Clean Tech Report
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Towards a Cleaner India The current state of Cleantech Industry in India and opportunities for Swiss startups and SMEs This report is created and published by: swissnex India l Consulate General of Switzerland #26 Rest House Crescent Road, Bangalore, India 560001 Tel.: +91 80 4941 2000 To download this report, visit: www.swissnexindia.org To order copies of this report, send an email to: [email protected] Content partners: Excubator, Bangalore Date of publishing: May 2015 Designed and printed in India swissnex India connects Switzerland and India in the fields of science, education, art and innovation. An initiative of the Swiss State Secretariat for Education and Research and Innovation (SERI) in association with the Swiss Federal Department of Foreign Affairs, swissnex India is part of the Consulate General of Switzerland in Bangalore (www.swissnexindia.org). Table of Contents EXECUTIVE SUMMARY 3 1 INDIA’S CLEANTECH INDUTRY: PAST AND EXPECTED PERFORMANCE, SCOPE AND SIZE 4 1.1 Current market potential and scope in India 4 2 CLEANTECH IN INDIA: SCOPE, CHALLENGES, AND GROWTH 6 2.1 Renewable Energy 6 2.2 Water and Waste Management 8 2.3 Electronic Waste 8 3 HUMAN EMPLOYMENT AND INFRASTRUCTURE SUPPORT IN INDIA 10 4 CLEANTECH INTELLECTUAL PROPERTY SCENARIO IN INDIA 11 4.1 Patent 11 4.2 Copyright 11 4.3 Trademarks 12 4.4 Protection of Integrated Circuit Layout Design (IC) 12 4.5 Industrial Design 12 4.6 Government Initiatives and Policies 12 4.7 Jawaharlal Nehru National Solar Mission 13 4.8 Generation Based Incentives (GBIs) for Wind Energy 13 4.9 Hydropower Policy 13 4.10 Energy Efficiency 13 4.11 Regulatory Framework Policy 14 4.12 Policy and Regulatory Environment for FDI and investment in Clean Technology 14 5 STARTUP SCENARIO IN CLEANTECH INDUSTRY IN INDIA 15 5.1 Venture Capital and Investment Scenario 15 5.2 Success stories 16 5.3 Startup ecosystem 18 6 OPPORTUNITIES AND CHALLENEGES IN INDIA IN CLEANTECH SECTOR AND ENTRY BARRIERS 19 7 CONCLUSIONS AND RECOMMENDATIONS 20 Towards a Cleaner India In the fields of energy, water and waste management, the country offers phenomenal potential for the Cleantech industry. A quarter of the population still lives without access to electricity. Huge energy need $100 billion India’s investment target in renewable energy over the next five years, towards 100 GW of solar and 60 GW of wind capacity by 2022 24 million people without Electricity generation electricity in Growth required to meet urban areas the rising demand 350 GW 710 GW 300 days of offshore wind energy of sunshine annually. potential. Entirely A great opportunity untapped as of 2015 for solar power 280 million people without 243 GW electricity in rural areas 2014 2032 Energy mix Renewable energies Installed capacity in 2014 � Potential capacity (GW) | � Installed capacity (%) Large hydro 17% Coal Waste to energy 60% 4 GW | 3% Small hydro 20 GW | 19% Renewable Nuclear and oil Wind (onshore) energy 2% 103 GW | 21% 12% Solar Biomass Bagasse cogeneration Gas 100 GW | 3% 18 GW | 11% 5 GW | 53% 9% Water demand Waste management Expected growth 2x Expected annual growth of +7% Municipal and domestic Municipal solid waste by 2030 the market until 2025 4x +10% Industrial Electronic waste Promising Solar power Wind energy Rainwater Biofuel business Micro-solar stations that Technology and consulting, Harvesting systems for new Small capacity plants that are located close to rural especially for offshore buildings; compulsory in 18 produce biofuels for local areas clusters projects of India’s 28 states populations 4 Read the full CTI Startup report on the Indian Cleantech industry at www.swissnexindia.org EXECUTIVE SUMMARY: THE CURRENT STATE OF CLEANTECH INDUSTRY IN INDIA AND OPPORTUNITIES FOR SWISS STARTUPS AND SMEs India has witnessed significant growth in the clean technology market over the past few years. A recent report submitted by Ernst and Young states that the share of renewable energy in the country’s total energy mix grew from 7.8% (2008) to 12.3% (2013). In real terms, the growth of installed capacity for renewable energy in India has increased from 12.3 GW to 28.1 GW during the same period. Issues such as global warming, climate change, and pollution have exacerbated the need to adopt cleaner technologies, while the need for energy to power India’s economic growth is rising. In order to provide a balance between economic growth, development and the environment; cleaner production strategies coupled with clean technologies is slated to increase resource efficiency, innovation, and reduced cost of environmental management. Rapid economic growth has substantially fueled demand for energy countrywide. The heightened competition for procurement of fossil fuels, prices of petroleum, and stagnant domestic production of energy have propelled India into potential energy crisis. To this