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Seeds of Instability Seen in Modi's Push for Solar Boom in India

  • SkyPower, SunEdison and SoftBank pledge billions of investment
  • Local developers see abandoned projects hurting industry
Solar panels stand at the Welspun Energy Ltd. solar power plant in Neemuch, Madhya Pradesh, India, on Wednesday, Feb. 26, 2014. Welspun, backed by Leon Black’s private-equity firm Apollo Global Management LLC, completed India’s largest solar power project as the country diversifies energy sources to combat blackouts. The 151-megawatt photovoltaic plant doubles the operating assets of Welspun Energy Ltd. and raises Indian solar capacity about 7 percent.
Photographer: Vivek Prakash/Bloomberg

India’s solar developers are voicing concern that foreign investors are promising to supply clean power at rates that are unrealistically low, threatening to destabilize the industry.

Companies such as SkyPower Global of Toronto have undercut Indian companies in recent auctions for contracts to build solar power plants. Local rivals including Azure Power and CLP India Pvt. say their competitors may never be able to build the capacity they promise.