Softdisk Solar
Covid-19, Chinese aggression, DCR slows down commissioning : SOFTDISK

India should have crossed  atleast 45 GW of Solar Power Capacity as against 35.21GW as on end of June 2020. India need to increase Solar Power by    commissioning by nearly 65 GW to reach the capacity of 100 GW by fiscal 2022, to meet Hon. Prime Minister dream. 

India added around 20GW during 2014-18, it still falls short of the National Solar Mission target by a huge margin.

We expect an additional 45-50 GW of solar capacity addition between fiscals 2020 mid and 2022 December.  Which makes the total capacity to around 70-75 GW. Well short of Prime Ministers set target. Further the Atamanirbhar Bharat initiative making DCR compulsory for Govt. Agency partnered Companies Power plants, has certainly slowed down the coming up of Plants. Things are not easy even for reaching 70 - 75 GW.

A safeguard duty on solar modules from China and Malaysia, which was in effect  ended in 29th July 2020.

India then imposed a 20% levy on imported solar modules, cells and inverters from August 2020, replacing the current safeguard duty. Numerous local reports state the levy was proposed by Indian power minister RK Singh during a call with industry representatives, confirming that Prime Minister Narendra Modi’s government intended to impose a Basic Custom Duty (BCD) of 20% on imports.

That BCD, which comes as part of the ‘AtamaNirbhar Bharat’ initiative designed at stimulating domestic manufacturing, was replaced by another set of regulations which got effective from August 2020.

The update serves as confirmation of duties first teased within the Union budget earlier this year, which at the time set no particular time frame for the introduction of such levies. It would also seem to remove any confusion over potential exemptions for components or equipment, as were suggested a month later. 

It also comes amidst a push from India’s Ministry of New and Renewable Energy to rekindle domestic renewable manufacturing having witnessed imports struggle with logistics issues posed by the ongoing COVID-19 pandemic.

In May the government said that it had designated Solar PV Manufacturing, as well as advanced battery manufacture as 'Champion Sectors' of national self-reliance and would be supporting both with incentives.

Many of the solar plants developers have taken loans from PFC, REC, and IREDA. With BCD now being levied, there will be an extra expenditure. So, developers through NSEFI have requested extra top-up loans on the loans that have already been sanctioned LSO that they can use that to pay for these duties. We have requested the ministry to look into this.

One has to also ask for aligning the bidding guidelines with CERC connectivity regulations. In the guidelines document, the shareholding of the consortium members in the company executing the PPA should not fall below 51 per cent until one year of the commercial operational date. The CERC guidelines, amended in 2019, say that 100 per cent subsidiary companies will be allowed to transfer their connectivity and long-term access to the parent company, or vice versa. The parent company can transfer it to the subsidiary company one year after the commercial operation date is done. So, this is a conflict and therefore needs to be realigned.

MNRE is also likely to announce a proposal for merchant wind-solar projects where their power can be sold in an exchange and they might also be eligible for transmission charges and losses waiver. We have also asked MNRE to issue an advisory for selling the surplus power from RE rich states such as Tamil Nadu and Karnataka in the real-time market. This would decrease curtailment.

Another issue is that of rooftop subsidy disbursal. The rooftop solar segment has become more stressed because of the COVID-19 crisis. Most of these projects fall under MSMEs and liquidity is a huge issue. We have requested the ministry since March to disburse subsidies to them. We are hopeful that these subsidies will be disbursed this month.

 

In addition, Union Minister for Power Mr. RK Singh also confirmed that an approved list of PV manufacturers for use in government-backed solar projects would be published by the end of this year, having been pushed back from the original date of April following the onset of the pandemic. While expected, the news will come as blow to Chinese inverter manufacturers which have come to dominate India’s rooftop solar inverter market.

And more importantly the PPP negotiated with various Governments should redo and allow higher PPP. The rates such as Rs 2.44 per unit as these will never allow the 500 MW plant to recover its  money in  and 15 years time leave alone profits, by that time maintenance and reduced yield will become focus area. Already the PPA executed by Uttar Pradesh  Govt. was at 2.88 per unit.

India will not be able to achieve its ambitious target of generating 100 GW Solar Power by 2022. In a report, Softdisk research wing said that in the best-case scenario, the country will touch 65-70 GW, against the current capacity of 35.12 GW as on June 2020.

“We are more confident that projects with the Solar Energy Corp. of India (SECI) will be executed faster; their projects are better able to deal with evacuation concerns (i.e. connection to the national grid),” said Salil Chatterjee, head, Softdisk Research.

India should have crossed  atleast 45 GW of Solar Power Capacity as against 35.21GW as on end of June 2020. India needs to increase Solar Power by    commissioning by nearly 65 GW to reach the capacity of 100 GW.

