Can't sleep! Deep Diving into Renewables sector instead.
A deep data driven research thread below 👇🧵
A deep data driven research thread below 👇🧵
Renewables were the only energy source for which demand increased in 2020 despite the pandemic, while consumption of all other fuels declined.
90% of all new power capacity added globally was for renewables.
Let that number sink in, 90%
Let that number sink in, 90%
Despite the pandemic, renewable capacity globally increased 45% to 280 GW.
This is the highest year over year increase since 1999.
*The highest YoY increase in renewables history came during a pandemic, imagine what happens when the pandemic subsides
This is the highest year over year increase since 1999.
*The highest YoY increase in renewables history came during a pandemic, imagine what happens when the pandemic subsides
Annual Net Renewable Capacity Additions 
Annual increase in Solar PV Development in 2022 will be 162GW
this number is 50% higher than pre pandemic demand of 2019
*shows the really bull run of Solar PV development is ahead of us, not behind
this number is 50% higher than pre pandemic demand of 2019
*shows the really bull run of Solar PV development is ahead of us, not behind
Just in 2020, 135GW of Solar PV capacity was installed, representing a 23% growth from previous year.
Show me another industry that grew 23% globally in a pandemic induced year.
Show me another industry that grew 23% globally in a pandemic induced year.
Majority of this addition was made in China (80% of all increased in capacity from 2019 to 2020)
Subsidy deadlines of 2020 in China and Vietnam helped rush developers to commission projects at a rapid pace.
China and Vietnam officially have ended their previous subsidy policies.
China and Vietnam officially have ended their previous subsidy policies.
Pandemic created lot of logistic issues. However, deployment slowdown was only witnessed in Q1 of 2020 and mostly in China.
Rest of the world, all projects continued along despite of movement restrictions and supply chain delays.
Even a pandemic couldn't stop this industry.
Rest of the world, all projects continued along despite of movement restrictions and supply chain delays.
Even a pandemic couldn't stop this industry.
Quarterly renewable capacity addition in India vs China
The blue is China
Look how tiny we are compared to China!
Shows how much scope is there for renewables in the country.
The blue is China
Look how tiny we are compared to China!
Shows how much scope is there for renewables in the country.
China vs US
Europe vs USA
Everyone compared to China
China beats everyone by a margin of 10!
Next demand will come from
1. Europe
2. Latin America
3. USA
4. India
5. Asia Pacific
Next demand will come from
1. Europe
2. Latin America
3. USA
4. India
5. Asia Pacific
270 GW coming online in 2021
280 GW coming online in 2022
280 GW coming online in 2022
Solar PV will account for 55% of all renewable capacity expansion in 2021 and 2022.
145 GW in 2021
162 GW in 2022
145 GW in 2021
162 GW in 2022
By far, solar remains the champion of renewables the world over.
Main reasons
1. Easier to install
2. Cheapest source of electricity on the planet
3. Industry growing by leaps and bounds
Main reasons
1. Easier to install
2. Cheapest source of electricity on the planet
3. Industry growing by leaps and bounds
Although China has accounted for 40% of global renewable capacity growth for several years already, for the first time in 2020 it was responsible for 50% – a record level resulting from the unprecedented peak in new installations in December.
Growth in China will slow down in 2021 as Govt figures out new policy. Demand and growth will accelerate again after 2022.
China has a target of attaining net zero emissions by 2060 and solar remains a big factor in that.
China has a target of attaining net zero emissions by 2060 and solar remains a big factor in that.
Even after slowdown in 2021 and 2022, additions will remain above the average of 2017 to 2019.
China, alone accounts for nearly half of the world's renewable capacity addition.
Let's shift our focus to Europe now.
Europe is now the second largest market for renewables after China.
EU has a target of 2030 to meet Paris Goals.
EU has a target of 2030 to meet Paris Goals.
In the other side of the world, United States is busy simplifying its subsidy policy for existing renewables projects and drafting plans to announce Billions of Dollars worth of new renewable projects.
Everyone compared to China
China beats everyone by a margin of 10!
Next demand will come from
1. Europe
2. Latin America
3. USA
4. India
5. Asia Pacific
Next demand will come from
1. Europe
2. Latin America
3. USA
4. India
5. Asia Pacific
270 GW coming online in 2021
280 GW coming online in 2022
280 GW coming online in 2022
Solar PV will account for 55% of all renewable capacity expansion in 2021 and 2022.
