the roof allow the roof to be also used for other
purposes, may create a slightly cooler top floor, and increase panel cooling due to greater exposure to the
wind. This has been frequently used in India.
3. East-West layout
Solar plants in the northern hemisphere are typically mounted facing south in the direction of the Sun.
However, locations within the tropical zone do not always have the sun towards the south. L&T has
experimented with East-West layout for panels in such locations and claims increased energy output.
There are only a few such installations in India.
4. Diesel substitution
Diesel for power generation is a problem unique to India and several other developing countries. The need
to maximize diesel savings from solar has given rise to several solutions, such as special inverters that can
control multiple diesel generators, and software solutions that can manage multiple solar inverters and
diesel generators based on load. This solution is being increasingly adopted in India.
5. Critical load support
By isolating critical loads through a dedicated electrical feeder, a solar power plant with battery backup
can ensure that the critical load is always supported, and no disruption of production is experienced
despite unscheduled load shedding. This solution is being increasingly adopted in India.
6. BIPV
Building Integrated Photovoltaics can be integrated such that it blends with the surrounding materials and
is aesthetically pleasing. Normal solar installations are noticeable and many homeowners are turned off
by the fact that it ruins the buildings aesthetics. BIPVs can be in the form of Solar Shingles or colored
panels or directly integrated Solar panels (they function as the roof itself without other mounting
structures).
This technology has been commercialized, but is hampered by poor efficiency and high cost.
40 | P a g e
7. Concentrating Solar PV
Mirrors and Lenses can be utilized to increase the power output of solar panels installed. This technology
has been commercialized but the weight of the installation makes it unsuitable for most rooftop
applications.
8. Powerwall
The Powerwall, developed by Tesla Energy, is a lithium-ion battery pack that automates storage and
discharge of solar power to take advantage of time-of-day pricing for electricity consumers. Powerwalls
will be delivered to customers later this year, which is when the effectiveness of the solution can be
judged.
9. Wind- Hybrid System
A small hybrid electric system that combines wind and solar technologies can offer several advantages
over either single system. Because the peak operating times for wind and solar systems occur at different
times of the day and year, hybrid systems are more likely to produce power when you need it. Many
hybrid systems are stand-alone systems, which operate "off-grid"-- not connected to an electricity
distribution system. For the times when neither the wind nor the solar system are producing, most hybrid
systems provide power through batteries and/or an engine generator powered by conventional fuels,
such as diesel. If the batteries run low, the engine generator can provide power and recharge the
batteries.
10. Solar Smart Grids
A smart grid is a system that is adaptive, interactive, secured, supports bi-directional energy flow and has
no geographical or organizational boundaries. The benefits of smart grid can be enhanced through the
integration of non-conventional energy sources like Solar, Wind and Biomass power plants. Solar power
takes the prominent position among all other sources due to its continuous availability and cost
effectiveness. Further the Smart Grid technology will open up more opportunities for solar power by
providing a new energy value chain, linking renewable and conventional power generation to reduce CO2
emissions, and enhance utilization through reliable operation.
The presence of Smart Grid will help to streamline the distributed solar power generation using rooftop
solar arrays to feed electricity into the grid during daylight in order to meet the peak demand.
TAKEAWAY – Value Added Services that can be provided by EPCs
In order to position itself as a high quality EPC providing premium services, EPCs must seek out
opportunities that a conventional solar EPC doesn’t offer. Some useful offerings could include:
Assistance in financial closure by leveraging the relationship EPCs have with banks
41 | P a g e
Conducting negotiations with PPA signing for private PPAs
Partnering with high quality and reputed component suppliers
Offering asset management services over and above the regular O&M services
4.6 Key Operational Challenges for Solar EPCs in India
Infrastructural challenges
Purchasing Land – One, purchasing large tracts of adjacent land areas is always a challenge. This might
however not be a tough challenge if EPCs are responsible for land selection.
Project Implementation Challenges
Financial challenges
Liabilities for a Solar EPC
TAKEAWAY – Key Operational Challenges for solar EPCs in India
Among the operational challenges faced by solar EPCs in India, bottlenecks that arise during the
project execution phase are among the most critical. Delays in component delivery and right of way
bottlenecks can substantially delay construction of solar projects resulting is considerable financial
losses for EPCs.
