Category: Blogs

India starts review phase on technology-selection for multi-GW of new cell and module facilities

Following recent announcements from the government departments administering India’s solar PV growth ambitions, the country is now in the process of working out how to expand its domestic upstream manufacturing capacity, at a time when the PV industry is going through a period of rapid technology-change and supplier competition.

Having been through various (albeit at reduced levels) manufacturing capacity expansion phases over the past couple of decades, it really is crunch time for prudent decision-making across both domestic and overseas investors, seeking to move India finally to manufacturing powerhouse status.

The article discusses the opportunity and challenges involved for India to realize the addition of 5-10 GW of new cell and module manufacturing capacity, now being spelled out through a combination of domestic content requirement (DCR) and manufacturing-linked supply-arrangements designed specifically to create a risk-free sales pipeline to stimulate multi-GW levels of annual cell and module production within India.

The timing of the government-body announcements over the past few months is particularly relevant to PV-Tech’s inaugural PV IndiaTech 2019 conference that takes place in Delhi on 24-25 April 2019. This article previews the conference themes, companies lined up to speak, and how such an event has the potential of educating not just the entire Indian solar segment, but also overseas investors and manufacturing/technology suppliers that are lining up to benefit from the capex uptick from 2020 onwards.

Understanding the drivers for Make-in-India PV manufacturing

India has a heritage in solar cell manufacturing that predates the first major industry growth phase, and well before the days of GW-level global end-market deployment. Government-owned and domestic-run conglomerates such as Bharat Heavy Electricals Limited and Tata epitomised early PV fervour: the JV cell facility operated by Tata BP Solar in Bangalore was at the time one of the most eagerly-tracked manufacturing sites of global industry observers.

Indeed, anyone glancing at MNRE’s compendium of cell producing companies in recent years can see almost all of the early cell manufacturing advocates still listed, despite the fact that very few are running lines today in any competitive manner.

Two other mini expansions booms have occurred within India during the past 15 years. The first one (dating back to before 2010) was stimulated by the goal of exporting cells to module producers outside India. The second phase was prompted by the National Solar Mission’s stimulus in domestic module supply to installers and EPCs, and was accompanied by the market-entry of pure-play module producers, some of whom expanded to the GW-level.

Few, if any, within India, would be bold enough to assign these investment phases as being successful. The reality that unfolded saw a vibrant end-market dominated by Chinese and Southeast Asia produced modules flooding into the country, almost regardless of nominal import duties that were contemplated in order to artificially inflate domestic cell and modules sales prices.

The two major rounds of capacity expansions have also seen different subsets of production equipment suppliers benefiting from the spending cycles. The earlier expansion phase was characterized by turn-key lines being supplied to the country. The more recent phase saw specific European (mainly German and Italian) and Chinese tool suppliers being chosen, almost in a carbon-copy manner across different companies/facilities, with much of the technology advice again coming from European (German) origins, akin to a remote turn-key design/consultancy service.

Virtually everything installed during these phases, and in particular the most recent phase, was unfortunately based upon Al-BSF p-multi cells, at a time when the signs were clear within China that billions was being invested into mono and PERC. Fast-forward to today – and aside from any other cost/performance benefits associated with Chinese manufacturers – India now has several cell fabs using yesterday’s technology choice. Part of Adani’s GW expansion was afforded to mono, and these lines can be regarded today as the most advanced across the whole of India.

It is highly unlikely that the same approach to expansions will be adopted within India when things start anew from 2020 onwards. Indeed, the entire way that investors assess factory cost and technology metrics has to move from passive-caution to informed-progression; being much more educated about solar manufacturing trends is simply a must if India is to succeed third-time around in creating multi-GW of viable cell factories.

Benchmarking and reality-checking is an essential start-point

It may seem obvious that any investor seeking to formulate a new multi-billion dollar investment should undertake good sector benchmarking, but the solar industry is littered with investments that have been done on the back of fact-devoid hype and through wholly misunderstanding the gap between R&D results and GW factory operations.

A similar narrative can also be assigned to investments that have stoically followed the status-quo of the day, by merely adding more mainstream technology, but in a different country (as India did exactly in its last expansion phase). It is not necessary to be a technology expert, but thinking that copying the current mainstream offering today – and taking 2 years to build a factory – will result in anything other than tears is simply naïve.

India’s new expansion aspirations come at a fascinating point in PV technology change, with the industry having shifted from 80% p-multi Al-BSF cell production to 60% p-mono PERC (with optional bifaciality) in rapid time. Huge investments are pouring into n-type technologies, with many voices suggesting that existing p-mono producers need to adapt to n-type production with passivated contacting at the rear. Others are pushing the adoption of heterojunction lines, if full differentiation is needed, and especially if the expansion is linked to greenfield projects, often the case with new market-entrants.

Even among the multi-GW cell producers of today, there is much debate, with few willing to commit fully to just one technology in the near-to-mid-term. Of course, each has a strong preference, and the market today has only just shifted to p-mono PERC being the mainstream technology offering.

This is entirely a new landscape for investors to absorb, and has evolved very quickly in just 12-18 months. Good due-diligence while having some kind of flexible technology route is perhaps the most sound advice that can be offered within the India context today. For others, simply having an exit strategy to avoid throwing good money after bad may be the most prudent strategy.

PV IndiaTech 2019 has been refocused to help decision-making within India

As the announcements have come out from government departments over the past few months, we have received increased levels of requests from the industry about focusing the scope and content of our inaugural PV IndiaTech 2019 event on addressing many of the questions raised earlier within this article.

Many have cited the need for a substantially higher level of awareness and knowledge from the new types of organizations and institutions that are currently hoping to benefit in the post-DCR world from 2020 onwards. What is state-of-the-art today for cell and module production costs and efficiencies? How flexible does production need to be for multi/mono and mono/bifacial? Is it essential to move direct to n-type or can a viable cell/module business be effected today with p-mono bifacial module supply?
And behind all this also is the need to understand the role of materials used in cell/module assembly, such as glass, backsheets, etc., and what is needed by way of test/inspection, certification and bankability due-diligence.

Clearly, a range of domestic and overseas companies from wafer-supply to module-testing fall into the target group of key stakeholders set to attend PV IndiaTech 2019. However, two other groupings need to both hear and feed into all the suggestions on how India needs to spend its money on building the multi-GW of new cell/module factories from 2020 onwards.

The first is everything-governmental, as perhaps the institution with most to win (and most to lose) through erroneous technology and supplier selection. The other massive input however comes from project developers, EPCs, O&Ms, portfolio owners, and asset managers. Like-it-or-not, these parties are going to have to get accustomed to site builds and ROI analysis, where a significant part of the owned/operated assets is coming from domestic-produced cells/modules. Those sitting with a near-100% portfolio of assets using low-cost, low-grade (by China standards) 72-cell p-multi modules are the ones with most to learn, and hopefully to benefit from if all goes to plan!

Agenda for PV IndiaTech 2019

More detailed information on confirmed speakers, partnering companies and other features happening at PV IndiaTech 2019 can be found at the event website here.

The two-day event includes 11 sessions, with 3-4 companies speaking within each session. The session titles are shown here now:

• Understanding India’s PV competitiveness through investment & foreign company participation
• Benchmarking how India becomes a PV powerhouse: state-of-the-art practices by global leaders
• Growing the domestic sector: Make-in-India as a global gold-standard in the PV industry
• Test & inspection, certification of bankability metrics for modules deployed within India
• Identifying the barriers for Indian PV manufacturing competitiveness
• Overseas technology-transfer: research labs driving high-efficiency & low-cost PV manufacturing
• Maximizing PV return-on-investment through components, materials supply & BoS optimization
• Production equipment & materials supply to Indian PV cell & module fabs
• Market-competitive & next-generation manufacturing technologies
• How do project developers, EPCs & investors operate effectively in a post-DCR landscape
• Returning value to the banks & investors: the importance of qualified O&M and asset management

There are still a few remaining speaking and partnering slots available for the event, and anyone interested should get in touch with us ASAP using the contact routes here.

An allocation of exclusive partner/organized VIP tickets has also been created, to ensure the event has the perfect mix of guest participants. Interested parties falling within this category should also get in touch with us as soon as possible.

Similar to our PV CellTech and PV ModuleTech events, the conference will be covered on our PV-Tech web portal. Much more to follow from myself and others in the team leading up to, and after the event.
 

India starts review phase on technology-selection for multi-GW of new cell and module facilities

Following recent announcements from the government departments administering India’s solar PV growth ambitions, the country is now in the process of working out how to expand its domestic upstream manufacturing capacity, at a time when the PV industry is going through a period of rapid technology-change and supplier competition.

