Solar Power: Another Opportunity for US-India Cooperation

Over the weekend, in his Independence Day speech, Indian Prime Minister Manmohan Singh, again highlighted India's commitment to promoting solar energy.  Prime Minister Singh's call to invest in clean energy follows the Indian government's recent approval of an ambitious new plan to increase solar power capacity to 20 gigawatts by 2020, the National Solar Mission.  The Mission is a comprehensive $19 billion plan that will provide lighting for 20 million homes and eliminate 42 million tons of carbon dioxide emissions annually - equivalent to taking 8.75 million US passenger cars off the road. 

The Solar Mission has several innovative measures built into it.  For example, the Mission plans to create a $1.1 billion government fund to jumpstart the project and to tax fossil fuels and the power generated by them to build up the fund.  There are also several financial incentives to build solar projects including a 10-year tax holiday, priority bank loans, and grid connections which would allow producers to sell excess energy to utilities.     

The National Solar Mission could make India a global leader in solar energy.  Currently, India has only 5 MW of installed solar capacity.  The Mission's 20 GW increase would be equivalent to an impressive 1/8th (or 12.5%) of India's currently installed power base.  By comparison, in 2007, California, the biggest producer of solar energy in the United States, had only 404 MW of solar power capacity, or 0.6% of the state's total power capacity.  Unsurprisingly, some are skeptical of India's ability to make the jump from 5 MW to 20 GW in only eleven years, especially when India's ten solar panel manufacturers have only 80 MW of solar panel production capacity among them.  

The current limitation in India's solar panel production capacity is another prime opportunity for increased US-India cooperation.  Nations such as Germany, Japan and the United States are world leaders in solar power technology.  And, India is seeking the help of developed nations on its path towards a clean energy future.   Some US-India collaborative efforts have already starting to take off.  This week, New Jersey-based ZebaSolar was chosen to participate in India's first major allocation of solar farms in Gujarat.  The project involves a 743 MW award of solar concessions - one of the largest allocations in the world to date by any government.

Unfortunately, opportunities for cooperation are often overshadowed by headlines of conflict between India and developed nations during climate talks.  My colleague Jacob Scherr wrote about the contentious headlines in the media during Secretary Clinton's visit to India, and headlines of the recent Bonn climate talks are unfortunately no different.

Despite these hyperbolic reports of India's rejection of an emissions cap and the developed nations' insistence for a cap, India's Solar Mission shows that India is actually capitalizing on renewable energy.  India has immense renewable energy potential that global businesses are quickly recognizing.  India will host the next International Renewable Energy Conference in October 2010 with thousands of entrepreneurs and technical experts expected to attend.  Another example of the spread of solar energy in India is Lighting a Billion Lives, a nation-wide campaign by The Energy and Resources Institute (TERI) to provide solar lanterns to rural communities where kerosene is the main fuel source.  So while the path to agreement in these climate talks may be long, it's important to focus on the progress that's being made and the potential for cooperation as we make our way towards Copenhagen.  A commitment to cooperation will serve both nations well in terms of creating clean energy jobs and curbing global warming emissions. 

Co-authored by Kimi Narita (NRDC Legal Intern) and Seth Silverman (MAP Fellow)