Post implementation, the power plant failing to meet the stipulated amount of energy generation
as per contract can result in penalties for EPCs. Employing effective monitoring solutions as part of
the O&M services could be one method of mitigating this problem.
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5. Insights & Recommendations
How can businesses win in the market? One of the sure shot ways is to build sustainable
competitive advantages. This chapter, a critical one for EPCs, looks at how EPCs can build
assets critical to success and at the same time differentiate themselves from the rest of the
pack. Insights are provided on the following:
Topics Covered
Skills and Human Resources
Insights on Marketing, Sales &
Distribution
Best of Breed Practices
Opportunities for Innovation
Identifying Profitable Niches
Leveraging Technology Parameters for Evaluating Solar EPCs by
Prospects
43 | P a g e
5.1 Skills and Human Resources Solar EPCs Need
In order to excel in a highly competitive and dynamic market, EPCs must ensure that the right guys with
right skillsets are hired. Solar power plant implementation jobs require personnel with a good blend of
technical as well as managerial expertise.
Project management
Sales Professional
Electrical engineer
Solar PV design specialist
TAKEAWAY – Skills and human resources solar EPCs need
Being a business that is highly people dependent, solar EPC entrants must hire the right mix of
personnel with the right skillsets in order to perform in a competitive market. Some of the mandatory
skillsets to be brought as part of the solar EPC team include the following:
Project management
Sales/marketing - this is often ignored, PLEASE DON’T. Get a dedicated marketing/sales
person
Engineering (electrical, PV design, civil)
As a small EPC, you could be tempted to outsource many key functions such as design and
marketing – DON’T! Without developing abilities in these, you are no better than a
middleman!
5.2 Insights on Marketing, Sales & Distribution
5.2.1 Shortening Long Sales Cycles
TABLE 9: SUGGESTIONS FOR SHORTENING SALES CYCLES
Challenge Recommendation
Confusion about the basics of rooftop solar, its
benefits and constraints
Confusion about subsidies and incentives and
government regulations
Owing to corporate bureaucracy and decision-
making
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Owing to negotiations and unrealistic cost
expectations
Prospect not fully ready
Owing to solar not providing a big enough
benefit
TAKEAWAY - Other generic recommendations to reduce sales cycles
Use the Power of Software - Use customer acquisition software that enable you to focus on
the right prospects (e.g.: Salesforce etc.). Ensure that you also use the analytics features of
these software in order to zoom on the right prospects.
Focus on the Right Niche – To a certain extent, sales cycles depend on the motivation to go
solar. For instance, a company wishing to put up a solar power plant based on a state or
central allocation has a clear deadline to meet, and hence will have to make the decision
fairly quickly. On the other hand, an industrial rooftop solar prospect for whom solar
provides marginal savings has no immediate pain point resolution or big benefit. Decision
making in such cases could take a long time. Choose your niche with care.
Develop an Eye for Elimination – In any sales activity, who you do not run after is more
important than who you run after, as time is money and time wasted running after the
wrong prospects is money down the drain. Even if you are not from a sales background, it is
critical for you to quickly develop a template using which you are able to identify those
prospects who seem attractive on the outside but have little chance of converting into a
customer. We recommend that not only do you develop such a template, but do also train
all your sales people on this template.
5.2.2 Sales & Marketing Partnerships
Networking works, and partnerships help sales – always. In this sub-section, Solar Mango suggests some
marketing partnership strategies that can be effectively used by EPCs.
5.2.3 Brand Building
One key recommendation from Solar Mango for those EPCs keen on the rooftop solar segment is to
build a brand. Except for a few large corporate brands, there is hardly any recognizable name in the
rooftop solar EPC segment. This is an opportunity for you.
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5.2.4 Insights on Competition
The three key needs for EPCs today are assistance in generating qualified sales leads, technical assistance
in specific expertise domains and optimized procurement of components.
