The Indian government has consistently been pursuing its goal to boost the country’s installed renewable energy generating capacity where solar power is at a dominant place. The change has been led by the Solar Energy Corporation of India (SECI). Formerly known as the Solar Energy Corporation of India, it was incorporated in the year 2011 under the Ministry of New and Renewable Energy; and it plays a key role in India’s vision to go solar.
From its inception, SECI's mandate was clear: to support the process of adoption of the National Solar Mission and build a green future of India. Thus, SECI in its initial stages has played a crucial role although it has been distributing a relatively small generation capacity in the initial years itself at 750 MW (0.75 GW) by 2014-15. This was the start of a steep trajectory that has been further propelled by India’s demand of energy and its climate change obligations.
Currently, SECI manages 65.3 GW of awarded capacity with more than 60 percent or 40 GW of the capacity to be in the solar segment. This growth shows that SECI is all the more important in India’s RE sector that was turned into the nodal agency for RE projects. The fact that the SECI has highest trading license in the sector brought out the firm as central to India’s green energy plan.
In practice, SECI’s operational model is to support renewable energy projects through tenders and PPA transactions. This makes the business environments transparent and competitive and hence receiving massive investors both locally and globally. SECI’s endeavours demonstrate that over the past one year approximately 43,000 million units of renewable energy have been traded.
The Adani Bribery Bombshell
It is pertinent to appreciate the performance of SECI, yet there are recent vices which surround the organization. The allegations have been filed by the U.S. Justice Department, and they relate to more than $250 million of bribes over state deals for a 15 GW solar project awarded in 2019. Committing itself to generate up to 12 GW of power through this solar project and starting with a manufacturing capacity of 3 GW of solar panels, the southern Indian conglomerate Adani Group won this bid.
Key Figures and Implications
The allegations committed important members and leadership in the Adani Group of companies, such as Gautam Adani and Sagar Adani. The allegations could not be said to be innocuous to both SECI and the Adani Group because they raise critical issues about the bidding system and the credibility of large-scale RE projects.
Denial and Defense
In respect of these allegations both the SECI and the Adani Group have flatly denied any impropriety. SECI had described some of its processes as transparent, competitive and most efficient in an organization’s structure of governance. While the Adani Group has laid down its stand claiming that is an ethical group and follows all regulatory norms.
Effect on India’s Renewable Energy Industry
It is regrettable for India’s SECI that the bribery allegations have paid a huge amount of attention to the company and its position in the Indian renewable market. Though these changes may create suspicion with regards to incidence of corruption and malfeasance these emphasize the need for sound regulatory mechanisms and efficiency in processes.
The Way Forward
Addressing the challenges posed by these allegations requires a multi-faceted approach:
Strengthening Oversight and Transparency:
- Extending and strengthening measures that will curb corrupt practices in bidding and awarding of contracts.
- Internal and external assessments and reviews of SECI’s projects can also be effective deterrent measures against wrong doings.
Enhancing Regulatory Frameworks:
- Reforms of the regulatory regimes of renewable power investment to avoid the risk of possible corruption in this highly sensitive area.
- It is imperative to guarantee that every of the stakeholder’s stringent compound the regulation of governing and ethic vices.
Promoting Ethical Business Practices:
- Promoting use of proper compliance programs, which have strong focus on ethics in corporate operations among companies.
- Offering consulting material which would educate firms and their employees about industry standards and compliance.
Fostering Public-Private Collaboration:
- Increased partnership between the public organization and other actors in the private realm to encourage the development of new solutions as well as growth of the renewable energy industry.
- Cultivating open forums for positive conversations and good information purposes in relation to issues and possible solutions.
Maintaining Investor Confidence:
- To make sure that any emerging claims of corrupt practices are addressed appropriately hence boost investors’ confidence in the sector.
- Informing the stakeholders openly about the steps which are being taken to avoid difficulties and keep the purity level of the specific sector.
Solar Energy Corporation of India (SECI)
SECI has been leading one of India’s most ambitious projects towards a green and sustainable power generation, in partnership with renewable energy. SECI was incorporated in 2011 with the operational support from the Ministry of New and Renewable Energy (MNRE) and its main objective has been to carry forward the objectives of the National Solar Mission, which plans to achieve significant enhancement in the solar power generation in India.
Establishment and Mission
SECI was recognized as a public sector undertaking (PSU) to facilitate the implementation of solar energy solutions in the Country. But its major goals are to spearhead the deployment of solar projects at utility scale, and navigate the use of solar energy by getting utilities to either competitively bid for solar projects or by coming up with policies that support solar procurement or even by offering financial enhancers.
Growth Trajectory
Since its creating, the organization has experienced growth. In the early phase, the corporation concentrated on preparing the Indian solar strategy via the establishment of a pilot and beginning some capacity building exercises. By 2014-15, SECI had financed 750MW generation capacity for the beginning of the corporate journey of SECI in renewable energy sector.
At the moment, SECI is managing a vast 65.3 GW awarded capacity that more than 60% is about solar power. The latter figure indicates a tremendous growth and ratifies SECI as a key player in India’s renewable energy game plan which makes it very important in the country’s fight against climate change and carbonization.