Having been through various (albeit at reduced levels) manufacturing capacity expansion phases over the past couple of decades, it really is crunch time for prudent decision-making across both domestic and overseas investors, seeking to move India finally to manufacturing powerhouse status.

The article discusses the opportunity and challenges involved for India to realize the addition of 5-10 GW of new cell and module manufacturing capacity, now being spelled out through a combination of domestic content requirement (DCR) and manufacturing-linked supply-arrangements designed specifically to create a risk-free sales pipeline to stimulate multi-GW levels of annual cell and module production within India.

The timing of the government-body announcements over the past few months is particularly relevant to PV-Tech’s inaugural PV IndiaTech 2019 conference that takes place in Delhi on 24-25 April 2019. This article previews the conference themes, companies lined up to speak, and how such an event has the potential of educating not just the entire Indian solar segment, but also overseas investors and manufacturing/technology suppliers that are lining up to benefit from the capex uptick from 2020 onwards.

Understanding the drivers for Make-in-India PV manufacturing

India has a heritage in solar cell manufacturing that predates the first major industry growth phase, and well before the days of GW-level global end-market deployment. Government-owned and domestic-run conglomerates such as Bharat Heavy Electricals Limited and Tata epitomised early PV fervour: the JV cell facility operated by Tata BP Solar in Bangalore was at the time one of the most eagerly-tracked manufacturing sites of global industry observers.

Indeed, anyone glancing at MNRE’s compendium of cell producing companies in recent years can see almost all of the early cell manufacturing advocates still listed, despite the fact that very few are running lines today in any competitive manner.

Two other mini expansions booms have occurred within India during the past 15 years. The first one (dating back to before 2010) was stimulated by the goal of exporting cells to module producers outside India. The second phase was prompted by the National Solar Mission’s stimulus in domestic module supply to installers and EPCs, and was accompanied by the market-entry of pure-play module producers, some of whom expanded to the GW-level.

Few, if any, within India, would be bold enough to assign these investment phases as being successful. The reality that unfolded saw a vibrant end-market dominated by Chinese and Southeast Asia produced modules flooding into the country, almost regardless of nominal import duties that were contemplated in order to artificially inflate domestic cell and modules sales prices.

The two major rounds of capacity expansions have also seen different subsets of production equipment suppliers benefiting from the spending cycles. The earlier expansion phase was characterized by turn-key lines being supplied to the country. The more recent phase saw specific European (mainly German and Italian) and Chinese tool suppliers being chosen, almost in a carbon-copy manner across different companies/facilities, with much of the technology advice again coming from European (German) origins, akin to a remote turn-key design/consultancy service.

Virtually everything installed during these phases, and in particular the most recent phase, was unfortunately based upon Al-BSF p-multi cells, at a time when the signs were clear within China that billions was being invested into mono and PERC. Fast-forward to today – and aside from any other cost/performance benefits associated with Chinese manufacturers – India now has several cell fabs using yesterday’s technology choice. Part of Adani’s GW expansion was afforded to mono, and these lines can be regarded today as the most advanced across the whole of India.

It is highly unlikely that the same approach to expansions will be adopted within India when things start anew from 2020 onwards. Indeed, the entire way that investors assess factory cost and technology metrics has to move from passive-caution to informed-progression; being much more educated about solar manufacturing trends is simply a must if India is to succeed third-time around in creating multi-GW of viable cell factories.

Benchmarking and reality-checking is an essential start-point

It may seem obvious that any investor seeking to formulate a new multi-billion dollar investment should undertake good sector benchmarking, but the solar industry is littered with investments that have been done on the back of fact-devoid hype and through wholly misunderstanding the gap between R&D results and GW factory operations.

A similar narrative can also be assigned to investments that have stoically followed the status-quo of the day, by merely adding more mainstream technology, but in a different country (as India did exactly in its last expansion phase). It is not necessary to be a technology expert, but thinking that copying the current mainstream offering today – and taking 2 years to build a factory – will result in anything other than tears is simply naïve.

India’s new expansion aspirations come at a fascinating point in PV technology change, with the industry having shifted from 80% p-multi Al-BSF cell production to 60% p-mono PERC (with optional bifaciality) in rapid time. Huge investments are pouring into n-type technologies, with many voices suggesting that existing p-mono producers need to adapt to n-type production with passivated contacting at the rear. Others are pushing the adoption of heterojunction lines, if full differentiation is needed, and especially if the expansion is linked to greenfield projects, often the case with new market-entrants.

Even among the multi-GW cell producers of today, there is much debate, with few willing to commit fully to just one technology in the near-to-mid-term. Of course, each has a strong preference, and the market today has only just shifted to p-mono PERC being the mainstream technology offering.

This is entirely a new landscape for investors to absorb, and has evolved very quickly in just 12-18 months. Good due-diligence while having some kind of flexible technology route is perhaps the most sound advice that can be offered within the India context today. For others, simply having an exit strategy to avoid throwing good money after bad may be the most prudent strategy.

PV IndiaTech 2019 has been refocused to help decision-making within India

As the announcements have come out from government departments over the past few months, we have received increased levels of requests from the industry about focusing the scope and content of our inaugural PV IndiaTech 2019 event on addressing many of the questions raised earlier within this article.

Many have cited the need for a substantially higher level of awareness and knowledge from the new types of organizations and institutions that are currently hoping to benefit in the post-DCR world from 2020 onwards. What is state-of-the-art today for cell and module production costs and efficiencies? How flexible does production need to be for multi/mono and mono/bifacial? Is it essential to move direct to n-type or can a viable cell/module business be effected today with p-mono bifacial module supply?
And behind all this also is the need to understand the role of materials used in cell/module assembly, such as glass, backsheets, etc., and what is needed by way of test/inspection, certification and bankability due-diligence.

Clearly, a range of domestic and overseas companies from wafer-supply to module-testing fall into the target group of key stakeholders set to attend PV IndiaTech 2019. However, two other groupings need to both hear and feed into all the suggestions on how India needs to spend its money on building the multi-GW of new cell/module factories from 2020 onwards.

The first is everything-governmental, as perhaps the institution with most to win (and most to lose) through erroneous technology and supplier selection. The other massive input however comes from project developers, EPCs, O&Ms, portfolio owners, and asset managers. Like-it-or-not, these parties are going to have to get accustomed to site builds and ROI analysis, where a significant part of the owned/operated assets is coming from domestic-produced cells/modules. Those sitting with a near-100% portfolio of assets using low-cost, low-grade (by China standards) 72-cell p-multi modules are the ones with most to learn, and hopefully to benefit from if all goes to plan!

Agenda for PV IndiaTech 2019

More detailed information on confirmed speakers, partnering companies and other features happening at PV IndiaTech 2019 can be found at the event website here.

The two-day event includes 11 sessions, with 3-4 companies speaking within each session. The session titles are shown here now:

• Understanding India’s PV competitiveness through investment & foreign company participation
• Benchmarking how India becomes a PV powerhouse: state-of-the-art practices by global leaders
• Growing the domestic sector: Make-in-India as a global gold-standard in the PV industry
• Test & inspection, certification of bankability metrics for modules deployed within India
• Identifying the barriers for Indian PV manufacturing competitiveness
• Overseas technology-transfer: research labs driving high-efficiency & low-cost PV manufacturing
• Maximizing PV return-on-investment through components, materials supply & BoS optimization
• Production equipment & materials supply to Indian PV cell & module fabs
• Market-competitive & next-generation manufacturing technologies
• How do project developers, EPCs & investors operate effectively in a post-DCR landscape
• Returning value to the banks & investors: the importance of qualified O&M and asset management

There are still a few remaining speaking and partnering slots available for the event, and anyone interested should get in touch with us ASAP using the contact routes here.

An allocation of exclusive partner/organized VIP tickets has also been created, to ensure the event has the perfect mix of guest participants. Interested parties falling within this category should also get in touch with us as soon as possible.

Similar to our PV CellTech and PV ModuleTech events, the conference will be covered on our PV-Tech web portal. Much more to follow from myself and others in the team leading up to, and after the event.
 

Energy storage in India: A ‘year of action’ lies ahead of us

Dr Rahul Walawalkar by now probably needs little introduction for our readers. It’s been a little while since his last Guest Blog for the site, but Dr Walawalkar has weighed in with commentaries, views and invaluable background information and insights through interviews and news stories, mostly in his capacity as executive director of the India Energy Storage Alliance (IESA). Since the end of last year, he is also the chair of the Global Energy Storage Alliance (GESA). In his day-to-day role, Walawalkar leads the Emerging Technologies & Markets team at Customized Energy Solutions.