5.3 Best of Breed Practices
Process-driven Approach
o Both customer acquisition and actual solar power plant implementation require
significant attention to detail.
o Such attention to intricate details is not possible without a well thought out and executed
process
Technology
o Having internal design expertise
o Tech expertise for select domains such as diesel-solar hybrids
o Tech partnerships with top tier component suppliers and solution firms
o Good acquaintance with solar trackers installation and maintenance
Component Selection and Logistics
Marketing & sales
Project Management
Post-project implementation
5.4 Opportunities for Innovation
We provide a key list of innovation possibilities for EPCs in the Indian content, and given the current
phase/status of the solar PV industry and current trends.
Technical Avenues for Innovation
o Trackers – use of trackers is picking up dramatically in India. So make sure you catch this
wave.
o Better SCADA and monitoring systems
o Use of latest design and estimation tools
Business model avenues
O&M avenues
Innovations in marketing/branding
Other innovation avenues
5.5 Identifying Profitable Niches
For a sunrise industry like solar, understandably, there are a number of profitable niches that can be
worked on by small and medium EPCs. Rather than compete with established players on mass
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opportunities (and winning very few or none of them and making low margins), it is a far better idea to
work on specific, attractive niches. While the sizes of these could be small compared to mass
opportunities, new and small EPCs could find it far easier to win projects and establish themselves in these
– such early success could help them in expanding their footprint to the mass market later on.
Technology Niches
Market Niches
5.6 Leveraging Technology
The four technologies that are changing the way companies do business are:
Social
Cloud
Analytics
Mobile
5.7 Parameters on Which Solar EPCs are Evaluated by Prospects
TABLE 10: PARAMETERS ON WHICH PROSPECTS EVALUATE SOLAR EPCS
Parameters Details
Year of inception How long ago was the EPC established?
Is the EPC company a new entrant?
Nature and Scale of Projects Ground-mounted or Rooftop?
Large-scale or small-scale?
Brief background of the key personnel
Designation
Area of Expertise
Major Achievements
Evaluation of Key strengths Company’s reputation
Expertise in implementing projects successfully
Extent of the implemented projects
Certifications and Awards received Awards received from government or reputed
private bodies
Software and Methodologies
Solutions utilized for implementation of solar plant such as capability of monitoring solution provider etc.
Methodology in terms of approach for asset management and design of plant
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Performance Guarantees
Guarantees provided
Assurance of performance guarantee in terms of the output and efficiency of the plant and its’ components
Execution time Delays expected with regard to availability of the
components
Risks and Liabilities they cover Insurance measures undertaken for risk aversion
Components covered and terms & conditions under the insurance agreement
Other Parameters/ questions
Has the EPC used trackers for any of their plants? (This could possibly give us an insight into how advanced they are in terms of technology)
Do they have repeat customers?
What part of EPC work do they sub-contract?
Would they allow site visit to one of their solar plants?
Apart from EPC works, what does the company offer in terms of solar power plant implementation? (For example, they could be manufacturers/dealers of modules, mounting structures, or any other component or equipment)
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6. Profiles & Case Studies
The best way for any new EPC to start and strategize is to look at the profiles and activities of
incumbent EPCs. This chapter provides profiles and inputs on a wide range of EPCs in India,
and also analyses their activities on key dimensions. Inputs are provided on the following:
Topics Covered
Profiles of Prominent Solar EPCs
Variations of EPCs
Key Mistakes to Avoid
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6.1 Profiles of the Prominent Solar EPCs in India
This section provides an overview of various solar EPCs active in India and their brief profiles with details
on the services they offer.
Please note that this is only a representative list wherein some prominent EPCs are classified based on:
Size of projects implemented
Regional Focus
Ground-Mounted or Rooftop
Other
TABLE 11: CLASSIFICATION OF EPCS
Size of Project Implemented
Large-Scale projects (>50 MW) Sterling & Wilson
Tata Power Solar
L&T Solar Limited
Medium Scale Projects (10-25 MW)
Small-scale Projects (<5 MW)
South India
Pan-India Operations
Ground-Mounted/Rooftop
Rooftop
Ground-Mounted
Vikram Solar
Key Highlights
Founded in – 2006 Entrepreneurs – H.K Chaudhary
Location– Kolkata (India)
Type– Manufacturing and EPC
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Key Activities/Solutions – Solar EPC Services, O&M, Panel Manufacturing
Success So Far – Vikram Solar has commissioned more than 50 MW of projects throughout India.
