Study for Design of Policy Package, Develop Incentive Schemes, and Identifying Intervention Areas for Upgradation and Promotion for SME Manufacturers of New and Renewable Energy Equipments

The importance of renewable energy is recognised by everyone and there is greater and greater impetus to increase the renewable energy share in the energy portfolio from the point of view of long term energy supply security, decentralization of energy supply, environmental benefits and sustainability.

The Small and Medium Entrepreneurs (SMEs) are the backbone for growth of any industry and as of today over 3.6 million SME’s are backbone of India’s economic engine (since they account for 45% of industrial production & 40% of exports). The same is true for renewable energy growth. However SMEs are marred with many challenges and problems. It becomes imperative to support SMEs for their upliftment, make them competitive, self dependent through enabling policy and mechanism.

Under the Asia Pacific Partnership program, PA Consulting on behalf of United State Agency for International Development and Ministry of New and Renewable Energy has undertaken the study to evaluate existing small and medium manufacturers with respect to their Infrastructure Capabilities as well their business competencies, with a view to assist discerning units to upgrade themselves. M/s APITCO Hyderabad has been assigned the “Study and Design of Policy Package for SME Manufacturers of New and Renewable Energy Equipments”. The study will cover 100 SMEs involved in manufacturing of equipments for various renewable energy sources; Solar, wind, Biomass, biogas etc.

The key features of the study are:-

• Study of existing policy framework and regulatory regime to develop an understanding of the existing regulatory, policy and market environment.
• Identification of parameters for evaluation & benchmarking of SME manufacturers of renewable technologies on all business aspects including technology, operations, marketing, sales, strategy, financing and customer orientation.
• Design computation method and evaluate overall points earned and grading of manufacturing units based on overall points earned.
• Identifying areas of intervention in policy framework, constraints in R&D, technology, operations and marketing activities and developing policy and incentive schemes to promote manufacturing of new and renewable energy equipments by SMEs. Also recommend the successful applied cost effective technologies available for SMEs engaged in renewable technology equipments manufacturing.
• Identifying the critical constraints that prevent the industry from further expansion in the global share and emerge as one of the major production and export hub in the coming years.
• Identifying the needs of promoting sales and marketing network including requirement of setting up of dealer network etc.
• Prepare case studies highlighting successful operation and scaling up of SME to larger operations. It is also required to prepare case studies highlighting stories therein of units which failed in spite of best efforts.
• Implementable recommendations for development of policy package including an incentive structure to promote SME manufacturer of renewable technologies so that SMEs can upgrade their skills, technology and business practices.
• An updated list of manufacturers of Renewable Energy Equipments

After the study four workshops will be arranged in four different places to update the stakeholders of the findings. Ministry of New and Renewable Energy will take the findings for policy makings. The entire task is expected to be completed by 30th September 2009.