Power-hungry businesses build their own solar plants

(Reuters) - Fed up with constant electricity cuts and government-enforced "power holidays", Indian IT firm ValueLabs has turned to the sun beaming down on its head office for help.

In July, it finished building a 13 megawatt solar plant - enough to power 6,000 homes - to keep the lights on and computers humming for more than 3,000 employees at its base in Hyderabad.

It is even selling surplus electricity back to the grid Commodity Trading Tips

"We plan to use the entire quantum of power generated from these plants in the coming years for our existing and upcoming campus," said Krishna Reddy, a senior ValueLabs executive.

Factories and businesses have installed over 30 MW of rooftop solar panels in the last year, data compiled by New Delhi-based consultancy Bridge To India shows. That is a small amount compared with India's solar capacity of 2,700 MW, but demand may accelerate under Prime Minister Narendra Modi who has made renewable energy a priority.

Bridge to India forecasts compound annual growth will hit more than 60 percent in the next five years, as falling panel prices make installations more alluring Intraday Trading Tips

In a sign that even big business is warming up to alternative energy sources, India's second-largest IT exporter Infosys Ltd (INFY.NS) is building a 50 MW solar plant in Karnataka to meet 30 percent of the company's power needs.

Bridge To India estimates that commercial rooftop and smaller utility plants have the potential to provide up to 83,000 MW of solar energy, more than half of India's potential solar capacity out to 2024 Stock Market Tips

"With the new government coming in, we see a clear intent to further increase allocation of solar in the energy mix," said Sujoy Ghosh, India head of U.S.-based First Solar (FSLR.O).

Along with SunEdison (SUNE.N), First Solar is among foreign panel suppliers expecting to profit from rising demand in India.

The new government is hoping to ramp up renewable energy, and wean the country off of a dependence on coal and oil and fulfil Modi's election pledge of bringing power to all.

While India's overall installed capacity has risen 20 percent in the past three years and peak-hour shortfalls have eased, not enough power reaches end-users due to rickety transmission lines, and when it does, supply is often fickle Nifty Trading Tips

Many southern states, where ValueLabs and Infosys are based, enforce power cuts to keep a check on demand. Across the country, businesses are forced to buy costly back-up generators in case of outages.

States in the arid north and west are building big solar plants at the fastest pace, though smaller commercial projects are cropping up across India, where nearly all states enjoy year-round sunshine, analysts say Free Share Tips