They have also installed the first floating Solar PV Plant in India and won the EPC World Award
2014
Website– www.vikramsolar.com
Vikram Solaris a part of Vikram Group of Industries. The group, with over 40 years of experience in
engineering manufacturing, initially entered the renewable energy sectors by manufacturing solar panels.
They manufactured mono-crystalline and multi-crystalline solar PV modules.
Being successful in this field, they were able to supply panels for several notable MW scale projects. They
expanded their services to provide a complete lifecycle of solar power solutions and developing, installing,
constructing solar power plants and operating and maintaining solar power plants. They also diversified
into providing IPP solutions.
The company’s strengths include strong R&D, global networking and investing in state of the art
equipment. They also collaborated with Ark Renewable Energy College in R&D to build the first floating
PV plant in India. Such innovation and their focus on having a global presence continue to drive the
company forward. Currently they have international offices in Germany, USA, South Africa, Uganda, Dubai
and Japan.
Takeaway – This is a classic example of a manufacturing company sighting an emerging business early
where it can use its manufacturing expertise, and moving quickly to build a leadership position. What has
been impressive about Vikram Solar has been the emphasis they brought to marketing and promoting
their brand, which has made it even easier for them to get into the top 10 in the country in the solar sector.
Sterling & Wilson
Key Highlights
Founded – 1927
Entrepreneurs –Started by the Dracula Family, Now part of ShapoorjiPallonji Group
Location – Kolkata (India)
Type– EPC, Electrical Contracting, Turnkey services for wide variety of Industries
Key Activities/Solutions– Solar EPC Services for PV and CSP, O&M
Success So Far – Sterling and Wilson is one of the oldest players in the Solar EPC sector in India
and has offices in India as well as several international offices. They have been bestowed with
several awards and also have been ranked as the top Solar EPC Company in India and globally
19th by IHS, a globally renowned consulting firm.
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Website – www.sterlingandwilson.com
Sterling & Wilson began its operations in1927 as Wilson Electric, and was formally established in 1971 as
a part of Shapoorji Pallonji Group. Initially they focused only on HV and LV Electrical Systems and built
their reputation by being associated with several prestigious projects. They later diversified into HVAC,
Electrical Systems, MEP (Mechanical electrical, plumbing) services, Diesel Generators, and finally ventured
into the solar sector in 2010, leveraging on their rich experience in the electrical sector.
Deliverables like design, engineering, project management, and implementation were the ingredients
they used for winning EPC Contracts. They initially faced challenges like stiff deadlines, logistically hostile
terrains, and availability of critical components. Domain expertise on Electricals/Civil systems backed by
strong execution and project management capabilities is what customers rely on, and were the prime
differentiators that helped Sterling and Wilson succeed.
Executing projects before deadlines, decades of experience, offices spread across the country and strong
employee base have increased the bankability of the projects done by this firm. Sterling and Wilson has
executed several projects in the last few years of varying project sizes between 1 MW to 25 MW, with a
cumulative of 300MW as of 2015.
Takeaway – Sterling & Wilson had been in the construction business for quite a while, and hence the entry
into the solar EPC sector is unsurprising. The key takeaway from Sterling & Wilson is the vertical focus they
have had and ensuring that EPC solutions were all that they attempted to do, without getting distracted
by other solar ecosystem opportunities – a good example of Doing One Thing and Doing It Well.
L&T Solar Limited
L&T Solar Limited is the subsidiary of India's largest construction services provider Larsen & Toubro Ltd
(L&T) and is involved in offering turnkey EPC solutions for utility scale power plants as well as small and
large rooftop systems. The company has contracted more than 200 MW of grid connected EPC projects,
both under the National Solar Mission and State-promoted schemes of Gujarat and Rajasthan. L&T has
set up a research and development center in Chennai, which serves as a test bed to validate the competing
technologies and solutions, in an effort to help their clients in deciding the right technology for their
projects. Sharp Solar is the technology partner for L&T.