We asked Rahul three simple questions to illuminate what was achieved in 2018 and what held the market back, if anything. We also look ahead to this year and what we might expect to see.

What were the biggest achievements in India in 2018 in energy storage and related areas like electric vehicles or solar and wind?

The year 2018 saw some great action and witnessed the kick-start of some large-scale deployments of energy storage technologies in the country. The government is also trying to push incentives for domestic manufacturing of lithium-ion batteries, thus reducing their import and dependence on China. It is thanks to telecom and related sector applications that the distributed advanced storage deployment in the country has already crossed the 2GWh benchmark.

During the first half of the year, India installed 4.9 GW of solar power and secured the position of the second largest solar market in the world. The country will soon become the global solar hub with some of the largest solar parks in the world as Government has approved plans for 14 solar parks as part of National Solar Mission of reaching 100 GW solar by 2022.

The Indian government has announced achieving 100% village electrification earlier this year and is now aiming for 100% household electrification with in next couple of years. According to the MOP, 15 states in India have achieved 100% household electrification under Pradhan Mantri Sahaj Bijli Har Ghar Yojna (SAUBHAGYA) program so far.  

The EV market is also gaining momentum in India due to the ambitious plans and initiatives of the government. In early 2018, the Ministry of Power launched the new National Electric Mobility Programme to focus on creating the charging infrastructure and a policy framework to set a target of more than 30% electric vehicles by 2030.

According to the MNRE (Ministry of New and Renewable Energy), India will add 227GW of renewable energy capacity by March 2022, which is going to improve India’s ranking, making it one of the top three countries making investments in the sector. Meanwhile, India has played a significant role in setting up of the International Solar Alliance. The government is making sincere efforts and progress toward alternative energy and the past year has been very progressive. Still, a lot needs to be achieved in the area of energy storage.

What specific initiatives was the India Energy Storage Alliance (IESA) able to undertake in 2018 and what were some of the group’s successes?

IESA’s vision is to make India a global leader in energy storage, electric vehicle and micro-grid technology adoption and a hub for manufacturing of these emerging technologies by 2022. We’re creating awareness among various stakeholders in the industry by promoting an information exchange with end users.

In February 2018, the MNRE convened to draft the National Energy Storage Mission to provide the policy framework necessary [to support the] industry. I was the part of the expert committee representing IESA to draft the National Energy Storage Mission which was of the major achievements – not only for us but also for the whole industry. The NESM draft is currently awaiting final approval from Cabinet and PMO and is expected to get announced during this month, January 2019.

IESA also brought leading voices together to advocate for a cut to GST (Goods and Services Tax, a single tax applicable across the whole of the country) rates for energy storage in India which is now 18% down from 28%. IESA had sent several letters to GST council earlier on this reduction and also met the concerned ministry officials on different occasions. The further reduction of GST to 5% – similar to solar components – or to 12% (similar to the electric vehicle) is essential to boost energy storage adoption in India.

During 2018, IESA also held a number of other successful events. We hosted a meet in Coimbatore and Pune for fast-tracking the adoption of behind-the-meter advanced energy storage technologies. Attended by over 80 large Commercial and Industrial (C&I) consumers as well as 50+ IESA member companies actively looking to provide solutions, the objective was to provide appropriate energy storage solutions for C&I consumers. We also hosted a ‘masterclass’ on energy storage tech, applications and manufacturing with the Indian Electrical & Electronics Manufacturers Association (IEEMA), an EV event looking at policy, battery tech and charging infrastructure.

IESA also hosted the second edition of India’s Energy Storage Policy Forum on the eve of World Energy Storage Day, focused on policy issues related to grid and off-grid applications to support renewable development, energy storage for EVs and charging infrastructure, as well as R&D and the manufacturing ecosystem in India. We received an overwhelming response from stakeholders and policy makers.

Finally, in receiving the chairmanship of the Global Energy Storage Alliance, India currently has the leadership of global alliances in solar, smart grid and energy storage. It’s a testament to the growing importance of India in the global energy sector.

What’s the way forward in 2019? What can be achieved and what might hold energy storage back?

Energy storage can play an important role in renewable integration, energy access, electric mobility and smart cities initiatives by the Government. IESA estimates the market for energy storage will grow to over 300GWh during the years 2018 to 2025. India is expected to attract investment in up to four ‘Gigafactories’ for advanced Li-ion batteries, attracting over US$3Billion in investments in the next 3 years.

We expect 2019 to be a year of opportunities for energy storage sector especially in terms of manufacturing, assembling, energy storage project developments, equipment supply, R&D of technology enhancement etc. More and more foreign as well as Indian technology players are going to explore this sector in the coming years. 

In India, with the ever-rising fossil fuel imports and rapid urbanisation choking many cities with harmful pollution, the need for adoption of clean energy became more of a compulsion than a choice.

India is moving rapidly towards renewable energy (RE) and e-mobility. With the government moving on top gear to reach the 2022 RE goals, RE capacity would rise to 25% of the total and grid instability will become a real issue.

Energy storage is central to the successful growth of renewable energy and EVs. The government of India is fully aware of this and is putting in place the Electrical Energy Storage Mission. In the next few years, a lot of movement and rapid change in the market is expected.

It is high time for policymakers to take decisive action if India is to really tap into the estimated 300GWh opportunity for domestic manufacturing over the next four years. Electric vehicles, behind-the-meter and grid-scale energy storage are key applications to help the Indian government meet wind and solar targets as well as meeting the energy access goals.

However, cost can be seen as one factor derailing the rapid adoption of energy storage. We also still need the removal of barriers such as the higher rate of GST (18% for batteries versus 5% for solar) and import duties in order to kick start the advanced energy storage market in India.

The government of India also has a goal of at least 30% of its vehicles running on electric by 2030. If we can have sufficient public charging facilities which can be used for charging EVs during the day, then this can actually solve a problem of low net loads during the times when maximum solar energy is being produced.

In conclusion, with the impending launch of the National Energy Storage Mission, we expect 2019 to be a year of action rather than a year of mere discussions and promises. Over the past two to three years, we have received a number of mixed signals from policy makers that have prevented major investments to flow in India for the energy storage sector. Still we have a wonderful opportunity to tap investments and fuel innovation with domestic ingenuity and global partnerships.

Himalayan solar to the plains of Punjab: Assessing 23GW in Ladakh

Ladakh is one of the most inaccessible places on earth. Cut off by snow for more than seven months of the year, deep into the Indian Himalayas and bordering both Pakistan and China, with its capital city Leh at 3,500 metres altitude, this corner of Jammu & Kashmir state makes any kind of large-scale infrastructure a daunting prospect. Just ask the Indian Border Roads Organisation what it is like to battle avalanches, glacier melts and mudslides across several of the highest motorable passes in the world. Making up for its access issues, however, Ladakh also has perhaps the best conditions for solar power in the whole of India; dry and cold with unblemished blue skies. With its recent 10GW of solar linked with PV manufacturing tender somewhat of a damp squib, India’s Ministry of New and Renewable Energy is under pressure to get the wheels moving again to meet the demands of a vast number of interested investors who piled into the solar space in the last three years and come closer to the 100GW by 2022 target. Although major Ladakh PV plans have been touted in the past, MNRE has now said it wants to bring out a 7.5GW tender by 15 December on the march to an overall 23GW target in the region.

The plans are still tentative with both the locations of the first 5GW and 2.5GW solar zones as well as the substations still under discussion by Solar Energy Corporation of India (SECI), MNRE and Indian PV players. Last week, a spokesperson for SECI told PV Tech that it envisions project developers entering into joint ventures with transmission line developers to evacuate the power into more power hungry regions in Kashmir and North India, but he stressed that tender documents have not been finalised. If the government stays true to SECI’s original announcement then we should have the final tender issued this week.

As it stands, Phase-I would include 2.5GW of solar in Zangla region of Kargil with a transmission line to be built all the way to New Wanpoh in Kashmir, which is south of the capital Srinagar. The remaining 5GW of PV would be set up in the Pang region of Leh district with the transmission line to be built across a colossal distance to Hisar in Haryana to the northwest of New Delhi.

Extreme solar

Let’s start with the positives: the conditions of Ladakh are nigh on perfect for solar module performance, with clear blue skies throughout much of the year, with high altitude giving strong irradiation. The altitude also keeps temperatures cool and there’s little humidity even in mid-summer. However, the temperatures do drop to extreme and icy lows, making Ladakh worthy of its nickname ‘Little Tibet’. There also more unique issues highlighted in our ’Engineer’s view’ later in this article.

