Study on Common Risk Mitigation Mechanism (CRMM) for Solar Power Generation Projects in Solar Rich Countries Commissioned

India along with countries like Argentina, Burkina-Faso, Chad, France, Ivory Coast, Mali, Namibia, Niger, Nigeria, Senegal, Uganda and Yemen has jointly commissioned a study to define and structure a Common Risk Mitigation Mechanism (CRMM) for solar power generation projects in solar rich countries. The commissioning of the study is aimed at dramatic reduction in the cost of finance for renewable energy and the overall price of electricity. The exercise is part of the international efforts aimed at implementing the the Paris Declaration of the International Solar Alliance (ISA) adopted on 30 November 2015.
The study has been entrusted to a task force chaired by Terrawatt Initiative (TWI), the World Bank Group, the Currency Exchange Fund (TCX), the Council on Energy, Environment and Water (CEEW) and also the Confederation of Indian Industries (CII). Each of the participating countries will also appoint a qualified representative who will cooperate with the task force and provide information regarding the country specific expectations, experience and needs of the task force. All the countries lying fully or partially between the Tropics are also invited to join the task force and support this initiative in order to attract investments into solar sector.

Need

The Council on Energy, Environment and Water calculates the cost of capital to form a substantial amount in the total costs of renewable energy. In India it accounts for 70% of the total cost of solar Power. In this regard, the CRMM is expected to offer a simple and affordable tool that will develop a secure environment for private institutional investment in solar assets.

ISA

On the first day of the COP-21 summit, the International Solar Alliance was launched by Indian Prime Minister Narendra Modi and French President Francois Hollande as a union of countries with abundant sunlight. Under this alliance, 121 countries that fall within the tropics {i.e. between Tropic of Cancer and Tropic of Capricorn} have been invited to make collaborative efforts to harness solar energy to generate the electricity. Most of these countries fall within Asia, Africa and South America.There are three objectives behind the International Solar Alliance. First is to force down prices by driving demand; second is to bring standardization in solar technologies and third is to foster research and development.

Month: Current Affairs - May, 2017