The next acquisition of Mukesh Ambani-led Reliance New Energy Solar Ltd (RNESL) will be a battery technology company as Asia’s richest man, according to industry experts, seeks to complete his arsenal across the spectrum of the solar energy business and break Chinese hegemony around the world.
“Next in line, when I look at their chessboard, I think they will make a battery technology acquisition,” said Ratnadip Bhattacharjee, CEO and Director of ArrayTech Technologies Pvt Ltd, a solar design and engineering services company.
Then his entire technology circle consisting of solar modules, panels, cells, wafers and batteries will be closed, said Bhattacharjee.
According to an industry advisor, storage is “an area that has always been a problem for the solar industry”.
“As soon as he has the battery technology under control, he can generate electricity whenever the sun is available, store it and make it available as needed, so that there is no imbalance between production and consumption,” says the consultant.
Battery technology will also help the electric vehicle industry move forward.
New energy business
Ambani’s strategy and vision on his foray into the new energy business has begun to unfold with the tide of recent acquisitions, mostly in the technology space.
“Trust means putting the farmers in the right place,” says Bhattacharjee. “Ambani is acquiring technology, companies that have good technology in this area,” he said.
Reliance’s strategy of viewing the solar business as a technology rather than a short-term moneymaker or a small business is electrifying the industry.
“Ambani doesn’t see business on a global scale in terms of customs administration, not a lobbying opportunity and things like that, but business in itself. He’s taking on China on the global stage, you can’t fight anyone by raising tariffs. He does not intend to take over China for the Indian part of the business, ”says Bhattacharjee.
With the exception of Sterling & Wilson Solar Ltd, an EPC company, the takeover of the Norwegian solar cell, panel and polysilicon manufacturer REC Solar Holdings AS, the German developer of monocrystalline green solar wafers NexWafe GmbH and the cooperation agreement with the Danish Stiesdal A / S for Technology development and manufacturing of HydroGen electrolysers in India shows the direction in which Ambani’s new energy concept is going.
“You can only survive in this business if you have the technology and the scale. Size is always its strength, size is not a problem for Reliance. So he strives for technology. If you don’t have those two, you will be just after lobbying the government to collect customs or other charges here because you will never be competitive. Not only are none of the Indian companies uncompetitive, they don’t even make decent solar modules compared to Chinese modules and are far behind technologically, ”said a second solar industry official.
The aim is to be a global player
Using an inferior electrical panel adds to the cost of installing solar panels, and the only way the local industry can survive is to get the government to impose tariffs here and there.
Reliance sees it as a global business, not just for India. Ambani wants to be the key supplier for the entire solar industry. For this Reliance needs technology and size, because otherwise it cannot be a global player in this area.
“The problem with the solar industry today is that most of the people who know the technology are in China. It is very difficult to come to China and control this technology, so he chose the Europeans for the technology, ”said the executive director.
From that perspective, the $ 771 million acquisition of REC Solar Holdings AS is seen as Ambani’s first attack on Chinese dominance. Although REC was based in Norway, it was owned by Beijing-based specialty chemicals and materials company China National Bluestar (Group) Co Ltd (Bluestar).
“REC is one of the last module manufacturers outside of China that also has good technology, albeit a little expensive. But when you have the technology, the price is manageable, ”said the industry manager.
Solar module technology
Outside of China, there is currently very little technology for solar module or cell manufacturing as most of the companies have merged.
All major solar module manufacturers worldwide have lost to Chinese manufacturers. “If you are looking for a company with large and also some rapid manufacturing capabilities and technology to manufacture, REC is a very good choice from Reliance,” he said.
NexWafe is a wafer manufacturer that also has good technology and is helping Reliance extend its reach beyond the wafers and cells underpinned solar technology space.
Both are considered a good purchase, as otherwise Reliance would have to go shopping in China, which could be difficult for Ambani to pick up a Chinese company and get the technology. “Buying a company is easy, but technology in this area is very difficult,” said the industry manager.
The solar industry is characterized by constant technological change.
“None of the Indian manufacturers in the solar business have control over the technology part. They are essentially just followers. Because it’s the technology game with which you can beat the others. So I think the acquisition of Reliance is very well thought out. You have only recently entered this sector but have a much better understanding of the fundamentals of this business than the others, ”added Bhattacharjee.