Indian CSR law could boost solar rooftop prospects
Now that India’s large-sized companies are being obliged to spend two percent of their profit on corporate social responsibility (CSR) activities, the country's rooftop solar installers are seeing rupee signs.
India's upper and lower houses have passed the Companies Bill 2011 into law, which mandates this CSR responsibility. It defines large-sized companies as those with a profit of INR5 billion (USD80 million) or more and a turnover of INR 10 billion (USD162 million) or more.
Solar energy is considered an activity that falls under CSR, as part of “ensuring environmental sustainability”, one of nine 'pillars' that qualify for the initiative. The benefit of going the solar route is that at least the expenditure can offer a return to the business in reduced power bills of facilities and possibly qualify for a feed-in tariff.
At the moment, however, the question of tariffs is vexing solar installers. The Ministry of New and Renewable Energy has delayed introducing subsidies for rooftop solar and demand has been light and installers will be hoping that a boost to the sector will come from this CSR initiative.The Indian government points to the success of CSR strategies that have incorporated solar elsewhere in the world, although none have been done on a legislative basis. As part of US retail giant Wal-Mart's supposed CSR activity, it has installed solar on 31 of its facilities in California and Hawaii and has reduced energy costs by INR50 million (USD816,000).