Indian Oil Companies Plan $3.1 Billion Solar Power Parks

The Indian government has announced that two of its oil refining companies shall make a massive investment to set up large-scale solar power project in the state of Madhya Pradesh.

The Indian ministry of petroleum recently signed an agreement with the government of Madhya Pradesh which will see India Oil Corporation and Oil India develop solar power projects with cumulative capacity of 2.7 GW. The total investment required for these projects is expected to be Rs 20,700 crore (US$3.1 billion).

The government had earlier announced a total capacity of 1 GW to be commissioned by these companies, the target now seems to have been significantly upgraded. These projects shall help the oil refining companies meet their renewable purchase obligation under which they are required to acquire a set minimum percentage of solar power every year.

The plan by the two companies seems to be in line with similar announcements by other public sector companies, including Coal India, NALCO, Indian Railways, and Neyveli Lignite Corporation. The central government has directed several entities to set up large-scale solar power projects on surplus land.

The government also recently launched its ‘solar zones’ policy. As per the policy, ten zones of 10,000 hectares each will be identified across the country for setting up an estimated 25 GW of solar PV capacity. The land will be offered to interested project developers to set up large-scale solar projects. The oil refineries may use this new policy to set up their solar parks.

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