Key Initiatives and Projects
Under the SECI mechanism, several renewable energy projects have been sponsored in different parts of the country. Its initiatives include:
- Competitive Bidding: Through competitive bidding SECI provides solar projects to developers for implementation. This transparent and competitive strategy guarantees that projects are implemented on merit and competitive price to cause under-tariff and improved performance on the act.
- Solar Parks: SECI has-role for solar parks which consist of more than one solar projects, hence reasonable hurdles and cost related to land acquisition and infrastructure for projects. These solar parks have taken a huge role in the expansion of common solar projects in the country.
- Vibrant Financing Models: In its effort to ensure the right level of financing for solar projects, SECI has adopted several tailored funding structures such as Viability Gap Funding (VGF) and low cost funds. These models have made it easy for developer to fund various solar energy projects.
- Rooftop Solar Initiatives: SECI has also claimed in rooftop solar and especially in the urban sector. The Rooftop Solar Scheme has an intention to induce consumers of residential, commercial, and industrial sectors for the utilization of solar power instead of centralized electric energy to decentralize the energy production process and avoid extra transmission loss incidents.
Effect on the Wildlife and Natural Resources
The work of SECI has produced sound positive environmental and economic results. SECI has been instrumental in the generation of solar energy thus bringing down the Green House emission by a larger margin in India’s energy mix. The tapping of solar energy has also reduced the utilization of the fossil energy hence has brought energy security in the energy sector.
The Solar power system has brought job opportunities undertaking purposes such as development of the project, installation, maintenance among others and research. Solar energy projects have also encouraged technological developments and a lot of dollar investment from home and abroad.
Emergent issues and future prospects
Just like every other organization, SECI has not been devoid of some few complications in its operations. The challenges that related are land acquisition problems, challenges in integrating the solar power into the utility grid, and problems that arise from the fact that solar energy is an intermittent source of power. Also, important is the challenge of achieving the correct pace of expanding the solar capacity and keeping the stability of the grid.
In future, the identified strategy of SECI is to spread over other types of renewable energy projects such as wind and hybrid systems. It also planning its presence in two segments, offshore wind energy and green hydrogen, both of which are a promising future for India’s energy sector.
Central Public Sector Undertaking (CPSU)
CPSUs are an important part of the economic fabric in India. These are dominated by the state and in which the central government ordinarily retains the largest shareholding. Sections of industry, self-employment generation, and establishing stability and sustainability of the nation’s economy are mainly linked with them. In this part let us explore in details the role, functions and issues confronted by CPSUs in India.
Historical Background
The idea of forming CPSUs emerged in the period after India’s independence with the aim of advancement complete industrialization and economic development. The government set up these enterprises to create the precondition for the basic industries, encourage the regional development, and assure the rational allocation of resources. The most important theoretical basis was to lessen the degree of reliance upon external sources of supply and increase the level of sustainability in terms of multiple sectors in the given country.
Significance of CPSUs
- Economic Contribution: The CPSUs are an important source of contribution to the Indian Gross Domestic Product [GDP]. They work across the scale of energy, mining, heavy engineering, infrastructures as well as telecommunication and remit considerable revenues to the government annually.
- Employment Generation: CPSUs offer paid work to millions of people at various skill levels in the country making them important for employment. Organizations are integral to creating employment to cut on unemployment.
- Infrastructure Development: CPSUs have been in a position to take up, and implement, infrastructural projects of considerable significance including roads, railways, airport, and power projects. In as much as they have invested a lot by developing and sustaining infrastructure they have played a crucial role in the development of economic infrastructure and networks.
- Technological Advancements: Most CPSUs undertake R&D to improve the technological features of power systems and develop innovative solutions. This focus assists in enhancing effectiveness in operations, decreasing costs and staying competitive on the international market.
Key Functions of CPSUs
- Resource Management: CPSUs are also involved in the management and optimum utilisation of natural resources like coal and oil and natural gas and minerals. They guarantee the acceptable mining and refining of these assets to provide the country’s power and manufacturing requirements.
- Production and Manufacturing: Such enterprises are engaged in the production and manufacturing of variety of products and services including steel and capital equipments, telecommunication services and transport facilities. They provide an assured availability of necessary commodities and services for several areas in the economy.
- Service Delivery: CPSUs also offer common usage services in generation of electricity, Banking and Financial services, telecommunication and transport services. Their service delivery is more reliable and compulsory to any functioning of the economy.
Challenges Faced by CPSUs
- Operational Inefficiencies: It is common for CPSUs to face multiple challenges that pertain to its efficiency problems, including the issue of out-dated technology and tools, delays due to bureaucratic procedures, lack of timely resource optimization. Such issues can affect their performance and profitability.
- Financial Constraints: CPSUs are financially constrained and they include high leverage ratios, inadequate financing, and poor cash flows. Such financial problems can hinder their capacity to invest in the modernization and expansion projects.
- Global Competition: Since liberalization of the Indian economy, CPSUs are in tougher competition with private and overseas organizations. To sustain competitiveness in the international market, the constant introduction of new products and processes must pursued.
- Policy and Regulatory Issues: The departments in CPSUs also come under a lot of Government control and are restricted in terms of their flexibility of operation to a considerable extent. Complying with the tons of regulations that surround the organization and its related activities is quite a challenging task.