end, the need for adoption of cleaner technologies presents a relatively large opportunity for both domestic and international ventures looking to offer products and services in India. Renewable energy, energy efficiency, and water and water waste management in particular are the most important drivers of clean technology in India. With this background, opportunities exist for Swiss entrepreneurs and SMEs to offer products as well as technologies in multiple areas including generation, distribution and storage of clean energy, as well as opportunities for recycling multiple forms of products. Specifically, opportunities exist for providing technology and consulting in the offshore wind energy market. In the biofuel space, there are opportunities for setting up small plants to cater to local populations. Water treatment offers opportunities in the area of technology transfer. This report outlines India’s Cleantech scenario, and is intended to give the reader a succinct overview of this sector, as well as areas of opportunity and challenges. 3 Cleantech in India not only refers to just generation of Renewable Energy but also covers Water and Waste Water Management, Electronic Waste disposal and Recycling. The Clean tech range covers an array of products, services and processes that harness renewable 1. materials and energy sources, dramatically reduce the use of natural resources, and cut or eliminate emissions and wastes. India’s The Renewable Energy (RE) market alone in India is estimated to be worth over US$ 17 Cleantech Billion and is growing at an annual rate of 15%1. Of the total RE potential of the country Industry (estimated to be around 200 GW, only 19.97 GW has been tapped, leaving a huge gap Past and Expected between potential and installed capacity. All forms of RE (wind, small-hydro, solar, biomass and waste to energy) have significant potential in India. The government is looking at Performance, Scope attracting investments in RE of over US$ 200 billion for it to account for 15% of the overall and Size energy basket. On the Water and Waste Water Management front, the Indian Water Resources Ministry plans to invest US$ 50 Billion over the next five years in multiple geographies across the country. While actual data on the generation or import of e-waste is currently not available for India, several studies conducted by various agencies have estimated that the volume of e-waste generated in India will reach 0.7 million Metric Tons (MT) by 2015, and 2 million MTs by 2025. This spells significant opportunities for ventures interested in recovering metals or plastics from e-Waste2. 1.1 Current Market Potential and Scope in India As mentioned earlier, the Indian renewable market is estimated to be worth over US$ 17 Billion, growing at an annual rate of 15%. Wind energy remains dominant, and Swiss companies can take advantage of this market (India is one of the world’s largest wind energy markets). India imports both finished goods as well as technology for wind turbines, windmill blades, wind battery chargers and converters. The Government of India has stated that it has a target of creating 10 GW of biomass power by 2020. This includes the potential to generate energy from both household as well as industrial waste. In a country which experiences, on average, 300 days of sunshine every year, the potential to generate solar power is significantly high. The Government of India has embarked on a plan to produce 1003 GW of solar power by 2022. This is in addition to the potential for products that drive energy efficiency, which is projected to reach US$ 27 Billion in 2018. The market for technologies that target Green Buildings was US$ 3 Billion in 2012. It is estimated that Green Buildings could account for 20% of all construction in India by 2030 (an estimated 80 1 http://www.asa.in/pdfs/surveys-reports/power-and-energy-industry-in-india.pdf 2 http://borjournals.com/Research_papers/Ap_2013/1208M.pdf 4 billion square feet). Smart Grids, yet another innovation in the energy efficiency area, is at a nascent stage in India. The water and wastewater management industry has seen a market potential of US$ 1.2 Billion in the past year, and is expected to grow at 10% for the next five years. Government projects contribute to a little over half of the market in terms of revenues. Increasing urbanization has led to growing demand in water and sewage treatment. Many manufacturing facilities have been forced to adopt water-recycling systems due to scarcity of water. The opportunity in water and wastewater management is exacerbated due to growing public concern, media pressure, and renewed legislation. Over 40% of this market is sustained by imports from the USA alone. In addition, the government of India plans to invest close to US$ 50 billion in this space in the next five years. There is also scope for growth in solid waste management and electronic waste.