India Plans 1 GW Solar Power Capacity Through State-Owned Companies

Pushing forward with the plan to mandate state-owned companies to set up large-scale solar power projects, the Indian government has issued draft guidelines for the implementation of 1 GW solar photovoltaic power capacity.

An aerial view of Charanka solar park in Gujarat, India

The Indian government, through the Ministry of New and Renewable Energy, has asked public sector companies from various industrial sectors to set up a total of 1 GW solar PV capacity. Companies expected to set up the projects are from the power, coal mining, financial, and transportation sector.

The Indian government has been pushing state-owned companies to set up solar power projects with an aim to support domestic modules manufacturing companies which have fallen out of favour ever since the launch of the National Solar Mission. As per the regulations of the World Trade Organisation (WTO), any government or companies owned by it can give preference to local equipment over imported equipment.

This policy is slightly different from the other auction policies being practiced by the government to set up other large-scale projects. The public sector companies will not be required to participate in any form of competitive bidding. They, instead, can negotiate directly with power distribution companies to sign power purchase agreements at regulated rates or mutually agreed prices.

The government will offer financial support in the form of capital cost per unit size of the power plant.

All projects commissioned under this plan will be required to use solar PV modules manufactured in India. The project developers will, however, have the option to use modules manufactured using either Indian-made cells or imported cells.

Projects using modules with Indian-made solar cells will get around $160,000 to set up per megawatt of capacity. Projects using modules with imported solar cells will get around $80,000 per MW of power plant installed capacity.

The Indian government recently issued guidelines for the Indian Armed Forces to set up 300 MW solar power capacity all of which will be based on modules manufactured in India.

Image Credit: Gujarat Power Corporation Limited