Services
L&T Solar Limited provides end to end solution in setting up commercial and industrial captive power
plants for third parties. They undertake design, construction, operation and maintenance of grid-
connected and off-grid solar systems on ‘turnkey’ basis. L&T Solar also helps in raising finance for utility
scale projects with the help of their associate company L&T Infrastructure Finance Ltd.
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Address
L&T Solar Limited
L&T Infotech Park
Mount Poonamallee Road,
Manapakkam, Chennai 600 089
T +91 44 2252 9100
F +91 44 2252 3514
Email: [email protected]
http://www.lntecc.com
Takeaway - While their dominant focus is on large-scale ground-mounted solar, the company has also
done rooftop solar in selective cases. They have installed a 7.5 MW rooftop solar plant on the campus roof
of Radha Soami Satsang Beas (RSSB) (it was the world’s largest single rooftop solar power project, at the
time of installation (Jun 2014). They traditionally outsource EPC works all along the value chain to smaller
EPCs and sub-contractors.
6.2 Variations of EPCs
Broadly, the typical solar value chain is as shown below.
EPCs belong to the downstream part of the solar PV value chain. As the solar market was wide open and
up-for-grabs for early adopters, many solar companies tried to vertically integrate to become an EPC too.
The typical combinations in which we see EPCs operate in the market are as follows:
TABLE 12: EPCS AS OEMS & DEVELOPERS
EPC Combination Examples
Pure-play EPC
OEMEPC
Sub-component & Raw Materials
OEMs EPCsPower Plant Developers
Power Purchasers
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DeveloperEPC
OEMEPCDeveloper
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7. Solar Power Plant Reference
Details
This is a handy reference section providing you data and inputs on a comprehensive list of
solar power plant aspects. These data have been compiled by Solar Mango’s team over a long
period and through rigorous analyses, and hence are authentic.
Topics Covered
Land & Infrastructure Details
Estimating Generation from Your power
plant
Technical Features and Equipment for the
Solar Power Plant
Financial Analysis of Ground-mounted
Solar Power Plants
Financial Analysis of a Rooftop Power
Plant
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7.1 Land and Infrastructure Requirements for Setting up the Solar Power
Plant
7.1.1 Land Details – Area required, and other pre-requisites for the land
Land requirement for solar PV farms
Type of solar panels used
Whether the solar farm uses trackers technology
Land area required based on the type of panel
Solar panels are mainly of two types: Crystalline and thin film solar panels.
Crystalline solar panels are usually made from silicon, while thin film solar panels are made from
Cadmium Telluride (CdTe) or Copper-Indium-Gallium-Selenide (CIGS).
Broadly however, it can be said that solar PV farms with crystalline panels require about 4-5 acres
per MW, and those with thin film technologies will require about 6-7 acres per MW.
The area required per MW depends on the efficiency of the solar panels – higher the efficiency, lower the
area required.
Hence, with thin film panels increasing in efficiency, the per MW land area required for a solar farm with
thin film panels is getting closer to that required for crystalline panels.
With or without trackers
Trackers are technologies that track the location of the sun and orient the solar panels such that the
energy capture by the panels is maximized. While the use of trackers does increase the total output from
every MW, trackers also require additional space, and thus the area required per MW while using trackers
will be higher than otherwise.
Where are solar farms usually located?
Solar farms are usually put up in areas where real estate is cheap. As a result, you will find large solar
farms typically in the middle of barren regions and deserts. Only in select cases and for special reasons,
solar farms are put up close to cities or on costly real estate.
How much does land cost in areas where solar farms are put up?
As solar farms are located in low-cost real estate areas, the land cost per MW is usually very low. In places
such as India, you can get such land as cheap as Rs 3-5 lacs per acre. Taking an average of 5 acres per MW,
the total cost of land in these regions thus is just Rs 15-25 lacs. In India, the total project cost per MW is
about Rs 6 crores (as of Jul 2016); thus, cost of land is just about 3% of the total cost. In many other regions
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worldwide too, it has been found that the cost of land is in the range of 1-3% of the total cost of the
project.
