Analysis: Skills shortage hobbles India's clean energy aspirations

ReNew Energy Global

20/11/2024 03:30

* 
      Skills shortage hits firms' expansion plans, raises costs
    

        * 
      India renewable industry faces skill gap of 1.7 mln by
2027
    

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      India aims to add 500 GW renewable capacity by 2030
    

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      Industry snags cast doubts about ambitious manufacturing
drive 
    

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      Industry seeks more govt support, warns of missing clean
energy
goal
    

  
    By Manoj Kumar and Sethuraman N R
       NEW DELHI, Nov 20 (Reuters) - India's ambitious plan to
expand domestic manufacturing is coming up short in the solar
industry which is grappling with inadequate government funding
and a skills shortage, potentially jeopardising its clean energy
targets, industry leaders said. 
    The hurdles faced by manufacturers of solar panels, cells
and storage batteries are raising costs and delaying projects,
threatening India's ability to reduce its carbon footprint and
meet international climate commitments, they said.   
    It also throws into sharp relief the challenges facing Prime
Minister Narendra Modi's "Make in India" programme, which seeks
to bolster 15 sectors, including renewable energy and
electronics, in an effort to turn the South Asian nation into a
global manufacturing hub. 
    Modi's government has imposed 40% tariffs on Chinese solar
panels and 25% on cells, allocating about $3 billion in
production-linked incentives for local manufacturers as part of
a plan for net zero carbon emissions by 2070.
    However, industry executives say India - the world's
third-largest emitter of greenhouse gases - must significantly
step up funding and training programmes in the renewables sector
to meet its goal of expanding non-fossil fuel capacity by 50 GW
annually to 500 GW by 2030.
    They caution that the absence of stronger government action
could also thwart its broader manufacturing drive that has seen
it plough nearly $24 billion in state incentives over a
five-year period, with another roughly 20 billion rupees set
aside annually for upskilling and training.     
         
    A shortage of skilled manpower is a major problem, said
Dwipen Boruah, managing director of renewables consultancy firm
GSES India, which has trained over 7,000 people in renewable
technologies and wants the government to substantially lift
subsidies for education and training in the sector.
    "Hundreds of private institutes exploit these subsidies but
offer subpar training," he said, adding that small subsidies -
often just a few thousand rupees per student - hinder effective
education. 
    Boruah and other industry executives note that while India
produces over a million engineering graduates annually,
traditional colleges are not equipped to teach solar, wind and
other renewable technologies.
    Some executives say the government's current training budget
of around 5-6 billion rupees should be ramped up by a factor of
10.  
    The ministry responsible for skills development didn't
respond to an email seeking comment. 
    Last week, Pralhad Joshi, India’s minister for renewable
energy, announced the formation of a joint panel with industry
representation to address key issues, including training, to
meet clean energy targets.
    
    A 1.2 MILLION PROBLEM   
    The renewable industry faces a skill gap of around 1.2
million, with demand expected to rise by 26% creating a need for
1.7 million skilled workers by 2027, according to TeamLease
Services, a staffing company, working with industry and
government on training.      
    "The skill gap spans all levels of industry," especially in
emerging technologies like cell manufacturing, battery storage,
and advanced grid integration, said Ashwani Sehgal, president,
Indian Solar manufacturers Association.
    "Industry is facing near 20% attrition of talented workers
annually, posing a risk to production plans."
    Earlier this year, the government proposed to step up
support for upskilling and relax visa restrictions on Chinese
technicians, after many firms said that costly imported machines
were lying unused due to lack of skilled workers.
    Vaishali Nigam Sinha, co-founder of ReNew  RNW.O , one of
India's largest renewable firms with nearly 10 GW of capacity,
said skills shortage is one of the most "underestimated
barriers" to energy transition.
    "The lack of skilled engineers, technicians, and project
managers is pushing up operational costs," she said, a concern
echoed by several industry executives.
    This shortage comes as India speeds up plans for 35 GW of
solar and wind capacity by March 2025, driven by a projected 7%
annual increase in power demand. 
    Manufacturers say the skills gap could also limit India's
plans to expand solar module exports, touching $1.9 billion last
fiscal year, mainly to the U.S. market.
    Tata Power, with 6 GW of renewable capacity, has set up 11
training facilities, training 300,000 youth in solar
installations, battery management, and other green technologies.
    "A skilled workforce is essential for accelerating project
deployment, ensuring efficient operations and maintenance and
driving technological innovation," said Himal Tewari, company's
chief human resources officer.
   
    REMOTE CHALLENGE 
    In Greater Noida, a manufacturing hub on the outskirts of
Delhi, companies are scrambling to hire new employees. 
    Job ads for solar design engineers, technicians, installers
and sales managers are flooding job portals, with salaries
ranging from 20,000 rupees to 100,000 rupees ($239 to $1200) per
month.
    Monica Sehgal, director of Alpex Solar  ALPX.NS , said the
company was offering incentives and overseas training in Taiwan
and Vietnam to attract talent. 
    However, retaining workers at remote locations, particularly
in Rajasthan and Gujarat, remains challenging as employees often
prefer to work in bigger cities.  
    Kapil Sharma, a 19-years old technician, landed a job with a
hefty salary hike at the Alpex factory, on the outskirts of
Delhi, after working with a company in the remote Rajasthan
desert. 
    "I had never seen a solar panel during my three-year
electrical engineering course, and received all training on the
job," he said while operating a panel manufacturing machine. 
    Sharma said a job in a panel factory offered higher pay
compared to textile or auto factories, allowing him to send
20,000 rupees a month back home.  
    "I am now waiting for an overseas training and higher
increments."
    
    ($1 = 84.4010 Indian rupees)

    <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Renewable energy (excluding hydro)  progress in India    https://tmsnrt.rs/47SYw23
Estimated jobs in India's renewable energy by Industry, 2023   
https://tmsnrt.rs/4gMrWmA
    ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
 (Additiona reporting by Sunil Kataria
Editing by Shri Navaratnam)
 ((manoj.kumar@thomsonreuters.com; +919810286200;
Twitter:@manojgulnar;))