PV IndiaTech 2019 is the latest addition to PV Tech’s acclaimed series of bespoke, high-quality, global solar PV events. PV IndiaTech will bring together all the key domestic and overseas stakeholders, including government bodies, investors, and the leading companies today from manufacturing to O&M and asset management. To thrive globally as a major PV power beyond 2020, India has to succeed in unlocking its potential both to manufacture and to lay claim to quality utility-scale solar farms that are providing high returns on investment to site owners.

On the other hand, the Manali-Leh highway, connecting the Indian foothills in Himachal Pradesh to this extremely remote enclave of mountain desert, is one the few access points to Ladakh and one of the most dangerous roads on the planet with the Rotang pass particularly picking up an ominous reputation. However, this is not the only access route as Zoji-La also connects Ladakh to Kashmir. Every spring, traveller forums buzz with tip-offs about when the various passes will open and rumours spread about the earliest ever openings in recent years. What we can say at least is that access is unpredictable.

“It’s quite clear that MNRE is being forced to come out with new ideas to spur activity in the sector, given all the problems that we are facing on land acquisition, transmission connectivity, reducing the cost of power etc.,” says Vinay Rustagi, managing director of consultancy firm Bridge to India. “My first thought is it’s a pretty radical idea, but on paper, Ladakh is excellent for solar power, because it’s got excellent irradiation and low temperatures so in theory, it is the perfect place for setting up a solar power project. The added benefit is that it has got plenty of land; land availability is not a challenge in Ladakh.”

The easy acquisition of land will be high on MNRE’s mind, says Rustagi. Indeed, Rahul Munjal, chairman of prominent Delhi-based developer Hero Future Energies said earlier this year: “I’ve always maintained the toughest thing about doing renewables in India is land”.

The projects would also be an opportunity to generate jobs in Leh and the Ladakh region, while also adding to development efforts in Jammu & Kashmir, which is a politically important region in India, adds Rustagi.

“So there are these multiple objectives that they are trying to combine and achieve by using the single task of developing projects over there.”

Nonetheless, there are still uncertainties around how many bidders can win the capacity and how transmission duties would be shared among multiple bidders.

Rustagi says it is likely that SECI wants the power transmitted to the substation in Haryana to be supplied to Delhi NCR whereby it could be bought and dispersed by distribution companies (Discoms) anywhere in North India across Haryana, Punjab, Delhi and so on.

The tender structure in terms of how the transmission is accommodated will be a challenge, adds Rustagi, again noting the extremely long distances and time that would be required to set up the necessary transmission links.

Engineer’s view

Advisory and engineering firm Gensol Group had already put together a feasibility analysis of setting up solar in the Ladakh. They found a capacity utilisation factor of 25.44% at a test site in Ladakh showed a “clear edge” of 1-2% in performance gain over and above other test sites in Neemuch in Madhya Pradesh and Rajasthan, which are both known to have some of the best irradiation in India.

However, Gensol listed a range of problems to overcome, with not just practical project considerations but also safety very high on the agenda in such an extreme location:

  • Undulated land pattern poses aligning and construction challenge
  • Disturbed soil pattern poses a design challenge
  • Higher wind speeds as areas identified are generally vast and deserted
  • Low population density, hence, the area is deprived of basic necessities
  • Water supply is a crucial aspect from both survival and maintenance perspectives
  • Power during construction will prove out to be expensive and scarce
  • Skilled manpower not available locally and bringing skilled manpower is cost intensive

In antithesis to the solar park idea, Gensol said that smaller portable solar installations combined with diesel would be preferred in this region. The population already relies heavily on diesel power. Gensol also said government support for ensuring safety would be imperative. Importantly, given MNRE’s idea to link transmission with solar development in the new plan, Gensol had also previously said that it would be important to treat transmission and distribution as an individual project as it would have its own set of challenges.

Using trackers was also recommended as it could increase yield by 4%.

Ultimately, for non-solar parks, projects would only be feasible if the transmission cost is subsidised, said Gensol. Meanwhile, the solar park model turned out to be beyond feasibility even if the transmission costs were subsidised.

It’s clear that SECI will have to come out with very attractive tender parameters that clear up some of these problems. It appears both a drastic but exciting proposition, that has a whole new set of complications compared to standard solar parks across India. If the projects go ahead, one can only hope that those working on the projects far up on high will maintain as much humour as the India Border Roads Organisation:

PV IndiaTech 2019 is the latest addition to PV Tech’s acclaimed series of bespoke, high-quality, global solar PV events. PV IndiaTech will bring together all the key domestic and overseas stakeholders, including government bodies, investors, and the leading companies today from manufacturing to O&M and asset management. To thrive globally as a major PV power beyond 2020, India has to succeed in unlocking its potential both to manufacture and to lay claim to quality utility-scale solar farms that are providing high returns on investment to site owners.

Zero energy buildings: Decarbonising India by tapping the sun

Indian buildings are silent energy guzzlers. They account for 35% of India’s overall power consumption and generate a significant amount of greenhouse gases. Because of ever-increasing population and urbanisation, the construction (and energy consumption) of buildings has seen a rampant rise. The next decade is expected to witness massive volumes of building construction, which will further escalate energy consumption.

While there is a strong policy-push towards the adoption of renewable energy technologies such as rooftop solar photovoltaics (RTPV), the potential for making zero energy buildings has not been explored extensively – even though experiments across the world (and India) have shown the possibility.

Net Zero Energy Buildings (NZEBs) – 100% energy-efficient, sustainable buildings – can be a game changer, not only for India’s building sector, but also for the energy sector. NZEBs have lower energy demand than that of conventional buildings and produce at least as much energy as they consume in a year, through onsite renewable energy technologies. NZEBs are commonly grid-connected to save battery costs. This allows them to draw electricity at night and during cloudy days, and return an equivalent amount of electricity to the local grid on sunny days. Thus, it nullifies the net carbon emissions from buildings.

In the Indian context, proactive government initiatives encourage decentralised solar photovoltaic (PV) technologies, such as RTPV and (to an extent) integrated solar photovoltaics (BIPVs). However, this has not evolved into an integrated policy that looks at achieving zero energy consumption from buildings.

Such green buildings can significantly support India’s Nationally Determined Contribution target to reduce the emissions intensity of GDP by 33–35% (from the 2005 levels) by 2030. Beyond this, NZEBs can emerge as a beacon for scaling up decentralised solar photovoltaic generation and support the efforts of the Ministry of New and Renewable Energy (MNRE) as well. NZEBs can help mitigate the consequences of climate change by bringing a revolution to both the construction and especially the energy sector.

Current status: slow progress is better than no progress

The Indira Paryavaran Bhavan in New Delhi (constructed in 2014) is India’s first NZEB, built with integrated energy-conservation methodologies and a super-efficient solar PV system of 930kW capacity. This system generates almost 1,491,000 units annually, while the overall energy demand of the building is approximately 1,421,000 units per year. However, in spite of their promising potential to tap solar power and address environmental challenges, only seven Indian states (including Delhi) have constructed NZEBs till now (see Figure 1).

Globally, however, there is significant policy push for NZEBs. For instance, the European Union has mandated that all new public buildings (post December 2018) should be NZEBs, and all upcoming buildings in the member states must be NZEBs by December 2020. California, as part of its Long-Term Energy Efficiency Strategic Plan, has mandated that all new domestic buildings be zero energy by 2020, and all new commercial buildings be zero energy by 2030.

Considering India’s housing and energy needs, especially its commitments to meet the Sustainable Development Goals, it is time for us to develop a comprehensive policy that looks at reducing the energy consumption of buildings.

Blueprint to design NZEBs by tapping solar energy

However, the question remains: How can we accelerate the growth of NZEBs and implement it on a large scale in Indian cities? Constructing NZEBs requires a two-pronged approach: incorporating energy-efficient techniques to diminish the energy demand and tapping renewable sources of energy, such as solar, to meet the residual demand (see Figure 2). For older buildings, we can consider retrofitting energy-efficient technologies and feasible decentralised solar measures to partially meet the energy demand. However, by incorporating these elements when designing buildings, the energy demand can be significantly reduced and the reduced demand can be completely met by solar technologies.

Typically, in both residential and commercial buildings, the maximum electricity consumption is from lighting and cooling appliances. Thus, to reduce the energy consumption of a building, factors such as building orientation, positioning of windows, and construction of horizontal and vertical shading elements should be taken into consideration to maximise daylight harvesting. By adopting natural ventilation, cross ventilation, double-pane or triple-pane windows, and fixing insulation materials on walls and roofs, solar heat intake can also be reduced.  