Since the 2020, the rumors were on 20% imposition of BCD, states are also seeing tariffs rise. At a July auction by Uttar Pradesh for 1,000MW, the lowest bid came in at 3.48 a unit. The state cancelled these auctions. SECI also cancelled 950 MW of solar tenders in July, unhappy with the tariffs that developers were bidding.

“The government must be live with the outcome of bid price; it should go ahead with these projects even if tariffs are higher than what they like,” Salil said. “It’s hard to say which tariff is unreasonable; it’s hard to predict whether module prices will go up or down in the future. If bids are scrapped, you’ll further delay the overall program.” India is the world’s third-largest energy consumer after the US and China. Its renewable energy program is ambitious where as it stands now.

Solar PV industry analysts and project developers in India feel that imposing BCD will be a negative step in the overall goal for de-carbonizing the energy sector in India, where tremendous progress has been made in the last four years.

Levying such duties will drastically affect solar power developers and capacity addition targets set by the government of India.

We have been advocating for quite some time that there should be a level-playing field in terms of uniform taxation and levy of duty for every manufacturer in the country, including both who are inside SEZ and DTA, he lament.

Softdisk believes that if a measure promotes domestic manufacturing then we should definitely do that. When we talk about domestic manufacturing, we should also keep in mind to be independent of imports not just on modules but cells, wafers, and ingots, and device strategies to strengthen domestic supply chains for the same. Vertical integration is essential and should be definitely done.

Some reports suggest that renewable energy projects already commissioned might not be able to take advantage of the ‘grandfather clause’ to import any solar equipment from China. Since the grandfathering was announced, we have collected information of all the projects that are in the pipeline. So, we have collected information on 111 projects with 30-GW capacity in the pipeline. Immediately after the announcement came six months back, we stood up with the Government for  ‘grandfathering’ because we believe that there are still a lot of pending claims for the ‘change in law’ compensations for safeguard duty and GST from 2017 and 2018. Those compensations have not been awarded.

Recently the Minister in statement said that it is not possible to ‘grandfather’. But, we believe that grandfathering will go a long way to help developers because it will ease them from the additional burden of the safeguard duty (SGD) or basic customs duty (BCD). Secondly, even though ‘grandfathering’ is not possible then the ministry should consider a mode of compensation mechanism which would not get dragged over time and the claims by developers are compensated as early a possible.

The minister has said that it will be in line with the coal-based cess where, at present based on the increase in the coal cess or surcharge, the generators are able to claim the increase directly through the intermediary and they will get a post-facto regulatory approval. In principle it looks fine, provided it is implemented in this form where the developers can get benefit right from day one.

The reason behind it is that we have an ambitious renewable energy target and it requires a lot of capital. And when we have BCD, it is the direct equity of a company that is going into paying these additional costs. That means that this money, which was supposed to go into new projects, is going in paying these duties which is not good for our target and solar proliferation. So, there should be enough liquidity with the industry both in terms of payments receivables from the discoms as well as these compensations that come up due to certain ‘change in law' so that the industry does not suffer a cash crunch.

If it is in the interest of the country or if it is taking us in the path of energy security, while we are transitioning to new energy forms, then no one will be against such trade barriers. However, if there are no enabling policies in place for promoting domestic manufacturing, then BCD might not do enough justice for providing domestic manufacturing as they actually should.

When it comes to interest subvention, we need a level-playing field. Over the past ten years, we have been advocating for interest subvention. Second, uniform land facilitation and tax regime should be there.

More incentives should be provided for developers and large-scale plants for using domestic products because otherwise it will be very difficult to ensure demand for Indian modules. The government has also come up with domestic content requirement schemes such as KUSUM. If fully implemented, it will help uptake of about 25,000 MW domestically-made cells and modules. That is a huge demand, almost twice the module demand of our current capacity.

According to our reports the Govt.  Will be soon launching a Solar Manufacturing Facilitation Programme. This is aimed at creating a platform to bring domestic and foreign investors, and Indian industry together along with providing information related to manufacturing incentives in every state of the country. And is also designing a Research Advisory Coalition to bring Indian solar cell researchers from across the globe and India together with the domestic industry to promote high efficiency cell research and manufacturing locally. Exporting renewable power among states should be welcomed as it is a very good trend and it will come up more in RE rich states. It is a historic move by Andhra & Tamil Nadu.

On the global front, we already have the International Solar Alliance (ISA), which any country can join now, and we at Softdisk believe that the ISA and its programmes will be a good arena for taking Indian businesses into countries where we did not have any chance to penetrate.

All said and & done Softdisk believes that Govt.  should take all positive step in and help companies setup Solar Cell Manufacturing facilities on large scale.

Which States Have the Highest Solar Energy Potential in India? 

