There’s a method to Reliance Industries’ biggest disruptive strategies. For years, India’s largest private conglomerate patiently waits for fault lines to appear in large industries that were thought to be stable and predictable. When it spots those fault lines—usually when the industry is poised at a key technological transformation moment—it moves fast to pack them with disruptive dynamite. That means some new technology that could potentially allow it to leapfrog over incumbents. That means bringing to bear billions of dollars of capital from its virtually limitless balance sheet to scale its new technology faster than anyone else. If there’s a geopolitical angle around the new technologies, even better.
By doing this, Reliance attempts no less than the reset of the rules of business the industry and its participants played by. It hopes to not just win market share, but remake the market itself in the way it desires. It doesn’t always work, but when it does, the results are incredible. Exhibit 1 would be how it entered India’s crowded and supposedly mature telecom sector at the cusp of its transition from 2G and 3G to 4G. And in the process became the number one player in just a couple of years.
Reliance is now attempting something similar in a very different sector—solar power.
Having committed to invest over $10 billion in the next three years to build its clean energy business, it has made 3 significant investments earlier this month. These include $770M to acquire REC Solar Holdings, a solar cell and module maker, and $380M for a 40% stake in Sterling & Wilson Solar, a large solar farm builder.
Like in telecom with 4G, Reliance is betting that the solar cell manufacturing industry globally is poised at a trans-formational moment.
China supplies more than 70% of the world’s solar modules, and in 2021, around 90% of the modules sold globally are expected to be based on the mono PERC technology. While mono PERC will continue to dominate for the next few years, the race for its replacement is already on. The two candidates are HJT (heterojunction) and TOPCon (tunnel oxide passivated contact).
Reliance is betting on HJT, which has a theoretical efficiency—the percentage of sunlight converted to usable electricity—of 27.5%, higher than mono PERC’s 24.5%.
“Reliance is very creative as a disruptor,” says Sydney-based Buckley. “They are investing in breakthrough technologies and illustrating them at scale in India.” Buckley is director of energy finance studies for Australia and South Asia at the Institute for Energy Economics & Financial Analysis, a think-tank headquartered in Ohio.
Our article and blog today is a great way to understand Reliance’s massive new bet on solar power. Like one of our Team other sources, the director of a small module maker, tells him, “Reliance is going to make things difficult for other players. #yusufbhandarkar www.multimediastudio.net
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