The sun is slowly rising on India’s solar sector. Following the NDA-led government’s ambitious target to achieve 175 GW renewable energy capacity by 2022 of which 100 GW is to come from solar, the industry has witnessed an ebb tide — with more than a hundred players operating around 2010, barely 20-odd players are feeling the sun shining rather pleasantly on them today.Roughly five years ago when the industry was still finding its bearings, it was a pool that every kid wanted to jump in to but a streak of consolidation activity in the solar industry has separated the wheat from the chaff. Well-funded companies are adding aggressively to their portfolios, and significantly defining the trajectory of solar tariffs – crashing rates are sending the spirits of consumers high, meaning larger integration of renewable energy into the grid. Operating world’s one of the largest solar projects in Tamil Nadu, Adani Green Energy has invested $2 billion in its solar business to emerge as the leading player with operational portfolio in India. The company, growing largely on strong financial backing, plans to add 5 GW capacity over the next two to three years. 
 “Financial prudence and financial backing, along with strong execution skills will be key to sustaining in the sector going forward,” said Sagar Adani, executive director of Adani Green Energy.  “Financial prudence and financial backing, along with strong execution skills will be key to sustaining in the sector going forward,” said Sagar Adani, executive director of Adani Green Energy.  Sumant Sinha, whose clean energy venture ReNew Power is backed by big-ticket investors such as Goldman Sachs and Abu Dhabi Investment Authority, counts on his company’s capital structure, and access to multiple sources of funding as one of the key drivers of ReNew’s growth.  We benefit from a robust balance sheet, which we leverage prudently to support our growth. We have raised a mix of equity, project finance and corporate debt,” said Sinha, CMD of ReNew.  The key to remain in the big boys’ club is to maintain a cautious approach to growth, according to CEO of Hero Future Energies (HFE), Sunil Jain. For players with deep pockets, the industry is spattered with projects up for sale. The consolidation drive in the renewable energy market came early on and started with a bang with Tata PowerNSE -0.47 % acquiring Welspun’s solar assets for $1.4 billion in 2016. This kicked off a spate of consolidation activity, and ReNew’s Sinha made headlines with the acquisition of Ostro’s wind and solar assets for a whopping $1.6 billion earlier this year.  “Solar is a very simple technology with low entry barriers. Hence, the only sources of competitive advantage are ability to raise large amounts of cheap institutional money plus procurement scale,” said Vinay Rustagi, MD of renewable energy consultancy Bridge to India. This explains why smaller players may want to exit but the struggle to dust static portfolios off their hands remains. Solar power tariffs have fallen by over 64% in the last five years, and sub-Rs 3 level has become the new normal in the last one year or so. Last year, solar power reached grid-parity, becoming cheaper than thermal power – an important landmark that gave the government another reason to market solar power with gusto. Falling tariffs, however, is making developers uncomfortable. The solar power industry has witnessed falling tariffs in recent times. This trend could have affect the profitability of power projects in future. If companies miscalculate or misjudge tariff rates and incorrectly factor the costs of construction, development, land acquisition and price of components (including due to increase in duties and other levies), the economics of the bid may be affected and the project may become unviable,” Sinha said.