The solar energy generation potential in a specific area can be assessed based on factors like availability of land, solar radiation etc. The National Institute of Solar Energy (NISE), an apex institute of Ministry of New & Renewable Energy (MNRE), has estimated the potential of solar power in the country to be around 750 GWp. However, India has just reached an aggregate installed capacity of grid-interactive solar energy at 35.12 GW as of June, 2020.

The top ten states in terms of the estimated potential of solar power generation in India along with their installed capacity are as follows :

Rajasthan

Rajasthan clinched the top position in the list of states with the highest estimated solar energy potential in the country. It is having an aggregate solar power potential of 142.31 gigawatts (GWp). While its total installed grid-connected solar energy generation capacity stood at merely 4,844.21 MW (or 4.8 GW approx) as on March 31, 2020. In recent times, the state has moved ahead with a more aggressive solar expansion plan, ensuring it remains a key contributor to the national goal of 100 GW solar by 2022.

Jammu & Kashmir

Jammu & Kashmir (Before the bifurcation of the state into two Union Territories of J&K and Ladakh) grabbed the second-highest position in the list of states having significant estimated potential for solar energy generation in India, and its total solar energy potential is estimated at 111.05 GWp. However, the state’s aggregate installed grid-interactive solar power generation capacity remained at a very nascent stage with 19.30 MW by the end of March 2020. A huge part of this potential lies in what is now the union territory of Ladakh, with its vast open cold ‘desert’. The government is on to the opportunity, as shown by the plans for a 7.5 GW solar park on Ladakh, in the pipeline for over a year now.

Maharashtra

Maharashtra houses the third-largest potential position for estimated solar power generation capacity on pan India. Its aggregate solar power potential capacity is calculated at 64.32 GWp. Maharashtra’s total installed grid-connected solar energy generation capacity, including rooftop and ground-mounted, stood at only 1,801.80 MW (or 1.8 GW) at the end of March this year. With its high level of industrialization, this central Indian state has the potential to be a game-changer for the entire energy mix for the country.

Madhya Pradesh

Madhya Pradesh enjoyed the fourth-highest position in terms of having significant estimated potential for solar energy generation capacity in India and its total solar energy generation capacity is estimated at 61.66 GWp. While, the state’s cumulative installed grid-interactive solar power generation touched 2,258.46 MW (or over 2.2 GW) as of March 31, 2020. Madhya Pradesh has done more installations as compared to Maharashtra and Jammu & Kashmir, thanks to the progress of its massive REWA solar park. However, the state’s recent signing up for more thermal projects will definitely disappoint those expecting better things from the state.

Andhra Pradesh

Andhra Pradesh secured the fifth-largest potential for estimated solar energy generation across the country. Its aggregate solar power potential is estimated at 38.44 GWp. However, Andhra Pradesh’s total installed grid-connected solar energy generation capacity reached 3,610.02 MW (or 3.6 GW) by the March-end this year. If there were not policy-related hurdles in the recent past these numbers could be much higher.

Gujarat

Gujarat grabbed the sixth-highest position in the list of states with the highest solar energy generation potential in India. Its total potential solar energy generation capacity is calculated at 35.77 GWp. Whereas, the state’s total installed grid-interactive solar power generation capacity stood at 2,948.37 MW (or 2.9 GW) as on March 31, 2020, and represent the state with quite satisfactory numbers as compared to other higher potential states.

Himachal Pradesh

Himachal Pradesh houses the seventh-largest position for estimated potential solar power generation capacity across the country. This Hydropower rich state has an estimated solar energy potential of 33.84 GWp. That gives the state one of the best chances to be run 100 per cent on renewable energy if the will is there. However, Himachal Pradesh’s aggregate installed grid-connected solar power capacity stood at only 32.93 MW at the end of March 2020. Meanwhile, the state government is now putting in efforts to make the state as a favourite investment destination for investors.

Odisha

Odisha secured the eighth-highest position in the list of states with the highest solar energy generation potential on pan India basis and has an estimated solar power potential of 25.78 GWp. On the other hand, the state’s total installed grid-interactive solar power generation capacity stood at 397.84 MW as of March this year. Meanwhile, the Centre has put its plan on the table for the state by announcing the solarisation of Konark Sun Temple and town with 100 per cent financial assistance. Being in the relatively underdeveloped Eastern region, the mineral-rich state has a lot of catching up to do, and a solar first approach could definitely help.

Karnataka

Karnataka houses the ninth-largest estimated potential solar power generation capacity in India. Its total estimated solar energy generation capacity is close to 24.70 GWp. However, Karnataka’s cumulative installed grid-connected solar power generation capacity too grew significantly to 7,277.93 MW (or 7.27 GW) as on March 31, 2020. Karnataka has performed well in terms of installation as compared to all the other states having a higher potential of solar energy generation. The state has until recently, offered one of the better open access regimes for renewable power, which has also helped it moved ahead.