Furthermore, LED (Light-Emitting Diode) lights with automatic lighting controls, five-star rated electrical appliances, energy-efficient ceiling fans and air-conditioning systems should be encouraged for energy conservation. By including all these features, the energy demand can be reduced by up to 60%, and the residual demand can be fulfilled by onsite solar PV systems.

Fixing solar PV panels on rooftops has become a common practice to harness solar power, typically after the construction of a building. However, beyond rooftops, solar modules can also be mounted on building envelopes.  BIPV is an emerging alternative technology that incorporates lightweight, robust and weather-resistant PV modules on building facades, curtain walls, skylights, and windows during the initial designing and construction phases. BIPV is gaining traction in the country and has the potential to become an integral part of NZEBs.

From a design perspective, the optimal inclination angle for a solar module is close to location’s latitude (with ±5ᵒ deviation) and the orientation is due south in most cases for RTPV systems. A typical 1kW RTPV system can generate 1,500–1,600 units on an average every year. But, for BIPV implementation, solar modules can be mounted vertically, as well as with a tilt, on the facades and curtain walls depending on the facade’s material and design. Initial results of the study and calculations conducted by the Center for Study of Science, Technology and Policy (CSTEP) reveal that a south-facing BIPV system, vertically aligned, generates 50% less power than its rated capacity in any other position. A tilted system, on the other hand, performs as per expectations. However, it should be kept in mind that there will be an additional cost of constructing elevated structures in a tilted BIPV system. The levelised cost of electricity is quite similar for both systems and close to the retail tariff rates for the domestic consumer category, which makes them feasible on a south-facing facade.

At the moment, the initial investment for BIPV is high (although its long-term benefits outweigh the initial costs). However, the overall cost of BIPV can reduce, compared to that of conventional building material and construction costs, with adequate tax breaks and incentives.

At present, BIPV systems are not 100% feasible for the existing Indian building infrastructure due to certain challenges like heavy congestion, poor infrastructure and inadequate urban town planning. These might hinder developing a specific regulatory framework and policy, and the lack of government support for BIPV systems in India. Consequently, it is highly recommended that upcoming zero energy buildings and communities should be planned to harness the maximum solar potential using building envelopes. Using solar technologies is prudent because of their efficient performance, lower cost, durability, aesthetic appeal and longer lifespan.

Is ignorance of NZEB acting as a bottleneck?

The NZEB concept has not been implemented on a large scale in India due to the absence of a specific NZEB policy, well-defined government programmes, awareness, pilot projects and lack of success/failure stories. Additionally, the country lacks qualified design experts and architects with adequate knowledge to deploy NZEBs. Thus, training and development programmes for building simulation methods need to be encouraged as part of the educational curriculum. There is also a need for advanced and customised computational tools to design and simulate an entire NZEB, as per the choice of users. Such simulation tools can be helpful for evaluating and comparing a building’s performance before and after incorporating NZEB elements.

The cost factor is one of the biggest bottlenecks in the adoption of NZEBs; the overall cost of NZEBs is nearly 30% higher than that of conventional buildings. Nonetheless, NZEBs are worth it because of their premium value, and onsite RTPV and BIPV systems offer decent paybacks over time. Designing of attractive feed-in-tariff rates, for selling the surplus electricity generated to the local grid, can be another benefit from the cost perspective. Moreover, financial assistance or capital subsidy from the government can also reduce the overall NZEB project cost.

How to transform the energy and building landscape?

In view of the aforementioned barriers and the tremendous potential of NZEBs, there is an urgent need for a common platform, representing different stakeholders having adequate knowledge and expertise. The platform could include the Bureau of Energy Efficiency, Ministry of Power, MNRE, Ministry of Urban Development, town planning departments, building planners/consultants, construction material manufacturers, research and academic organisations, and municipal corporations. We suggest that an academic-industrial-government consortium be created to develop and promote a well-defined NZEB roadmap for large-scale development.

The goal of this consortium should be to set a small target for adopting NZEBs in India, by 2030, for trial. This will allow the consortium and other experts to evaluate the actual performance of NZEBs, and resolve problems that may arise. Thus, the consortium will be able to develop a specific design strategy to integrate energy-efficient and renewable technologies, especially BIPV and RTPV. Eventually, the consortium should also be responsible for obtaining financial support from different national and international funding agencies.

Similar consortia should be recognised at the central level as well as the state level. The central consortium will have to shelter all state-level consortia, and provide guidance and support.  These collaborations will contribute significantly towards achieving the existing and future solar targets, set by MNRE. In this regard, NZEB pilot projects, for residential and commercial segments, should be demonstrated and monitored by all state-level consortia. After experimentation in the states, pilot NZEBs should be launched in all cities across the nation.

Meanwhile, long-term electricity savings, cost savings, and environmental benefits of NZEBs should be acknowledged and shared with the public for bringing about increased awareness through channels such as traditional and social media. A large number of engineers and technicians should be trained to design and develop cost-effective NZEBs. The State Electricity Regulatory Commission (SERC) of each state can formulate attractive feed-in-tariff rates/incentives for selling the surplus power to the local utility grid. In the meantime, the above-mentioned departments associated with the building sector should also plan and develop net zero energy cities by making NZEBs feasible and scalable, with similar designs for each and every building. It can be argued that conducting such pilot projects in the Indian context will help decarbonise the building sector and ensure a complete makeover of the sector in the long run. Such efforts have the potential to not only meet the solar targets but also cross the targets in a sustainable and safe manner. They will also pave the way for creating a regulatory framework for NZEBs. We can thus achieve the dream of completely offsetting the adverse climatic impact of buildings just by deploying sustainable techniques and by harnessing the Sun, someday.

Solar industry manufacturing capacity expansion plans in Q2 take hit from China

PV manufacturing capacity expansion announcements in the second quarter of 2018, were slightly higher than the previous quarter, although activity slumped specifically in June, after China’s decision to suddenly cap utility-scale and distributed generation (DG) projects (531 New Deal). But large-scale multi-gigawatt production plans in the first half of the year may have hidden an inevitable slowdown, despite the impact on downstream demand from the 531 New Deal.

Recently published in edition 41 of Photovoltaics International is the white paper “PV manufacturing capacity expansion announcements in Q2 2018”, which can be accessed online through a paid annual subscription to the journal here, or individual white paper purchases here.

Below are some of key findings from the Q2 2018 report.

PV manufacturing capacity expansion announcements in the second quarter of 2018, were slightly higher than the previous quarter, although activity slumped specifically in June, post China’s decision to suddenly cap utility-scale and distributed generation (DG) projects (531 New Deal) but large-scale multi-gigawatt production plans in the first half of the year may have hidden an inevitable slowdown, despite the impact on downstream demand from China post the 531 New Deal.

Second quarter review

Total combined second quarter 2018 capacity expansion announcements were 25,580MW, up from 24,870MW in the first quarter of 2018, despite the rapid decline in announcements in June. 

Plans by GCL in India and Egypt significantly boosted totals in the quarter and both announcements remain highly speculative at time of writing. Excluding the 9GW of MOU’s from GCL, total announcements would have been around 16,500MW, considerably down quarter-on-quarter. 

The biggest impact from excluding GCL would have related to solar cell expansions, which would have totalled just over 1GW, instead of over 10GW as reported. 

Module assembly announcements in the quarter totalled 14,200MW and 5,200MW if GCL was excluded from the analysis. Thin-film was 1,200MW in the quarter, all contributed by First Solar. 

Geographical split

Plans by GCL in India and Egypt also skewed capacity announcements on a geographical basis in the second quarter. The 10GW possible plans (5GW cell and 5GW module assembly) in Egypt meant it was the top location in the quarter.

However, GCL’s potential plans in India were supported by planned expansions by two India-based companies, resulting in a total of 9.5GW announced in the quarter. 

Turkey continues to attract potential capacity expansions, having accounted for 3,950MW of announcements in 2017, the second quarter of 2018 accounted for 2,580MW, highlighting both the local content rules and growth in PV deployments in the country that continues to attract potential capital investments in manufacturing from both Turkish and overseas. 

Also of note in the quarter was the impact of new import duties imposed on most of the rest of the world in the US. Led by First Solar and LG Electronics and adjustments by CSUN, the US attracted a total of 1,900MW of new capacity expansion announcements in the second quarter, up from 1,600MW in the previous quarter.

First half year review

In the first half of 2018 a total of just over 50.4GW of combined (cell, module, thin film) capacity expansions were announced, down from over 52.7GW in the prior year period, indicating very little change. 