7.1.2 Details will also be provided for what portion of land is required for what
purpose TABLE 13: PORTION OF LAND REQUIRED FOR WHAT PURPOSE
Purpose Land Area Required (sq. ft.) Percentage of total land area
Panels
Roads, pathways
Inverter Rooms
Offices/Quarters
Substation Area (transformer
bay, LT panels, HT panels)
Water Infrastructure (bore
wells, pumps etc.)
Others
Total
7.1.3 Instructions on how to evaluate your land
Selecting a suitable site is a crucial part of developing a viable solar PV project. In selecting a site, the aim
is to maximize output and minimize cost.
Some of the main constraints that need to be assessed include:
Solar resource – Global Horizontal Irradiation, DNI –Direct Normal Irradiance, annual and inter-
annual variation, impact of shading.
Local climate – flooding, high winds, snow and extreme temperatures
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Available area – area required for different module technologies, access requirements, pitch
angle and minimising inter-row shading. The land required for a 1 MW power plant setup is
around 4.5-5 acres for crystalline technology and around 6.5-7.5 acres for Thin-Film technology.
This is only a rough benchmark and may vary based on technology and efficiency of panels.
Land use/cost – this will impact land cost and environmental sensitivity. The impact of other land
users on the site should also be considered. Land for solar power plants is usually located far from
populated regions, low cost real estate, Rs3-5 Lakhs per acre. Depending on the location, this
could be slightly less or more.
Topography – flat or slightly south facing slopes are preferable for projects in the northern
hemisphere.
7.2 Estimating Generation from Your power plant
7.2.1 Step 1 E.g. If the CUF for your region is 18%, then generation from a 1 MW plant will be
Annual Generation (kWh) = CUF x Capacity (kW) x 24 x 365
= 18% x 1,000 x 24 x 365 = 15,76,800 kWh
CUF can be ascertained by studying the performance of other plants in the region from data periodically
published by MNRE.
7.2.2 Step 2
The calculation in Step 1 provides the generation for Year 1. As solar panels degrade slightly every year,
the generation reduces each year. The actual degradation may vary from manufacturer to manufacturer,
but 0.5% annual degradation can be used as a rule of thumb.
Period Year 1 Year 2 Year 3 Year 4 Year 5 …
Generation (kWh) 15,76,800 15,68,916 15,61,071 15,53,266 15,45,500 …
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7.2.3 Step 3
The generation in Step 2 should be adjusted for further losses, if any, before billable units can be
calculated. These losses are typically losses in transmitting power from the solar plant to the injection
point and will vary from site to site. The policy may also specify a formula for calculating losses to arrive
at units to be billed.
If the policy provides for metering of billable units at the site, we may not need to consider any such
losses.
7.3 Technical Features and Equipment for a Solar Power Plant
7.3.1 Overview of Solar Power Plant Technologies
Current Solar PV technology mainly comprises two types of solar cell technology: Crystalline Silicon and
Thin-Film
Crystalline Silicon – The value chain involves reducing sand to raw silicon followed by purification,
wafer cutting, doping, cleaning, and coating. This forms cells which are subsequently connected
and laminated to form a solar module (panel), which can then be assembled in arrays and
combined with electrical components to form a solar power system. Crystalline Silicon can be
further divided into
o Mono-crystalline
o Poly-crystalline
Thin-Film – The value chain is much shorter, as the modules are manufactured in one single step
from raw silicon and other compounds by depositing the photovoltaic material and other
chemicals on glass or transparent film. Thin-film itself comprises three different technologies
a-Si
CdTe
CIGS
7.3.2 Panels
Silicon Technologies
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FIGURE 4: CLASSIFICATION OF SILICON TECHNOLOGIES (SOURCE: SOLAR MANGO)
The silicon technologies available have been mentioned above.