Uttar Pradesh

Uttar Pradesh secured the tenth-highest position for the estimated potential of solar energy generation capacity across the country. It’s aggregate estimated solar energy generation capacity stood at 22.83 GWp. While the state’s total installed grid-interactive solar energy capacity touched 1,095.10 MW (or nearly 1 GW) at the end of March this year. Uttar Pradesh has also picked up the pace and is targeting now over 10 GW of renewable energy capacity addition including solar in the state. The state has a tough battle ahead if it is to overcome its reputation of high potential and low actualization.

 

VIKRAM SOLAR : The company one of top names in PV Module Manufacturing signed a Memorandum of Understanding with the Government of Tamil Nadu to set up a 3 GW of solar manufacturing facility in the state. In line with the vision of Aatma Nirbhar Bharat, the company announced wafer, cell and module manufacturing set up over a period of 5 years.

SWELECT ENERGY : Being one of the leading brands in Solar PV module manufacturing in India, aims to positively move forward towards maximum solar production capacity through constant development and use of innovative technology in this field. SWELECT is also one of the few  Blooomberg TIER -1 SOLAR PV Modules manufacturers among Global companies.   The company has also got the latest certification requirements from various International Markets for new products such as higher system voltage, Fire class etc. Currently, Swelect has the largest rooftop installation by an Indian company in MW terms. Recently SWELECT launched back shield protected pv panels which are first of its kind in India.

ADANI GREEN: Adani Green Energy Ltd bagged a manufacturing-linked solar contract from the Solar Energy Corporation of India (SECI) to develop 8 GW of projects. The transaction is valued at 45,000 crore, or $6 billion. The 8 gigawatt solar energy contract that Adani Green Energy won from the government in June has propelled it to become the world’s largest solar developer by capacity. Adani, under the greenshoe option, has offered an additional capacity of 1,500 MW solar cell and module manufacturing and 6 GW of solar project development. With this, Adani’s total allocation comes to 2,000 MW of solar cell and module manufacturing and 8 GW of project capacity.Adani Green is currently the top global solar developer with 2.3 GW of operational projects, 2 GW under construction, and 8 GW of awarded projects (with contracted PPAs) for a total capacity of 12.3 GW. 

WAAREE: Waaree Energies Ltd., a leading PV module maker, headquartered at Mumbai and module manufacturing  facility in Gujarat has deployed building integrated vertical solar photovoltaic (PV) system at the Asia's Largest Rated-4 Hyperscale Datacenter CtrlS Datacenters Ltd. Waaree, which is having 2 GW of module manufacturing capacity, has installed building integrated solar panels on all 4 walls of the facility, covering more than 5,000 sq m of facade area. On the other hand, U-Solar Clean Energy has provided engineering, procurement and construction (EPC) services for the project. Further, the installed capacity of the solar plant is about 1 MW.

Tata Power: Tata Power Solar Systems Limited has 400MW of module and 300MW cell manufacturing facilities, it is fully   integrated wafer to module manufacturing facility, over 1.5 GW of our best-in-class solar modules shipped globally till date. Tata Power EPC projects of 2.6 GW commissioned till date. 260 MW of solar rooftop and distributed generation projects commissioned.

INDOSOLAR: IndoSolar Limited, a world-class manufacturing facility in India with a state of the art production lines from Germany with a capacity of 500MW of pv Cells and Modules. lndosolar Limited is under Corporate Insolvency Resolution Process and in terms of the order of the Hon’ble NCLT dated 12’th April, 2019 the powers of the Board of Directors are suspended and are vested in the Resolution Professional and lndosolar's affairs, business & assets are being managed by the Interim Resolution Professional. The Resolution Professional is performing the function as mentioned under Insolvency and Bankruptcy Code.

SD AWARDS
SD's SOLAR AWARDS 2020
SD's top 5, SPV Panel Manufacturers Capacity wise for the year ending March 2020
SD's top 5, SPCU Manufacturers of the year 2019-2020
SD's top 3, Grid Sharing Solar Power Solution Provider of the year 2019-2020
SD's top 5, Hybrid/Off-Grid Solar Power Solution Provider of the year 2019-2020
SD's top top Solar Street Lighting Solution Provider of the year 2019 - 2020
SD's UPS AWARDS
SD Awards 2020
Survey Highlights
SD's Power Electronic Industry Analysis, year ending March 2020
How They Faired
SD's Top 10
Power Electronic Companies
SD's Top 10
Indian Power Electronic Companies
SD's Top 5
Online UPS Manufacturers
SD's Top 3
Line-Interactive UPS Manufacturers
SD's Top
Home UPS/CVT/Inverter Company
Special Awards
SD's UPS SURVEY
SD's UPS Users' Choice Awards 2020
Companies to Watch
SD Users' Satisfaction Rating