Thin-film planned expansions remained strong with announcements totalling over 3.3GW in the first half of 2018, compared to a total of over 3.9GW in all of 2017. 

Solar cell announcements in the first half of 2018, topped 17.3GW, compared to over 30GW in the prior year period. This figure drops to around 8.3GW if GCL plans in India and Egypt are excluded. 

A total close to 30GW of new module assembly capacity expansion announcements were made in the first half of 2018. This compares to nearly 14.6GW in the prior year period. 

However, the key difference was the significant level of new investments in high-efficiency PERC and next-generation cell technologies, compared to conventional module assembly expansions. Much of the existing module assembly capacity could be upgraded to meet the cell technology migration (half-cut, PERC, Multi-Busbar etc…). 

Again, decoupling GCL from the second quarter actually lowers module assembly plans to just over 21GW.

When analysing expansion plans on a geographical basis in the first half of 2018, it would seem that its business as usual when total combined announcements for China topped 15.74GW. However, only 1.5GW was announced in the second quarter, all from JA Solar. 

After record announcements in the fourth quarter of 2017, both first and second quarters of 2018 were stronger than expected, although there was a marked shift back to module assembly compared to cells in the fourth quarter of 2017.

The impact from China’s 531 New Deal did have an instant negative impact on new capacity expansion announcements in the month of June. 
The high-level of activity in 2017, coupled to similar levels in the first half of 2018, which are dominated by multi-gigawatt multi-phase, multi-year expansions (wafer, cell and module), could limit the level of overcapacity intensity, resulting in a large number of planned phased expansions being put on hold both in China and India, in particular. 

The second half of 2018 is expected to reveal the scale of the disruption to capacity expansion plans caused by China’s 531 New Deal. 

However, low utilisation rates, notably of multicrystalline-based technologies (wafer and cell) could lead to manufacturing plant closures in many regions, not just in China and South East Asia, while higher utilisation rates for monocrystalline technologies could result in existing expansion plans continuing with limited delays, due to the general industry shift to mono and higher efficiency products. 

Multi-GW India manufacturing challenges to be the focus of new PV IndiaTech 2019 conference

During the past few years, we have had numerous requests at PV-Tech from a wide range of PV industry stakeholders (due mainly to the success of the PV CellTech and PV ModuleTech series of conferences) to launch an India-specific PV event in Delhi. The requests have come from Indian companies, overseas investors, government bodies, trade associations, and both upstream/downstream industry activists seeking to understand and drive future developments.

As a result of these requests, and given the key stage Indian PV manufacturing is going through today, we have decided to launch an annual event in Delhi, dedicated specifically to India PV manufacturing. PV IndiaTech 2019 will have its premiere on 24-25 April 2019.

This article discusses the need for such an event, and what the key objectives will be from the conference. More broadly, I outline here also just why any company with global PV aspirations (across the entire PV value-chain) either has, or needs to have, a carefully considered India-PV-strategy plan.

Once you have absorbed all the information, it would be great to get your thoughts on PV IndiaTech 2019, and how we should configure the event with the correct mix of global stakeholders needed to move the industry’s manufacturing forward over the next 10-20 years.

Unique focus on manufacturing that bypasses short-term opportunism

Every country that embarks on a solar or renewables plan does so with lofty ambitions of creating an indigenous manufacturing landscape that results in high-quality sustainable job creation. Conversely, no government wishes to bankroll a deployment gold-rush that ends up being cornered by Chinese imports. Chapters of thesis could be filled simply by solar activities in this regard over the past few years.

For the countries that have sought to impose domestic manufacturing restrictions, whether to bail out domestic companies such as in South Korea and Taiwan or show evidence of token manufacturing efforts by way of module assembly plants, there has been all too often an air of short-termism.

Linking a viable domestic manufacturing sector with a risk-free long-term pipeline needs a government commitment that extends beyond 10 years, and in this respect, we can start to see just why PV manufacturing ambitions within India today are different from anywhere else globally.

But there is much more. India has an embedded goal of being seen on the global stage as a high-quality technology leader, and not simply another Asian country (post Japan, Korea, Taiwan) that has labour costs or a sophisticated OEM-culture as its primary drivers (Thailand, Indonesia, Malaysia, Vietnam). This largely captures the Make-in-India mantra, but for solar there is also the deployment (energy demand) driver that moves things to another level.

Fundamentally, India is the only country today that has a multi-decade forward-looking plan – championed by the current Prime Minister – that covers both deployment and upstream full value-chain manufacturing. No other country comes remotely close to this, with the exception of China (that is barely open for business when it comes to inward investment).

What India wants is a massive challenge

India wants to have a solar manufacturing sector that has the technology-brand of Japan or South Korea, the processing capability of Taiwan, the cost structure of China and the inward-investment lure of Malaysia. And to top it off, the final product performance and quality will allow leading producers to access both domestic needs and export opportunities.

As aspirational as it may sound, if you don’t have those ambitions from the start, you are almost certain to fail. The issue with India though is that we are a long way away from this, when we look at the country’s manufacturing sector today and the ongoing tumultuous relationship it has with its downstream suppliers.

During the past couple of decades, there have been many plans tabled to unleash a multi-GW eco-system value-chain of PV manufacturing. Almost all of these were lauded by eager publicity-seeking activists, but many began and finished at the ceremonial MOU phase, never to be heard of again. Those were the days of polysilicon plants being built or thin-film factories piggybacking on the country’s displays-oriented ambitions.

What finally did emerge in the early days of India solar (that remains until today) can be seen, for example, at Greater Noida (Indosolar) and Hyderabad (then-named Solar Semiconductor), in what were the first purpose-built ‘modern’ cell fabs in the country. In fact, during an early trip to India almost 10 years ago, I remember vividly the pride that India has entered the fab-era.

The start-stop production characteristics of these early entrants, in addition to the never-ending existence of various state-owned loss-making solar business units, seems a long way off, given what has happened in the past few years that starts to paint a picture of what this India-solar paradise may look like if the different stakeholders can make it work.

Government driven upstream and downstream finance

The launch of the National Solar Mission within India changed everything. It put to an end to the notion that pure-play cell production could compete as an export industry. It created a multi-GW end-market that caught the attention of the world. It was inherited by a Prime Minister (Modi) that has no equal anywhere else in the world when it comes to an inherent love of solar and an understanding of how it can transform India as a global leader in a post-fossil-fuel world.

The long-term commitments by Modi for deployment of solar within India serve as the most risk-averse guilt-edged market driver that could be imaginable. Yes, there is downside that accompanies this rapid growth in India, and I will touch on this later in the article. But, either way, any other domestic solar segment globally would readily have this problem in exchange for a constant pipeline of opportunities.

During the past few years, the concurrent upstream drive has come from a succession of attempts to restart domestic cell and module production, through safeguarding, domestic-content carve-outs and the latest Solar Energy Corporation of India’s (SECI) tendering for 3GW of manufacturing linked with deployment guarantees.

Running alongside these policy-driven initiatives, there is of course Adani, and the Mundra-chapter in India-PV, where the multi-sector, multi-national, multi-billion-turnover conglomerate sought to self-fund a micro-solar eco-system at the GW-level.

As of now, none of these efforts has succeeded, and in almost every case (and of course with hindsight) one can easily point the finger at naïve-ambition or a general lack of awareness of technical and commercial factors that underpin the global solar manufacturing sector today.

However, what these efforts reveal is intention, or perhaps a crash-course in PV manufacturing learning that should serve to get it right going forward.

Getting it right

If there was a simple domestic recipe to scale up multi-GW solar manufacturing, spanning ingot/wafer and cell/module production with profitability, there would be PV fabs all around the world, and trade-related barriers would never be heard of. Similarly, if there was a means of curbing global China-export domination, the world would look radically different today.

As such, there is no slight on any of the proponent’s motives, nor should one take apart the flawed assumptions that ultimately led to non-success.

Regardless of the 25GW of solar deployed today within India, and the failure of the previous domestic manufacturing efforts, one should still see India at the start of a journey, perhaps even just finishing its formation lap.

The long-term goal remains intact: being a global PV manufacturing powerhouse, driving domestic demand and having an export-market for any surplus. And critically, there remains the promise of finance through direct government budgeting and inward-investment vehicles including overseas government agreements and energy/infrastructure investment vehicles.

In this respect, there is almost an inevitability that multi-GW PV factories will emerge within India over the next 5 years, but the fundamental question remains: can they get it right?