PV cells can be characterized according to the long range structure of the semiconductor material, “mono-crystalline”, “multi-crystalline” (also known as “multi-crystalline”) or less ordered “amorphous” material. Crystalline Silicon (c-Si) – Modules are made from cells of either mono-crystalline or multi-crystalline silicon. Mono-crystalline silicon cells are generally the most efficient, but are also costlier than multi-crystalline. Thin Film – Modules are made with a thin-film deposition of a semiconductor onto a substrate. This class includes semiconductors made from:
Amorphous silicon (a-Si)
Cadmium telluride (CdTe)
Copper indium selenide (CIS)
Copper indium (gallium) di-selenide (CIGS)
Types of Technologies
Crystalline
Polycrystalline Monocrystalline
N-type mono P-type mono
Thin Film
Amorphous Silicon
CIGS/CIS CdTe
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7.3.3 Inverters
7.3.4 Mounting Structures
7.3.5 Trackers
7.3.6 DC-Side Electricals
7.3.7 AC Side Electricals Such as Transformers, Switchgear, Cables…
7.3.8 Other Balance of Systems Monitoring Systems
7.3.9 Details of Substation Required for Evacuation
7.3.10 Details of Load Flow Study Required for Your Solar Power Plant
7.3.11 Civil and Architectural Requirements
7.3.12 Component Selection – Standards and Warranties
TABLE 14: STANDARDS AND WARRANTIES FOR CRITICAL COMPONENTS
Equipment Standards(Applicable
IEC/Equipment BIS standard)
Warranty
PV Modules c-Si PV
Module
IEC 61215 Industry standard warranty is
5-year manufacturer’s
warranty
0-10 years for 90% of
the rated output
power
10-25 years for 80% of
the rated output
power
Nowadays, many module
manufacturers also offer linear
performance guarantee. It
typically comes with a
degradation of around 2.5% in
the first year and a linearly
decreasing performance
(about 0.7%) from then on.
Thin film PV
modules
IEC 61646
CPV modules
& assemblies
IEC 62108
IEC 61730 – 1
IEC 61730 – 2
IEC 61701
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Equipment Standards(Applicable
IEC/Equipment BIS standard)
Warranty
Power Conditioner Units
(PSUs)/(Inverter)
IEC 61683, IEC
600682(6,21,27,3,4,78)
Typically come with a 5 year
manufacturer warranty which
can be extended to 10 years
Mounting Structures Typically come with a 5 year
manufacturer warranty
Cables IEC 60189, IS 694/IS 1554,
IS/IEC 69947
Typically come with a 5 year
manufacturer warranty
Switches/Circuit
Breakers/Connectors
IS/IEC 60947 part I,II,III EN
50521
Typically come with a 5 year
manufacturer warranty
Junction Boxes/Enclosures IP 65 (for outdoor use)/IP 21
(for indoor use), IEC 62208
Typically come with a 5 year
manufacturer warranty
7.4 Financial Analysis of Ground-mounted Solar Power Plants
7.4.1 Case Study – Cash Flow for 1 MW Plant
7.4.1.1 Overview and Assumptions
In this case study, we have considered a sample 1 MW AC plant. Generation is estimated to be 18% CUF.
The developer can avail accelerated depreciation, and a low tariff of Rs. 5.5/kWh is considered. This cash
flow has been deliberately chosen to simulate a problematic cash flow projection.
This cash flow is a sample only based on a number of assumptions (provided below). We urge you to
calculate your returns with your Chartered Accountant and EPC. Please read the cash flow along with the
notes and analysis provided after the cash flow.
TABLE 15: CASH FLOW FOR A 1 MW PLANT
Details Value
Plant Capacity
Capacity Utilisation Factor
Annual Degradation (%)
Capital Cost
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O&M Cost
Annual Escalation (%)
Insurance (% of plant cost)
Annual Escalation (%)
Tariff
Tariff Escalation (%)
Inverter Lifetime
Financing
Debt
Equity
Interest
Loan Term
Depreciation
Tax rate
7.5 Financial Analysis of a Rooftop Power Plant
Returns are calculated by generating a 25-year cash flow (for the lifetime of the solar plant) that
incorporates all revenues and costs (for solar and the grid/diesel power that it is substituting). Based on
the cash flow projection we can calculate the IRR, payback period, and other financial metrics. We
recommend these calculations are performed by your Chartered Accountant/Financial Advisor based on
the inputs provided below.
