1. www.indianpowersector.comPower Plus Consultants.
SOLAR
A brief comprehensive
handbook for developers
and investors to
maximize their returns.
How much can you
expect as returns from
your investment into
solar.
Choose the best alternative
Know your Policy
Know your Buisness Model
Know your Open Access state
Choose the best alternative
Know your Policy
Know your Buisness Model
Know your Open Access state
A brief comprehensive
handbook for developers
and investors to
maximize their returns.
How much can you
expect as returns from
your investment into
solar.

2. 2 Power Plus Counsultants
Why Solar Energy Make Sense in India
What is the difference between Indian solar PV market w.r.t solar markets in E.U and U.S.?
The answer is simple for E.U. and U.S. solar or renewable power is a green and safe alternate
option to Coal and Nuclear based production. However, for India it is utmost necessity for fueling
the sustainable growth.
Key Drivers
•Energy Deficit of 12% of peak demand
•If India continues to grow at an average
rate of 8% for the next 10 years, the
country's demand for power is likely to
soar to 315 to 335 GW by 2017 which
will require a generation capacity of
415 to 440 GW (Mckinsey Report)
•About 68.1% of India's energy
generation capacity is from fossil fuels
with coal accounting for 58% of India's
total energy consumption (Central
Electricity Authority)
•High dependence on imports for energy
requirement , total imports represents
13% of the total primary energy supply
( Energy Statistics Report 2013)
•Rising price of electricity based on coal
and gas
•Environmental concerns
How Solar Fits in
•High Solar Irradiation (annual average
GHI of 5.1) in most of the parts of
country
•Large number of sunny days available
(apprx. 330 )
•Availability of large area of land at
comparatively low costs
•High solar potential near main load
areas in country (Western and
Southern India)
•Support from Government under
NAPCC and Renewable Purchase
Obligation (RPOs)
•In parity with other resources of energy
generation with costs still going down
•Can be used both for centralised power
generation capacity addition as well as
off grid for decentralised use of energy
Choose your Policy Right

3. 3Power Plus Counsultants

4. 4 Power Plus Counsultants
Choose your Model: Business Models for Solar Plants
APPC + REC
•The power generated is sold to the discom at APPC.
•The tariffs offered by various discoms are relatively low and thus the viability of the project
largely depends on the revenue generated through REC sale.
Captive model
•The power is sold to the off-taker through a captive route.
•It is a win-win proposition for both the parties as both can achieve significant profits by this
type of collaboration.
Third party sale through open access
•A lucrative market in states where industrial tariffs are in the range of INR 5 – 5.50.
•The financial strength of the off-taker makes the PPA credible.
•Open access clearances are a hurdle, as discoms do not wish to let go their high paying
consumers easily
Bidding in state policies/ NSM
•The biddings are crashing as new or strategic developers bid aggressively.
•The PPAs are however one of the most bankable.
•Also a lot of capital and time is invested in the bidding process.
Choose your Open Access state: Comparing the returns as per existing industrial tariffs
Source: PPC financial model
Average Capex for Open Access Project: INR 80-85 million
13.07%
16.67%
21.26%
27.06%
34.24%
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
30.00%
35.00%
40.00%
90 Mn 85 Mn 80 Mn 75 Mn 70 Mn
EquityIRR
CAPEX in Million INR
Most conducive state for
Open Access projects. 5 MW
project by Emvee already
instsalled
Andhra Pradesh :
The Upcoming “Solar Capital of the India”
flying high with promising returns

5. 5Power Plus Counsultants
Source: PPC financial model
Average Capex for Open Access Project: INR 80-85 million
6.47%
8.84%
11.85%
15.76%
21.02%
27.98%
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
30.00%
90 Mn 85 Mn 80 Mn 75 Mn 70 Mn 65 Mn
EquityIRR
CAPEX in Million INR
NPV become > 0 at
CAPEX 0f INR 79
Million for Rajasthan
Rajasthan :
The leading state for JNNSM – Investor
Attractiveness slips to third position due to
low industrial tariffs.
9.57%
12.53%
16.32%
21.22%
27.56%
35.50%
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
30.00%
35.00%
40.00%
90 Mn 85 Mn 80 Mn 75 Mn 70 Mn 65 Mn
EquityIRR
CAPEX in Million INR
NPV become > 0 at
CAPEX 0f INR 85
Million for
Maharashtra
Maharashtra :
Industrial capital comes in second: Though
Open Access clearances still a bottleneck
Source: PPC financial model
Average Capex for Open Access Project: INR 80-85 million
The above states have their own pros and cons and will require in detail analysis for their viability
and priority for a particular project developers. For more information on the techno-commercial
viability and future of Indian Solar market contact us at info@indianpowersector.com.

6. 6 Power Plus Counsultants
Captive Model : A win – win situation for all the stake holders involved
14.80%
18.47%
22.77%
27.83%
33.81%
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
30.00%
35.00%
90 Mn 85 Mn 80 Mn 75 Mn 70 Mn
EquityIRR
CAPEX in Million INR
Source: PPC financial model
Highly Recommended
• Captive model
• Third Party Open Access sale with highly bankable PPAs
Viable Options
• Projects under state policies through competitive bidding or through direct
allocation
Opportunistic Market
• NSM through Viability Gap Funding
• APPC + REC

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