 

Finding a route where everyone benefits has to be the solution

Understanding what has to happen in the short-term is inextricably linked to what a successful outcome looks like; and working back to what steps need to happen to fulfil this.

The successful outcome sees many parties benefiting in different ways, but most seeing this through short-term profitability, healthy returns-on-investments or market-favourable asset-values. Other stakeholders – in particular the Indian government and overseas countries that have intrinsic connections – benefit directly and indirectly in terms of global leadership and secondary diplomatic positioning in a renewables-dominated climate.

However, it would appear today that the ingredients for success boil down to a few key issues that need to be resolved:

What stages in the value-chain (for c-Si manufacturing) are of value for Make-in-India? Is it necessary to install ingot pulling capacity or should the focus be firmly on cell production, with matched module assembly capacity?

Which technologies need to be selected today for manufacturing investments that – by the time the facilities are operational – are state-of-the-art in terms of cell efficiencies and panel performance?
How do GW-scale factories get completed in Chinese-based timelines of 3-6 months, and retain the flexibility in adopting any technology-adoption cycles that may impact the industry going forward?
What is needed to manufacture with profitability? Is the model based purely on buying wafers from China and hammering down in-house costs on a quarterly basis, or is there a supplier/customer model that sees both parties sharing profit margins?
What is the role of overseas companies, and how can they add value to the Indian sector, and not simply be a strategically-funded platform to expand global reach?
How can the downstream segment within India (developers/EPC/investors) benefit financially from the increased availability of Indian-made PV modules (using domestic produced cells and possibly even wafers)?
What policy-driven, government-backed vehicle can make the above questions work in parallel?

These questions are possibly the most pertinent when considering how India moves forward with PV manufacturing, and to get to the bottom of these it is clear that a broad range of stakeholders need to be part of the overall decision-making process: something that has probably not occurred until now.

PV IndiaTech to provide global platform to facilitate India-PV planning

In order to address the questions listed above, it is clear that a forum needs to be created that hears the voices of the different parties that will be needed to fashion a plan that works to everyone’s benefit.

This is the fundamental goal of the PV IndiaTech conference, the first event due to be held in Delhi on 24-25 April 2019.

While there are numerous PV events within India these days – as would be expected from a 10GW-level annual end-market – the role of PV-Tech, as a leading global PV platform and the host of the PV CellTech and PV ModuleTech events, should not be underestimated. India needs global expertise and a connection of its upstream/downstream segments, while having the understanding of which roadmaps are worth aligning with to be industry-competitive going forward; and also welcoming the expertise that exists from the correct overseas technical and financial investors.

We are currently in the process of finishing off the agenda for the forthcoming PV IndiaTech 2019 conference, including key partners, speakers and event contributors. If you would like to feed into this process, or be part of the event in Delhi on 24-25 April 2019, then please reach out to us by email at marketing@solarmedia.co.uk, or drop me a line directly (by clicking on my name at the top of this article) with your ideas and suggestions.

During the build up to PV IndiaTech 2019, PV-Tech will be taking a closer look at many of the issues raised within this article, as well as highlighting the event in Delhi including interviews with all the parties seeking to find a solution to unlocking the potential of Indian PV manufacturing over the next 10-20 years.

India’s Gujarat solar bid of 2.44: A castle in the sky?

The darkness for Indian solar developers might not have subsided, even as their stubborn resilience makes them misguidedly bullish about India’s impending solar bubble. This copious optimism while bidding for solar power projects is shouting for attention, when we see that the solar bids in Gujarat’s 500MW auction have once again pinned faith in the magical figure of INR 2.44/kWh (US$0.034).

While this number seemed sacrosanct and fraught with logic when we delved into its reasoning two months ago, an unnerving collection of events has put us on tenterhooks.

In our article dated 18 July 2018, we had argued that module prices in China would touch US$0.24/watt by the end of this year and that by considering an US$/INR exchange rate of INR 69 per US$ (at that time), the price of modules would translate into INR 16.56 per watt peak. Then again, the balance of system (BoS) pricing for big ticket projects could be easily achieved at INR 12 per watt peak, which would take the project cost to INR 28.6 per watt peak, we had maintained.

Things aren’t same anymore. It is one thing to issue a prognosis and it is another to see the reality. The current flux through which the Indian economy is going provides a sobering illustration of how hard it is to tame the future. Nevertheless, it merits a serious analysis.

Three factors can help explain why 2.44 could be a pipedream to achieve —safeguard duty, GST and the complications of Indian currency. First safeguard duty. Piquantly, the tender has allowed a commissioning timeline of 21 months for projects up to 250MW and 24 months for projects above 250MW, which means that by the time panels land in the Indian territory, the safeguard duty will have gone down to 15% from the current 25%. Assuming current prices of US$0.27/watt for Tier 1 modules and that they would decrease by 10% every year, as production processes spruce up with time and as history corroborates, we see prices hovering around US$0.2187/watt, when the time of ordering arrives.

The second factor behind the turmoil is the GST. The sector got gripped in incertitude when some Authority for Advance Rulings (AAR), state government bodies issuing rulings pertaining to taxation, held that solar power plants would face 18% GST and not 5%. To put things into context, the problem stems from the fact that concessional GST rate of 5% applies to solar power generating systems but solar power generating systems (SPGS) have not been defined in the law. Absence of a definition has led to ambiguity and different interpretations with regard to meaning and taxability of SPGS. Consequently, the Construction of Solar Plant is being seen as a ‘Works Contract’, which attracts 18% GST, against a ‘Composite Supply’, for which a concessional rate of 5% has been prescribed by the law.

The last factor that is wreaking havoc on the arithmetic of solar tariffs is the widespread dismay about the ferocity of the depreciation of the Indian rupee. At the time of writing this article, the currency fell to INR 73.01 against the US dollar, its weakest level till date, as macroeconomic concerns persist, including higher crude oil prices, trade deficit, weak investor sentiment, and capital outflows.

Importantly, the rupee’s slide was triggered by factors like oil prices hitting their highest levels since 2014. We see that the global crude prices are up due to a decline in production, even as demand has increased. Considering that India meets nearly 80% of its fuel needs through imports, it will be splurging dollars, a situation that doesn’t augur well for the rupee. The outflow of dollars, in turn, puts pressure on the current account deficit (CAD), i.e., when the value of goods and services imported is more than the exports bill. Together, a surge in oil prices and a higher CAD are giving a serious drubbing to our domestic currency.

What is more, the weakness in Indian rupee is expected to continue further and the domestic currency could keep above 70 per US dollar if crude oil prices continue to be upward, according to Credit Suisse. It is worrying to note that the global financial services major maintains a negative stance on the Indian rupee and forecasts that USD/INR will stand at 70 for 12 months.

Plugging it all together, we see that with modules at US$0.2187/watt (and sliding @10% per year), safeguard duty at 15%, dollar at, say, 70, BoS at a lower number of INR 10/watt peak, GST at 18%, the project cost touches INR 32.47/watt peak. This throws a tariff of INR 2.47, when plugged in our LCOE sheet, with all other parameters remaining constant. Sadly, this leaves no room for running any sensitivity analysis, but if we still consider GST @5% and apply a deviation of 5% on cost, the LCOE stands, uncomfortably, at 2.33, which is definitely a tight-rope walk.

As a sagacious thought, the strategy in the long run should be to manage the currency risks, fine-tune supply chain and religiously oversee the project execution on ground, as there is hardly any margin of error, if the developers are determined to test their numbers.

But, as things stands, this looks like a castle in the sky or, at least, something very very (2 times) hard to achieve!

India’s top three solar module suppliers on the future of Mono

While India’s solar market is still heavily weighted on the lowest possible costs, the price difference between monocrystalline and polycrystalline PV module technologies is beginning to fade. PV Tech caught up with major module suppliers at the REI Expo in Greater Noida, India, to discuss the future of Mono in this heavyweight global market.

Speaking to PV Tech, Anmol Singh Jaggi, co-founder of India-based solar advisory, EPC and O&M firm Gensol Group, which has provided services on multiple gigawatts of projects across India, estimated that technology choices for Indian projects in 2017 came out at 95% Poly and 5% Mono. But in 2018 it has been closer to 85% Poly and 15% Mono. Furthermore, he predicts 2019 to draw 65-70% Poly and as much as 30-35% Mono.

Singh Jaggi said: “The reasons are very clear. Today the non-safeguard price is 25 cents on the module. Earlier the Mono guys were charging 3-4 cents as premium. Now the premium has come down to 1 cent – even as good as no difference on the Mono versus Poly price, but Mono helps me a lot on my balance of system. The same module, whether it’s 325Wp or 345Wp, reduces my Balance of System (BOS) by 8%, which is extremely interesting to save costs. So Mono is the future because we don’t see any difference in the Mono versus Poly pricing now.”