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8. Glossary - Terms You Should
Know as a Solar EPC
Technical and Operational Terms
BOO Model (Build Own Operate Model)
Capacity Utilization Factor
Central Inverters
Concentrating Photovoltaics
Cross Subsidy Surcharge
Crystalline Silicon/c-Si
DNI (Direct Normal Irradiance)
Feed-in-Tariff
Grid-tied Solar Power System
Grid Parity
LCOE (Levelized Cost of Energy)
Module
Module Degradation
Net metering
Off-grid Solar
Open Access
Pyranometer
Reflection Losses in Solar Cells
Shading of solar panels
Smart Grid
String Inverters
Standard Test Conditions (STC)
Temperature Coefficient of Solar Panels
Thin Film Solar Cell
Tracker
Watt Peak (Wp)
Wheeling Charges
Explanation of Key Financial Terms
Payback Period
Return on Investment (ROI)
Net Present Value (NPV)
IRR (Internal Rate of Return)
Levelized tariff
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PPA
Financial Closure
Accelerated Depreciation
Discounting Factor
Hedging
Moratorium
With recourse/Without recourse
Solar Apex Bodies & Organizations in India and their Roles
MNRE
CWET/NIWE
SECI
SESI
NSEFI
SERIIUS
CSRI
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9. Annexure 9.1 Tax Break-up for a Typical MW-Scale, Ground-Mounted Plant
TABLE 16: TAX BREAK-UP FOR A TYPICAL SOLAR PV PROJECT
S. No.
Cost Details Tax type (as applicable)
1 Modules
Supply – Domestic
Supply – Imported
2 Inverter
Supply
3 Structures
Supply
Service
Civil Works
4 Civil Works
Supply
Service
Civil Works
5 Electrical
Supply
Service
6 Pooling Station (33/132 kV)
Supply
Service
Civil Works
7 Design & Engineering
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9.2 List of key component suppliers – for Panels, Inverters, Cables,
Mounting Structures, Monitoring Systems
9.2.1 Modules 1. Vikram Solar
2. Waaree Energies Ltd.
3. Tata BP solar India Ltd
4. Lanco Solar
5. Moser Baer Photovoltaic Ltd
6. XL Energy Ltd
7. Goldi Green
8. Emmvee Photovoltaics
9. Indosolar
10. HHV Solar
11. Solar Semiconductor
12. KotakUrja
13. Websol Energy Systems
9.2.2 Mounting Structures 1. Ganges Internationale
2. Nuevosol
3. PebsPennar
4. Tata Bluescope
5. First Solar (custom-designed for First Solar modules)
6. Vim Fab
9.2.3 Cables 1. Apar Industries Ltd
2. Cords Cable Industries
3. Havells India Ltd
4. KEI Industries Ltd
5. Lapp India
6. Polycab Wires Pvt. Ltd
7. Universal Cables Ltd
8. Ravin Cables
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9.2.4 Inverters
TABLE 17: LIST OF INVERTERS
V-Small kW Inverters (1-10 kW) Small-medium kW Inverters
(10-500 kW)
Large kW Inverters (>500 kW)
SMA Solar
Leonics
Fronius
Su-Kam
ABB
SMA Solar
Su-Kam
Kaco New Energy
Studer-innotec
Leonics
Schneider Electric
Refusol
Chint power Systems
Fronius
TMEIC
ABB
Delta
ABB
Bonfiglioli
Schneider Electric
SMA Solar
TMEIC
ABB
9.2.5 Battery 1. Aegan Batteries Limited
2. Amara Raja Batteries Limited
3. Artheon Electronics Ltd
4. Exide
5. GEM Batteries
6. Marathon Batteries
9.2.6 IT Solution Providers TABLE 18: LIST OF IT SOLUTION PROVIDERS
SCADA Monitoring Systems PV Design Software
iPLON
Wattmon
MachinePulse
DataGlen
PVsyst
PVSOL
PVComplete
Helioscope
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To purchase the India Solar EPC Blueprint,
Send an email to [email protected], with the subject: Purchase Solar EPC Blueprint
Or contact Ramya for further information – [email protected]
Visit the official website for more information - http://www.solarmango.com/blueprint-solar-epc-
opportunity-india/