Solar gear manufacturing capacity still lags demand

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Domestic solar cell and module manufacturing is way behind the country’s demand for the equipment, going by data collated by the Ministry of New and Renewable Energy (MNRE) in January end. Under the National Solar Mission, the government targets achieving an indigenous manufacturing capacity of 4-5 GW by 2020.

Till December 2016-end, the country’s installed solar cell manufacturing capacity stood at 2,953 MW, considerably higher than 1,468 MW installed on June 2016 end. However, this number includes the 1,200 MW Mundra Solar project of the Adani Group, which is yet to be commissioned.

Further, the operational capacity of solar cell manufacturing is 1,448.05 MW in December-end, marginally higher than the 1,123.05 MW in June-end last year.

The wide difference between operational and installed capacity is because of the uncommissioned Adani project being included in the list. Further, the operational capacity also takes into account the demand for these products.

As far as solar module manufacturing capacity is concerned, MNRE’s data pegs the installed capacity at 8,113 MW while operational capacity is 5,286.55 MW as on December-end. This has grown from 5,848 MW of installed capacity and 4,307.55 MW of installed capacity in June 2016-end. Here too, 1,200 MW, a major chunk of the growth is attributed to the uncommissioned Adani project.

Chinese equipment

In this backdrop, industry watchers note that a majority of solar power projects in India will continue to prefer cheaper cells and modules from China.

Narasimhan Santhanam, Co-founder, Energy Alternatives India, a renewable energy consulting and research firm, notes that domestically produced solar cells cost 37 to 39 cents while Chinese solar cells cost 29 to 30 cents.

As a result locally sourced and produced solar panels cost 60 cents while those using Chinese cells cost 50 cents each. This brings a cost difference of ₹6 per watt. Effectively, the domestically sourced and produced panels alone are dearer by ₹60-₹65 lakh per MW.

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