Hi Friends,

Even as I launch this today ( my 80th Birthday ), I realize that there is yet so much to say and do. There is just no time to look back, no time to wonder,"Will anyone read these pages?"

With regards,
Hemen Parekh
27 June 2013

Now as I approach my 90th birthday ( 27 June 2023 ) , I invite you to visit my Digital Avatar ( www.hemenparekh.ai ) – and continue chatting with me , even when I am no more here physically

Monday 2 January 2017

Sun : Our Soul ( A New SOS )



In 1952 , I read " The Birth and Death of Sun " , written by George Gamow


Being rather poor in " Differential Equations " of Intermediate Science , I found it extremely grasp-able , since there were no mathematical formulae in that book


In this treatise , Gamow predicted that the Sun will burn out its hydrogen fuel in 4 billion years , and die a cold death !


I doubt whether the book said :


" One hour of Sunshine falling on our Earth can generate enough electricity to power the Earth for one full year "


May be because Solar panels were yet to be invented by 1952


But scientists have calculated this by now


If you extrapolate this backwards :


One hour of Sunshine falling on India's land area of 3,000,000 square kilometers , can generate enough electricity to power our nation for ONE year !


Now , most of India gets 6 hours of Sunshine daily for some 300 days in a year !


So , as a nation , we get 1800 hours of Sunshine , every year


If we were to cover our entire land area ( of 3,000,000 sq km ) with Solar Panels , we could get enough electricity in one year ( ie: in 1800 hours ) , which will meet our power needs for 1800 YEARS ! ( about 5000 trillion Kwh ! )


But , at the most , we need to store the Solar power for a few days only ( even if Sun does not come out for a couple of days ) . Certainly not for 1800 years !


So , there is no need to cover up our entire land mass with Solar Panels


A very small fraction need be covered . Say, all roof tops in India ?


Why install small solar power plants on roof tops ?


Simple :


With roof-top based solar plants , we don't need to distribute power over long distances , using nation-wide distribution network. We produce / store / consume power in same place


So no transmission costs / losses / thefts !


There are no " intermediaries " between producers and consumers ( eg: DISCOMS )


No need of elaborate " metering / billing / accounting "


No need for PPA ( Power Purchase Agreements ) between producers and DISCOMs


A roof top solar installation can be done in a matter of hours, providing employment to lakhs of Installation Technicians, employed by thousands of MSME engaged in such work


Many more lakhs will find jobs in companies engaged in manufacture of allied electrical /  electronic / storage batteries etc


So enormous " Job Generation " as a by-product


These local MSME manufacturers / installers , will aggressively compete and provide quick / efficient , after-sales service


Of course , roof top solar power's Capital Cost per kwh is higher than same for large land based installations . Over the next couple of years, this will even out


But as I mentioned in my earlier blog :


COST OF FUEL ( Sun ) is  ZERO


*  COST OF MAINTENANCE , too , is nearly  NIL


Practically , the only cost of a roof top based solar plant is " INTEREST ON CAPITAL "


Now NDA government has announced a Capital Subsidy of 30 % on " Competitively Discovered Price " for roof top installations and made an allocation of ( approx ) , Rs 5200 crores ( $ 750 million ), for putting up 4200 MW


But , on the balance 70 % of Capital Cost , users will need to borrow money from banks at 10 % - 15 % interest and go through a lengthy approval process and hypothecate the assets


And ensure timely repayment of EMI in order, not to get their plants " repossessed " !


But imagine following scenario :


Government declares units belonging to " Solar Power ( Panel Mfr / Power Production &
    Distribution / Ancillary Mfr  ) " as    a "  SOS " industry


*   Units will need to register as such with Department of Company Affairs ( DIPP )


*  Units will be exempt  from paying Corporate Income Tax for 10 years , on whatever
   income they earn ( only those starting operations latest by 31 March 2018 )


 *  No questions will be asked as to the " source " of funds invested in the shares of such
   units ( a kind of Temporary Amnesty Scheme - 01 April 2017  till 31 March 2018 - to
   channelize BLACK MONEY into creation of PRODUCTIVE  / NON-POLUTING assets )


 *  Units cannot engage in any other Industrial / Commercial / Financial activities

 
 *  Units cannot declare any dividends to share-holders for 10 years


These are just broad outlines and details need to be worked out


If there is political courage to pull off such an initiative , government will NOT need to allocate ANY AMOUNT !


NO NEED TO SUBSIDIZE THESE UNITS OR THE USERS , WITH THE TAX PAYERS' MONEY !


Instead of that $ 750 million allocation ( from tax payers' money ) , Black Money holders will readily pump in $ 750 BILLION into the SOLAR INDUSTRY ( enough for additional installed capacity of 750 GW - as against our current installed capacity 8.63 GW of solar , and a target of 100 GW , by 2022 ! )


Remember , how , only a few months back , tiny Indonesia managed to collect $ 300 billion of its Black Money , by levying tax ( no penalty ) of just 4 % !


And with this kind of  INCENTIVE WINDOW ( to convert BLACK into WHITE ) , expect


*  Hundreds of SOS Units to spring up before 31 March 2018


*  They will have ZERO cost as far as servicing of EQUITY is concerned ! No dividends !


*  They will not need to borrow funds from banks and pay interest ( no danger of NPA ! )


*  They will say : We are not in the business of " manufacturing of panels " but we are in
    the business of " Delivering electric power to homes / businesses "


  (  I am reminded what my one time boss, Helge Hansen  told me :

    " Hemen , we are not in the business of manufacturing Diamond Drilling Bits : We are in
     the business of selling Industrial Diamonds " )


*  They will compete with each other fiercely and ( as it is already happening in USA ) ,
   start offering roof top installations, absolutely FREE, and selling the generated power at
   20 paise/Kwh, for 10 year purchase agreement and with a 5 % tariff reduction per year !


   We can look forward to witnessing similar competition among large , land-based ,  solar
   power installations which will be the main suppliers to large commercial establishments /
   industrial factories / infrastructure projects / Electric Vehicle Charging stations , etc

  
Just imagine


*   how much, our LOW ENERGY COST ECONOMY can make us , INTERNATIONALLY
    COMPETITIVE !


*  the rise in GDP !


*  the possibility of being able to export our surplus power to neighbouring countries


*  Being able to replace 6 million petrol / diesel vehicles with EVs by 2020 , due to
   easily available charging stations on every street corner


*  Reduction in pollution by shutting down of hundreds of existing fossil fuel based power
    plants , whose utilization will drop below 10 % by 2022 ( as against National Electricity
    Plan expectation of 48 % , and a un-viability threshold of 55 % )


I hope my suggestion will be supported by Shri Piyush Goyal ( Minister for Energy ) , who referring to " innovative financing such as reverse bidding for projects as a smart way of saving public money " , said :


" By adopting such principles, I have been able to reignite the power and coal sector "

( Source : Business Line / 19 Dec 2016 )


Dear Piyushbhai :


By " harnessing  GREED  to harness  SUN  " , we could achieve 100 GW of Solar by 2019 , instead of government target of 2022


I hope you succeed in persuading Arunbhai , to incorporate this proposal in his forthcoming budget speech on 01 Feb 2017


Unless , Narendrabhai decides to announce this as a Republic Day gift to the Nation !

--------------------------------------------------------------------------------------------------
03  Jan  2017

www.hemenparekh.in / blogs