After
pledges early last month by India’s Minister of State for Power, Coal and New
and Renewable Energy, Piyush Goyal, who pledged to forge India into a
“renewable superpower,” momentum has increasingly picked up to follow the
example already set in northeastern states (like Jammu & Kashmir) and
especially eastern states (like Nagaland, on the Nepalese border), which
currently boast more than half their installed electrical capacity as coming
from renewables. This pledge follows up on earlier policy initiatives, like the
Indian government’s early 2014 MOU, signed by the Indian ministries, as well as
six key public-sector companies, to build a 4 GW solar farm, the largest on
earth, near Jaipur, Rajasthan (north-central India). This project would tap
into the country’s estimated 750 GW (Ministry of New & Renewable Energy, or
MNRE) of solar potential, via a project that would be roughly ten times the
size of any other solar project on the planet.
Hydro
has also been a key vector and part of the Indian government’s $11B fund to
shore up their ambitious goals to both serve electricity to a burgeoning
population and increase renewable percentage of the overall installed capacity
mix. From renovation and modernization of existing hydro capacity (as well as
some thermal), to small-hydro installations aimed at rural locations or to
support the overloaded national electrical grid, India has been moving hard to
tap their massively underexploited hydro potential. The keynote emphasis on
small-hydro executions, which have a lower environmental impact and are ideal
for smaller communities, has been a consistent theme.
The
rapid rate of both industrialization and urbanization in India, combined with a
growing middle class, where rising per capita income is driving per capita
electricity consumption at around a 5% CAGR over the past decade, paints a very
bullish picture for long-term energy demand according to the Central
Electricity Authority (CEA). The Planning Commissions Working Group on Power
has even stipulated forward guidance of around an additional 76k MW of
installed capacity in their 12th Plan (2016 to 2017), which is set to rise
thereafter to 93k MW for their 13th Plan.
Poor
quality of existing infrastructure, requiring electrical grid modernization, is
a major driving force here. Both for overall spending and for a growing trend
towards distributed capacity, where solutions like small-hydro and localized
solar farms are seen as key to offsetting macroscopic grid vulnerabilities like
those made clear to all during the 2012 blackouts that left 600M-plus without
power for days. This is a heavy load to lift considering data points like peak
electrical demand hitting 298GW by 2021 to 2022, according to CEA’s 17th
Electric Power Survey of India. Shoring up the grid’s vulnerabilities while
building up so much capacity is no modest goal for a country that already has
the fifth largest generation capacity on earth, with around 4% of global
generation capacity according to the Ministry of Power.
This
is a target-rich environment for operators like Pan Global, Corp. (OTCQB:
PGLO), whose mission, via their wholly-owned subsidiary, Pan Asia Infratech,
Corp., is focused on building out global green energy capacity (as well as
sustainable agriculture), with a particular emphasis on small-hydro and solar
PV (photovoltaic) projects in India. The grid connection back in July this year
of their 5.7MW small-hydro plant up in Uttarakhand, known as Project Badyar, is
a prime example of the kinds of projects they are engaged in, and the staggered
acquisition of the privately-held Indian corporation that commissioned the
plant is a clear example of how judicious the company’s overall strategic
approach is to the Indian market.
Rajasthan,
with a landscape dominated by vast tracts of wastelands, most clearly seen in
the sprawling 77k square mile Thar Desert, is a natural target for various
forms of solar power projects, with PV being the easiest to execute, as even
large farms can be set up in a bite-sized fashion. India’s MNRE has already approached
the World Bank for $500M to help kick off the first 750 MW of their massive
aforementioned 4 GW solar project near Sambhar Salt Lake in Rajasthan – and it
now seems strikingly clear to most investors that the fuse is lit for an
explosion of renewable build up in India.
Pan
Global can read the proverbial tea leaves here and is moving to get out ahead
of the solar curve with the development launch back in June of their Pan Solar
Marketplace, a solar installation and services ecommerce marketplace website
for India. The Pan Solar Marketplace’s initial focus on rooftop solar systems
will be followed up by a shift to other services and the gigantic ground-based
solar installation market that is forming.
In
the country’s east and northeast, where there is abundant untapped hydro
potential and many small rural villages, PGLO has a ready-made market with
tremendous roll up potential over the coming years and the company is currently
continuing to hammer out the due diligence on more acquisitions like Project
Badyar.
For
more information on Pan Global, visit: www.PanGlobalCorp.com
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