Unlike traditional energy and much like technology, clean energy offers an opportunity for entrepreneurs to play a significant role in contributing to the Indian economy. From a macroeconomic standpoint, clean energy offers an opportunity for India to create manufacturing and infrastructure jobs, potentially many times more than the few lakh jobs created by the technology sector in the late 1990s. The keys to unlocking this entrepreneurship opportunity are to understand the unique demand drivers of this sector, and to de-risk the challenges by building a diverse team that has local operational expertise and global technological leadership.

The demand drivers for clean energy in India are very different from those in the U.S. The thrust comes not from a need to stop climate change, but primarily from a need to build an energy secure future. The investment commission of India claims an average supply demand gap of 9 percent and peak gap of 14 percent. During a late monsoon season, much like the most recent one, acute electricity shortages are present in those parts of the country dependent on hydro power. Ultra mega coal plants and imported oil & gas cannot solve all the problems. Recognizing this, the central government has set a 20GW solar target by 2020 under the national solar mission.

We, at General Catalyst Partners, anticipated this need in 2007 and started Sunborne Energy to build world-class solar power plants in India. To make this venture work effectively, we teamed up with principal scientists from University of Southern Florida who had state-of-the-art technological leadership and senior business executives in India who brought in the best local operational expertise. This combination allows us to leverage on the best technologies from the west and commercialize those in India. What we have learnt is that indigenization of technologies is important and India is a great place for this. A lower cost supply chain gives anywhere between a quarter and a third lower costs just off the bat. The final ingredient to success is a strong involvement in policy at the state and federal levels. Just like the IT revolution gave rise to Indian MNC firms like Infosys, Wipro and TCS, we hope the new initiatives in solar energy will create global leaders in India.

The unique thing about clean energy is that businesses of different scales can be created. Localized microgrids can be built with a few crores of rupees whereas a 100 MW solar plant can cost a few thousand crores. We see many startups in India that aim to work on varied problems like LED lighting solutions, solar lanterns, solar PV manufacturers, waste-to-energy power producers, smart grid deployment, distributed generation and recycled organics, etc. We also see huge opportunities to build capital light startups in energy efficiency services and microgrids management. Energy losses in India are among the highest in the world and large parts of India are still not grid connected. Water is another interesting space that could provide a windfall to entrepreneurs if played well at the right time.

Great teams create great companies. Being trained in entrepreneurship in the U.S. gives one an inherent advantage. But it is imperative to complement this with knowledge transfer, localization of manufacturing and most importantly, an extremely strong local operational expertise to build a winning team.