India Hates Coal

"By Jeff Siegel"

If you
think the war on coal in the U.S. is bad, you ain't seen nothing
yet!

We recently got word that India is set to double the tax on coal
production, while promoting electric vehicles and renewable energy
projects.

I'm pretty sure there's some Luddite reporter in Mumbai right now
who's head's about to explode.

But that's neither here nor there.

While I'm no fan of regulatory regimes of any kind, I'd be lying
if I said I wasn't happy to know that a crap-ton of money is
getting funneled into renewable energy and electric cars in India,
and not coal. This is for two reasons...

1.) India is one of the most polluted countries in the world. And
while fuel wood, biomass, and traffic congestion are bigger
culprits when it comes to air pollution, certainly reducing
coal-fired power isn't going to hurt.

2.) Thanks to India's latest hard-on for renewable energy, we're
now presented with even more opportunity to profit from from the
inevitable transition of the global energy economy.

THIS IS HUGE

As it stands now, India plans to add 175 gigawatts of renewable
energy generation capacity by 2022. 100 gigawatts of that will
come from solar.

To put this in perspective, the U.S. currently has less than 18
gigawatts of solar capacity installed.

This is huge!

Analysts over Deutsche bank issued a report about a week ago
which indicated that by 2022, 25 percent of India's power will
come from solar. Analysts also suggested that solar will
ultimately become the dominant source of electricity around the
globe, generating 5 trillion in revenue over the next 15 years.

Deutsche bank notes that over the next 5 to 10 years, new
business models will generate a significant amount of economic and
shareholder value, and that "within three years, the economics of
solar will take over from policy drivers (subsidies)."

I love it!

Here's more...

As we look out over the next 5 years, we believe the industry
is set to experience the final piece of cost reduction -
customer acquisition costs for distributed generation are set to
decline by more than half as customer awareness increases, soft
costs come down and more supportive policies are announced.

While the outlook for small scale distributed solar generation
looks promising, we remain equally optimistic over the prospects
of commercial and utility scale solar markets.

We believe utility-scale solar demand is set to accelerate in
both the US and emerging markets due to a combination of
supportive policies and ongoing solar electricity cost
reduction. We remain particularly optimistic over growth
prospects in China, India, Middle East, South Africa and South
America.

The biggest solar player in India is Tata Solar Power, which is a
subsidiary of Tata Power.

Other solar companies with a solid foothold in India include
SunEdison (NYSE: SUNE)
and First Solar (NASDAQ: FSLR).

Definitely keep a close eye on India throughout the rest of this
year as new laws, regulations and incentives kick the Indian solar
market into overdrive.

Jeff Siegel is Editor of Energy and Capital, where this article was first published.