Mercom India held a 90-minute webinar to discuss and analyze the latest developments, policy updates and future forecasts for the solar industry in India.
Panelists included Dilip Nigam, an adviser to the Ministry of New and Renewable Energy (MNRE), and Shailesh Kumar Mishra, director of the Indian Solar Corporation (SECI). The webinar was chaired by Raj Prabhu, chief executive of Mecon Capital Group, and Priya Sanjay, managing director of Mecon India.
Important elements of the discussion:
1. The challenges in the field of solar energy.
Shailesh Kumar Mishra, head of SECI, said in a wes seminar that there were two major challenges earlier - high tariffs and grid stability. Over the past decade, the former has been resolved as tariffs have fallen sharply.
"One of the biggest challenges right now is to keep the grid stable. We are now working on the spread of renewable energy, and MNRE is promoting a solar-wind hybrid power generation project. There are several 24-hour renewable energy tenders. We are also committed to solar energy projects tied to thermal energy. Intermittently, however, is a problem, but we have been working hard to develop. "
Another important issue is land expropriation and electricity transmission. Kumar Mishra said: "In terms of land, MNRE has proposed a new model under the solar power scheme, with the state government as a partner and public sector units playing a leading role. They can develop projects independently or jointly with the state government. The primary role of the State Government is to provide land clearing to facilitate access to land. "
2. Low installation.
COVID-19 has severely affected India's solar industry, with a sharp decline in installations, mainly due to supply chain disruptions and a lack of labor for project development. The second half of the year remains challenging as projects are likely to move on to the following year, and the industry is struggling to recover from the disruption.
MNRE consultant Dilip Nigam said, "Because of COVID-19, the labor force has moved, so work has not only slowed down but stopped completely." In view of this situation, MNRE has ordered that all projects be extended for five months from the scheduled commissioning date. This is related not only to solar projects but also to the transmission and all other related activities. By the time things ease, we expect the third and fourth quarters to be better than we expected. "
3. Basic tariffs and safeguard taxes.
Nigam points out that basic tariffs and safeguard taxes are tools to curb imports and encourage Indian companies to be self-seismic.
"Now that the tax has been extended for another year, it will help to some extent to curb imports. We also propose a phased collection of basic tariffs, which are currently under consideration by the Ministry of Finance and the Ministry of Commerce and have yet to be announced. Once implemented, it will also encourage domestic manufacturing," he added.
He added: "We have proposed a basic tariff of 25 percent - higher tariffs on components and lower tariffs on solar cells." It will be implemented immediately after the end of the safeguards liability period on 29 July 2020. However, for a variety of reasons, it has neither been announced nor withdrawn. We are providing the necessary input in this regard to the Ministry of Finance. "
4. Self-setting during COVID-19.
During India's blockade phase, the Prime Minister stressed the need for self-empty. Nigam explains that this part falls within the scope of MNRE in terms of self-reliance in the manufacture of solar modules and batteries.
"In 2010, India imported nearly 90 percent of all solar equipment, especially from one country, which we actively tried to avoid," Nigam said. Over the past decade, we have made various efforts to change the status quo. "
Nigam added that programs such as the Central Public Sector Program (CPSU) and the Pradhan Mantri Kisan Urja Suraksha Even Utthan Mahabhiyan (PM KUSUM) program have made it mandatory to make home-grown solar cells and panels.
"We are also considering providing some capital incentives to the manufacturing sector in India, " says Nigam. "
Nigam believes COVID-19 has also helped India's renewable energy sector, "because of a change in global political attitudes, investors are more interested in setting up a production base in India than in a particular country." Many Indian private companies are setting up joint ventures with foreign companies and plan to set up their own divisions in India. These will help the Atmanirbhar program. "
5. The state power distribution company refuses to approve the open-end project.
The Andra government's decision to renegotiate the electricity purchase agreement has caused a stir among the state's stakeholders and set a bad precedent for other states. Also in Haryana, open-plan solar projects are in trouble. The state power distribution company denied signing the connection agreement and approving long-term open access (LTOA) for solar power parks and projects, and state-invested developers have sought help from the Ministry of Railways to address the issue. Nigam made it clear that MNRE was not the leader in addressing the issue head-on.
MNRE has been trying at the highest level until the Prime Minister talks with the Andra government. However, the states still have the right to make decisions in this regard, and the Andra issue is different from haryana, and we are concerned that the Andra issue may have a ripple effect, but in the case of Haryana, we are in communication with them and we will discuss it at the next meeting with them.
6. Approved models and manufacturers list (ALMM) delay.
"Due to COVID-19 restrictions, ALMM was consciously delayed until October, and manufacturers shared their concerns and difficulties with us," Nigam said. The Ministry had established a committee under the leadership of the new Secretary to investigate those issues. "
Nigam added: "It has been decided that ALMM orders apply only to bids made within 30 days of the announcement. Projects in preparation prior to the announcement will not be affected and 30 days is sufficient for the tenderer to take into account the cost of ALMM when bidding. "
7. 7.5GW solar energy project in Ladakh.
The tender was originally announced with a clause that developers of solar projects must also build transmission infrastructure. But after extensive feedback, Misra said the government has now decided to separate the tenders for transmission and project development and to build transmission infrastructure before the project is developed, which is expected to result in competitive tariffs. He added that the government had been working on the plan and was re-focusing on it. After Rajasthan and Gujarat, Radak is expected to become India's next major renewable energy hub.
