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India Enhances Solar Module Manufacturing Incentive To $3 Billion

India has increased its incentive package for solar module manufacturing by a factor of 5, to $3 billion. 

India’s Minister for New and Renewable Energy, RK Singh, recently told media outlets that his government has enhanced the production linked incentive package for solar module manufacturing. Initially, the incentive package was worth $600 million. 

The scheme incentivizes companies to set up module manufacturing units with backward integration of up to polysilicon production. They would receive incentives on the basis of annual production and efficiency of modules. 

According to RK Singh, India has module production capacity of 8.8 gigawatts and cell production capacity of 2.5 gigawatts. No wafer and polysilicon production capacity exists in India. 

Last month the Indian Renewable Energy Development Agency (IREDA) floated a tender seeking bids from companies to set up module manufacturing units. Three companies — Adani Enterprises, Reliance New Solar Energy, and First Solar — were among those that bid to set up between 3 and 4 gigawatts of polysilicon-module production facilities each. A total of 19 companies submitted bids to set up 54.5 gigawatts of module production capacity with varying degrees of backward integration. 

Other bidders included incumbents like Tata Power Solar, Vikram Solar, Waaree Energies, Premier Energies, Emmvee Group, and Jupiter Solar. A number of power generation companies also participated in the bidding including Acme Solar, Avaada Energy, and ReNew Power. Other notable bidders include Coal India and Larsen & Toubro. 

This scheme is part of India’s efforts to achieve self-sufficiency in renewable power equipment. Around 70-80% of its wind power equipment is believed to be produced in India, but developers import around 80% of solar modules from China. This share has declined over the last couple of years due to the levy of various import duties. 

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Written By

An avid follower of latest developments in the Indian renewable energy sector.


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