USA joins International Solar Alliance as 101st member country

Last Updated13/11/2021

The United States has joined the International Solar Alliance (ISA) as a member country.
It becomes the 101st country to sign the framework agreement of the ISA to catalyze global energy transition through a solar-led approach.
US Special Presidential Envoy for Climate, John Kerry announced the decision at COP26 in Glasgow.
Earlier, the fourth general assembly of ISA was held.

The ISA is an intergovernmental treaty-based organisation with a global mandate to catalyse solar growth by helping to reduce the cost of financing and technology.
ISA is the nodal agency for implementing One Sun One World One Grid (OSOWOG), which seeks to transfer solar power generated in one region to feed the electricity demands of others.

The Headquarters is in India with its Interim Secretariat being set up in Gurugram.

To collectively address key common challenges to the scaling up of solar energy in ISA member countries.

The private sector is willing to contribute $500 million and the public sector another $500 million. This gives ISA financial sustainability.
ISA has the potential to popularise new financial mechanisms that are popular now in India such as masala bonds as well as green solar bonds, for raising cheap money in other nations also.

It will give the desired push towards clean energy when the world is reeling under the impact of climate change due to pollution from energy generating plants like coal etc.
The Alliance has a 24×7 Solar Cyber Centre. This will give open access to all nations for advice and information on many projects and financial innovation.
The Alliance can also play an advocacy role in asking the financial institutions to offer a part of their lending for solar energy.
This is like what the Reserve Bank did in India – up to 15 crore investment in the field of renewable energy is a priority sector lending. And, up to 10 lakh is a priority sector lending for rooftop solar panels.

This could position India as an energy leader of sun-rich developing countries
It showcases India as a strong contender internationally and could generate job opportunities of a global nature.
The ISA could be the beginning of more macro-level analysis and discussions of international energy markets, rather than just focussing on Indian policies or domestic policies.
India lacks adequate infrastructure for solar energy. Further, the cost of solar power is not yet commercially viable.
To reach its desired target of 100GW of solar power, ISA can help fund the capacity addition and make solar power commercially viable.
It can also adopt best practices in renewable energy

ISA is the first organization in the world, which will have a sole focus on solar energy, unlike IEA (International Energy Agency), IRENA (International Renewable Energy Agency) and REEP (Renewable Energy and Energy Efficiency Partnership), which work on other renewable sources of energy as well.
The United Nations is a partner for ISA, unlike in other organizations.
ISA is tilted more towards action rather than only scholarly research and theory building.

The Alliance wants to create a forum where an exchange of experiences can occur to deploy solar energy while agreeing that access to energy technology and finance are the biggest obstacles in achieving energy security.
In several international processes, the ultimate objective lies neglected because funds have been utilized in finding consensus in conferences. Therefore, ISA should be careful about not going on that path.
There could be disagreements on the business models like- from where to procure components and satisfying competing claims of domestic and international players could be a challenge.
Further, there is no clarity on a business model about how it can help make solar power reach “grid parity”.

India could potentially change that by making all ISA programs pointed and crisp such as the idea of linking France’s funds with PM Modi’s Smart Cities Programme to increase solar energy in public lighting in the proposed smart cities.
Funding for capacity addition should be made on a priority basis.
Successful models of a clean energy system must move away from fossil fuels (no matter how slowly) towards renewables.
Once subsidies are slowly removed from fossil fuels, that revenue should be used to subsidize renewable energy in a fashion similar to a feed-in-tariff.
The feed-in-tariff should also be eventually removed once solar prices become competitive enough, failing which the tariff becomes counter-productive and a fiscal burden.

India will be one of the largest markets and its domestic policy (to build 100 gigawatts) has sent signals to developers and financiers.
The country has committed an operational solar power capacity of 100 GW by March 2022. This initiative could be a shot in the arm for India’s energy security.

Interim Secretariat of the ISA in National Institute of Solar Energy (NISE), Gwalpahari, Gurgaon, has been inaugurated.
India has committed a corpus of 100 crores.
India will also give secretarial assistance of 225 crores for the next five years.
The government of India has offered training support for ISA member countries at NISE and also support for demonstration projects for solar home lighting, solar pumps for farmers, and other solar applications.

New ISA programmes have been launched on management of solar PV panels & battery usage waste and solar hydrogen programme.
The new Hydrogen initiative is aimed at enabling the use of solar electricity to produce hydrogen at a more affordable rate than what is available currently (USD 5 per KG), by bringing it down to USD 2 per KG.