Earlier this month, Coal India, known as the world’s largest coal company, made a surprising statement when the firm declared it would invest in the installation of solar PV panels in an attempt to reduce energy bills and cut costs. Coal India, which produces more than 80 percent of Indian’s coal is planning to build a 2 megawatt solar plant which will have the potential to supply excess electricity to the grid. This is a remarkable statement as the large firm is not only turning to solar energy as an efficient business practice, it understands India cannot power itself by coal.
However, Coal India is not the only firm who is looking at renewable sources to cut costs, other large firms are following their footsteps. Companies that are already using solar energy include Maruti Suzuki, the country’s biggest car maker and the local branches of Dell and IBM. Neyvili Corp, another state owned coal company and Oil India, are considering the use of renewable energy. Neyvili, for instance, has proposed to build a 10MW solar PV plant with an option to upgrade to a 25MW facility.
Tata Group, an Indian multinational conglomerate company, is heading a thriving solar business. Ajay Goel, the head of Tata Power Solar Systems, stated that solar installations represents a market of around 80 billion rupees ($1.4 billion). Goel said that many of the biggest companies in the country are turning to solar because it is cheaper than energy coming from the grid.
According to the US Energy and Information Administration (EIA) 57 per cent of India’s electric power capacity comes from coal. Though India has the fifth-largest reserves in the world, the country consumes a large amount of coal from foreign countries such as Australia, Indonesia and South Africa reaching a record high of 135 million tonnes in 2012. Nonetheless, with such a high supply of coal, India’s carbon tax, meant to aid solar power development, does affect the price significantly. According to the Indian government, solar power could be cheaper than coal by next year.