Clean energy is one of the biggest drivers of growth in India, but many are struggling to get off the ground.
So how do you go from idea to business?
We spoke to three entrepreneurs to learn how to start a clean energy business, how to sell electricity and the key challenges facing India’s clean energy sector.
First, a word on the term clean energy: The term clean means that there is no coal, oil or gas.
This means that the energy you generate does not use fossil fuels.
However, India’s energy mix is heavily dependent on coal, and this is one way in which India has failed to tackle its environmental problems.
India’s power sector is also heavily reliant on coal and its emissions are among the highest in the world.
To put this in context, India emits almost half the CO2 emissions of the United States, which accounts for almost half of global emissions.
India also produces over half the coal that is used in the US and Europe.
This is one reason why India’s economy is so reliant on the use of coal.
India has not been able to overcome the climate crisis as it has done in the past, says Abhishek Choudhary, founder of Clean India.
India has been trying to do that in different ways and has done so in the context of climate change, but the Indian government has failed.
“The Indian government’s focus is on energy and it is not really on the environment, it is about power generation,” says Choudo.
Choudos organisation Clean India is a new initiative which seeks to build clean energy businesses in the country, with a focus on power generation.
“We are the first ones to be able to start clean energy companies in India,” says the entrepreneur.
Clean India has raised funds from some of the most well-known investors including Sequoia Capital, Sequoias Technology Ventures and KPMG India.
Its goal is to bring together 500 clean energy entrepreneurs across India, with 50 more to follow.
To start the business, a clean tech startup needs a set of financial terms and conditions that can be signed by a third party.
The startup is then able to invest up to a certain amount of capital.
“The idea is to create a model whereby an investor can buy shares in a company, and the company can then sell those shares,” says Abhiyan Kulkarni, co-founder of CleanIndia.
The company says it is looking to raise about $30 million to fund its operations.
Kulkarnis company aims to create clean energy startups in India.
“We are trying to create startups that are clean, sustainable, and that are ready to go,” he says.
The firm hopes to have 100 to 200 companies operational in the next six months.
“I think we are in the early stages,” he adds.
India needs clean energy to reduce carbon emissions and create jobs.
It is also crucial to address the country’s air pollution problem, as India is one the largest polluters in the region.
The country is ranked 142 out of 179 countries in terms of air quality.
India currently has around 4,000 clean energy units, and is aiming to double this by 2022, as it aims to have 1.5 million units by then.
The sector is still a relatively new one in India with a total of around 2,000 units.
But there are signs of growing interest in the sector.
“Over the past three years, we have seen many companies opening up.
In January 2017, the state of Gujarat had a huge green energy project that started in July of last year,” says Ravi Chavan, CEO of Clean Solar Energy India.
Clean Solar has been launching solar projects in Gujarat and other states.
The state government has invested $30.5m in clean energy projects in 2017 alone.
Chavan says this investment has helped clean up the country and has also helped the economy grow.
“Solar power projects have created more than 4,100 new jobs,” he added.
In contrast to the coal sector, the country has been a big supporter of wind power, with more than 60,000 MW of this technology being installed across the country in 2017.
The industry has grown significantly, with some projects being installed at a cost of more than $US1 million.
In 2017, India installed over 1.3 GW of wind energy.
Chavan says India is currently one of only two countries in the developed world where solar power is more than 50% of total energy use.
“India has the largest solar power market in the entire world, and its a very attractive opportunity for us,” he said.
Chavans team hopes to make India one of India’s major renewable energy hubs by 2020.
“In 2019, the government announced a plan to double the capacity of solar power plants by 2020, and India is already one of two countries where more than one-third of the electricity needs are met by solar,” he states.