According to reports, the government has rebuffed the pleas of the domestic manufacturers of solar cells and modules to protect them from a flood of imports. The renewable energy ministry plans to give local players only a small part of the projects to be awarded in the next phase of the solar mission.
“Solar power projects using imported equipment are more cost-viable than those using domestic content,” said Tarun Kapoor, joint secretary, MNRE.
By end of May, government will tender solar photovoltaic power projects worth 750 MW for competitive bidding. Senior officials at the ministry said that it’s likely that a mere 200-250 MW will be kept separate to be built from domestic solar equipment. The balance will be free to procure imported content.
“Keeping in view the financiers and diminutive capacity of the domestic manufacturing, it was opined that the share of non-domestic should be larger,” said a senior official at Solar Energy Corporation of India (SECI). SECI is the newly formed subsidiary of MNRE, which will steer the second phase of the national solar mission. Domestic manufacturers of solar cells and modules have been condemning the government for not supporting the industry, which is incurring a huge annual loss of 10,000 crore and is on the verge of shutdown.
The current capacity of Indian solar manufacturing is roughly 1,000 MW of cells and 2,000 MW of modules.
Most of the units including that of Moser Baer, Lanco and Tata Solar have shut down their manufacturing capacity.
Amount of exports of solar cells and modules increased from 920 MW in 2011 to 1,050 MW in 2012.
The landed price of imported solar cells in India has come down substantially from $1.32 per watt-peak in 2010 to 36 cents per watt-peak in 2012.
“We are also selling at this global price (36 cents/watt-peak) but this is way below our variable costs. We can match the quality but not the price and this has led to manufacturing facilities closing down,” said S Venkataramani, general secretary, Indian Solar Manufacturers’ Association.