Power, MNRE and Skill Development Minister R.K. Singh Shared yesterday that the government had received bids for close to 35 GW of total capacity, when it comes to solar equipment.
According to a statement given by Union power and renewable Minister RK Singh on Thursday, the government has received expressions of interest to set up manufacturing capacity of nearly 35,000 MW of solar equipment. These bids follow the inclusion of solar manufacturing in the government’s latest performance linked incentive scheme for manufacturing in India.
These bids include offers to manufacture ingots and wafers, something considered critical for control over the overall supply chain. Till now, the focus had been primarily on cell and module production, where the country is estimated to have capacities of 2 GW and 10 GW respectively.
Sharing the breakup, Mr Singh said that “We have expressions of interest for setting up manufacturing capacity for 20,000 MW of solar modules, 15,000 MW of solar cells, and a similar quantity of ingots, wafers, etc.”
Asked about the status of additional basic customs duty, Mr Singh stated that reminders had been sent to the Ministry of Finance, which is the final authority on the decision. A decision has been pending since August 2020, on the issue.
The issue is possibly getting dragged on not just due to projects that have been bid out and procurement is still on, but also due to the delay in signing PPA’s in recent projects. The ministry of finance possibly wants to avoid the issue of grandfathering clause that has been brought up regularly, in favor of a clean cut off for projects that have been awarded and placed equipment orders. Keep in mind that some of the low bids received in recent months, including the record Rs 2.39/Kw bids, are presumed on equipment import at rates prevailing at the time of the bids.
Any change now, when orders are still to be placed, will lead to an obligation to compensate the developers, or allow for a suitable increase in cost of the projects.