Project monitor reported that Hyderabad based XL Telecom & Energy Limited is upbeat on the prospects of developing solar power projects in Europe. It very recently set up a 1.6 MW solar power plant at Majorca in Spain, making it the first Indian company to set up a solar project on foreign soil.
Mr K Vasudeva Rao executive director of XL Telecom & Energy Limited said that it marked the beginning of an eventual target of setting up 300 MW of solar power capacity in European countries including Spain, Italy and France among others.
The Majorca plant, set up with an investment of EUR 9.5 million is expected to generate revenues of EUR 19 million in its initial life. The plant will be owned and operated by Saptashva Solar SL, a wholly owned subsidiary of XL incorporated in Spain. The new plant has also resulted in XL Telecom & Energy achieving full integration in the solar power business from solar panels to modules to power generation.
Maintaining that Europe had a very high potential for solar power projects, Mr Rao said that this was also matched by attractive incentives offered. He added that in Spain for instance, incentives for solar power generation could be as high as INR 26 per KWH.
When asked if the current global slowdown would affect XL's fund raising for overseas projects, Mr Rao said that the situation was not that bad, albeit admitting that the pace of project implementation would depend on how quickly financial closure is achieved.
Besides setting up solar power plants through Saptashva, XL is also supplying solar panels to other solar power developers in Europe. As of March 2008, XL's order book stood at INR 675 crore mainly catering to European countries. He added that XL Telecom would be the EPC contractor for all solar power projects developed by Saptashva, besides undertaking the EPC works for other developers.
Mr Rao said that the current incentive scheme announced by the ministry for new and renewable energy for grid connected solar power plants was not very attractive and also lacked clarity. He said that "Our immediate focus would be the European market."
He further added that to support the growing demand for solar panels, XL has invested USD 75 million in setting up a 120 MW solar cell manufacturing plant in Hyderabad, Andhra Pradesh. The plant is expected to operate at full capacity by December 2008.
