The US International Trade Commission’s (USITC) determination on Friday that cheap imports (primarily from China) of photovoltaic (PV) modules are hurting United States’ manufacturers is set to make life even harder for Indian solar firms, already struggling with high prices in an import-dependent market. According to analysts and industry players, the panel’s findings are set to kick-off a buying spree among US developers to buy as much stock as they can before the panel makes a recommendation to restrict such imports. The 4-0 vote by the International Trade Commission sets up a two-month review period in which the panel must recommend a remedy to US President Donald Trump.
According to a report from industry tracker Bridge to India, the country’s top three solar module suppliers are Chinese. “There has been a marginal increase in the market share of Indian manufacturers but the Chinese suppliers continue to hold over 80 per cent of the total market share,” said the report. In fact, ratings agency ICRA observed earlier this month that this was due to both factors. “… this rise is due to… advancement of module sourcing from China by companies in the US in anticipation of imposition of anti-dumping duty… and extension of feed-in tariff regime for solar power projects in China till September 2017, thereby increasing demand,” said Sabyasachi Majumdar, senior vice-president and group head, ICRA Ratings.
According to ICRA, imported PV module prices have been rising over the past 3-4 months, by as much as 15 per cent. “Such pricing pressure, if sustained over the next 3-6 months, will adversely impact the viability of recently bid solar power projects, where bid tariff is below `3.5 per unit,” Majumdar had observed. A six cent per watt jump in PV module prices are estimated to increase capital costs by as much as 11 per cent.