145 GW in 2021
162 GW in 2022
145 GW in 2021
162 GW in 2022
By far, solar remains the champion of renewables the world over.
Main reasons
1. Easier to install
2. Cheapest source of electricity on the planet
3. Industry growing by leaps and bounds
Main reasons
1. Easier to install
2. Cheapest source of electricity on the planet
3. Industry growing by leaps and bounds
Although China has accounted for 40% of global renewable capacity growth for several years already, for the first time in 2020 it was responsible for 50% – a record level resulting from the unprecedented peak in new installations in December.
Growth in China will slow down in 2021 as Govt figures out new policy. Demand and growth will accelerate again after 2022.
China has a target of attaining net zero emissions by 2060 and solar remains a big factor in that.
China has a target of attaining net zero emissions by 2060 and solar remains a big factor in that.
Even after slowdown in 2021 and 2022, additions will remain above the average of 2017 to 2019.
China, alone accounts for nearly half of the world's renewable capacity addition.
Let's shift our focus to Europe now.
Europe is now the second largest market for renewables after China.
EU has a target of 2030 to meet Paris Goals.
EU has a target of 2030 to meet Paris Goals.
In the other side of the world, United States is busy simplifying its subsidy policy for existing renewables projects and drafting plans to announce Billions of Dollars worth of new renewable projects.
In India, pandemic impacted a lot.
Total capacity addition declined by almost 50% from 2019 to 2020.
Total capacity addition declined by almost 50% from 2019 to 2020.
However, India will report new record capacity additions in 2021 and 2022.
The biggest risk renewable energy deployment in India are the DISCOMs.
Govt has proposed new reforms of USD 40 Billion to improve DISCOMs finances and operations which may help.
Govt has proposed new reforms of USD 40 Billion to improve DISCOMs finances and operations which may help.
Ministry of New and Renewable Energy's budget will soon surpass Ministry of Coal's yearly Budget.
Several major policies and PLI schemes by Govt. of India are targeted to help the sector evolve and bring out the AtmaNirbhar within the sector.
India and China lead the world in terms of new renewable capacity auctions
Another area of growth are the corporates.
Almost every major company in the world has announced plans to achieve net carbon zero by some time in the coming decade.
These corporates are big drivers of both Solar and Wind energry.
Almost every major company in the world has announced plans to achieve net carbon zero by some time in the coming decade.
These corporates are big drivers of both Solar and Wind energry.
Larger projects will dominate Solar PV Market.
*Makes sense, as Govt around the world are giving out major utility scale auctions
*Makes sense, as Govt around the world are giving out major utility scale auctions
Increase in demand is causing prices of commodities in solar modules to increase as well
But this is not a big issue as solar module cost is only about 30% of the entire solar project. So even at elevated prices, solar projects are still feasible, albeit at lesser profitability than before.
Overall, the industry looks great and the trend towards move to renewables is here to stay.
That being said, here are the type of companies you can invest in.
1. Solar PV Plant Set Up Companies
These are companies like Adani Green, ReNew Power, Azure Power, Vikram Solar etc.
They usually set up large scale solar plants and revenue comes from signing 25year PPAs with the Govt/Discom
These are companies like Adani Green, ReNew Power, Azure Power, Vikram Solar etc.
They usually set up large scale solar plants and revenue comes from signing 25year PPAs with the Govt/Discom
2. Solar TurnKey Solutions Companies
These are basically advisors and consultants who take up the responsibility to set up a solar plant in return for a fixed fee.
Firms like Sterling & Wilson Solar fall under this category
These are basically advisors and consultants who take up the responsibility to set up a solar plant in return for a fixed fee.
Firms like Sterling & Wilson Solar fall under this category
3. Solar Equipment Manufacturers
These are companies that make solar modules or parts that go into solar modules.
Great thing about these companies are that they get paid in 30-60 days and do not have to depend on 25yr PPA or fixed fee type payments to earn.
These are companies that make solar modules or parts that go into solar modules.
Great thing about these companies are that they get paid in 30-60 days and do not have to depend on 25yr PPA or fixed fee type payments to earn.
Research well, find your horse and ride it well. This once in a lifetime generational shift in energy is here to stay!
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Published a report related to Renewable Sector last year.
Thank you for reading! 🙏
investkaroindia.substack.com/p/renewables
Published a report related to Renewable Sector last year.
Thank you for reading! 🙏
investkaroindia.substack.com/p/renewables
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