He went on to explain how higher wattage helps EPCs reduce cable, rail, and structure costs to name just a few pieces of equipment, as well the reduction on cost of installation and time. The market is changing very fast and Mono is starting to make an impact on India, particularly in the rooftop space, he added.

Describing an Indian market that is in difficulties with safeguard duties, rising interest rates, a depreciating rupee against the dollar and a Goods and Service Tax (GST) of 18% rather than 5%, Singh Jaggi added: “When we are in the market of only bread and butter (no cheese or jam), every price counts.”

What the top three suppliers forecast

According to consultancy firm Bridge to India’s ‘India RE Map’ the top three PV  module suppliers to India in FY 2017/18 were China-based manufacturers Canadian Solar, JA Solar and Trina Solar.

JA Solar

Victor Liang, sales manager, JA Solar, said that polysilicon modules still dominate the Indian market with the firm’s sales last year and the first half of 2018, coming out at 99.9% in Poly technology. This is because customers still feel that the cost to efficiency ratio remains best with Poly, said Liang. However, he said new specifications are becoming more popular and while JA Solar has been actively promoting Mono-PERC modules globally, which it sees as the future of the mass market, it is also now promoting this technology in India.

“[Indian customers] were thinking Mono-PERC is too expensive to make the financial model work, but now the price gap is very very small,” he added.

Liang also noted that Mono-PERC has been proven already in markets like China, America and Asia Pacific. As a result, he believes that Mono-PERC will start to take some shares of the Indian market from Poly starting from this year onwards.

Canadian Solar

Yan Zhuang, president and COO, Module and System Solutions, Canadian Solar, the top supplier to India last year, said that the Indian market has traditionally been very price driven and less technology-sensitive.

“In past years manufacturers have been shipping the low-end products and offering the lowest price, and today the price pressure is even harder. The PPA price is coming down and together with the safeguard duty which adds pressure on capex and cash flow,” he said.

However, Zhuang is beginning to see PV players focus on higher performance technology with increasing costs, with some players as early as 2016 looking at LCOE when procuring modules. Indeed, he forecasted that if not this year, then by 2020 at the latest, project developers will have to look towards new technology to save costs rather than focusing on low-end products for the lowest price. He cited bifacial module technology as a key mover in this regard.

Zhuang also claimed that once grid parity is reached at a mass scale, this will iron out some of the major annual market fluctuations caused by subsidy support curtailment, and then cost structures will be stabilised, the market will become more predictable and customers will be able to plan in more detail and therefore focus on better technology.

Nonetheless, Zhuang also claimed that there is much chat about the Mono versus Poly debate, with bold statements such as ‘Mono will replace Poly’, for example. However, as only a few players represent the majority of the Mono wafer capacity, that market is open to speculative pricing in a way that the open Poly market is not, he claimed. This can keep the Mono prices high at times when the Poly price dives and therefore project economics will keep the Poly products alive. Ultimately the prices of Mono and Poly wafers will be the key differentiators.

“The Mono market share will grow, but poly will still be there,” he said.

He also suggested that Mono players are on the offensive and may become more aggressive in their pricing, but this cannot be sustained for too long.

“In the end people have to make money, at a certain point they have to stop and Indian price is already very low – you can’t go any lower – so in today’s industry we all know that silicon is at the RMB80 per kg [US$11.68] and in wafer and cell and module no-one is making money. The entire supply chain is losing money and today the only driver for cost reduction is RMB currency depreciation.” 

The only other factor that could change costs for next year, said Zhuang, is technology innovation, but technology does not change prices dramatically in the space of one year.

Remarking on the 2.44 rupee tariff discovery in Gujarat’s 500MW solar auction earlier this week, Zhuang said: “I think it can be managed at that price and the project can be built.”

This was assuming a market price of 23 to 24 cents per Watt for Poly modules from tier 2 suppliers (excluding shipping), he said.

However, Zhuang again highlighted bifacial technology as an unavoidable technology of the future: “Moving forward at a certain point they have to think about using bifacial technology. The investors, the banks would have to accept that. It would dramatically increase the yield of the project by around 10%. Indian conditions are suitable for that – flat and barren land with hard ground.”

Trina Solar

Gaurav Mather, sales director, India, Trina Solar, said that Poly is dominating the market, however, all players will start having to look at Mono-PERC as the price starts to be comparable with Poly.

“We estimate that that second half of 2019, the gap between the Mono and the Mono-PERC and the Poly will be very minimal,” he said.

However, Mather expects Poly to continue as mainstream in India because of the focus on low tariffs and aggressive pricing. Mono-PERC will however appeal to certain developers looking at LCOE.

“So far we have supplied very small systems of Mono-PERC to India and Mono also for rooftop, but primarily all the bigger projects we have supplied they are all Poly,” he added.

In terms of N-Type module technology, Mather believes it will take a long-time to take hold in India because of the pricing, however, he – like others – sees bifacial as a major future prospect, particularly in the floating PV sector, which is beginning to flourish in India.

Changing opinions

In a testament to the rise of Mono technology in the country, Bridge to India’s Solar Compass for Q2 2018 tabbed Mono specialist Longi, followed by thin-film specialist First Solar and Chinese firm Yingli as the top three module suppliers for projects commissioned in the quarter.

Jason Chow, marketing manager at Mono specialist LONGi Solar said the company had a very successful 2018 in India, but it has historically been hard in this region to promote its PERC technology due to the higher costs in such a price-sensitive market. The company has been striving to change customers’ attitudes to concentrate on performance over cost.

Pranav Mehta, chairman, National Solar Energy Federation of India (NSEFI), said: “I’m happy that Mono is picking up globally and making some inroads in India. LONGi and Trina, now GCL will also have to follow through. Everybody has to now [look at] Mono PERC. That percentage of Poly is going down – 99% to 90% let us say, but there’s still miles to go.”

Borrowing the sun when it should be free

Let’s agree that the limited reserves of fossil fuel and its growing impact leading to environmental degradation highlights a very costly, dangerous, and unsatisfactory future for our world. It is easy to understand that as the fossil fuel reserves near depletion, the cost of fossil fuels will rise, depriving even more people of energy (currently more than 1 billion people live without electricity in the world). On the other hand, solar energy offers an opportunity to get out of the tightening binds of depleting fossil fuel reserve, while offering power to all. So, there are no doubts that we are in the middle of a transition period, but how can developing countries benefit from this transition?

Solar offers overall growth

We must highlight that, energy and economy are interconnected components. Thus, growth in solar within a country (which promises to solve energy scarcity) signifies new overall development and construction of a progressive economy. Let us see how:

  1. Focusing on solarisation can reduce fossil fuel import cost and offer better energy access to developing countries.
  2. A fraction of money saved on fossil fuel imports can be used to expand renewable energy production by building industry. This will allow countries to access export market and kick back profit within industry development.
  3. Industry growth will lead to job creation, skill development, and empower citizens to become earning and contributing members of the country’s economy.
  4. With industry development and manpower creation, production will increase leading to technological innovation.
  5. And ultimately, better products will create demand in and outside the country, bringing more profits, aiding in industrial, social, and economic growth.

As the above stated points reveal, it is a cycle; one empowering another, leading to the development of a country’s economy and diversifying its sources of energy and income.

Global acceptance is at hand

Understanding the potential of green energy transition through solar, developing countries like Brazil, Philippines, Egypt, Mexico, Turkey, Chile, Africa, and India are investing in solar. As a result, renewable energy investment (US$286 billion) surpassed investment in coal and gas (US$130 billion) in 2015-16 and reached to US$333 billion in 2017-18. Solar investment globally amounted to US$160.8 billion in 2017, up 18% on the previous year despite these cost reductions. Additionally, solar PV project auctions in emerging markets rose by 4.5 times within 2013-17. So, it is apparent that global demand and acceptance for renewable energy (especially solar) is on the rise.

We shouldn’t buy the sun from others!

We have already explained how a green energy transition through solar can not only offer power to all but support and lead socio-economic growth of a country. However, that totally depends on building industry and manufacturing capacities. Unfortunately, countries, especially developing countries are losing their chance of building a better future through enhancing manufacturing capacities, as countries with vast manufacturing scale are flooding their market with solar components priced at much lower than market cost. Low priced solar modules and components may appear as a great deal for developing countries, but it is actually robbing them of the opportunity to build manufacturing capacity and speed up the overall growth of their country.

Countries like China becoming a world supplier of solar components will centralize the solar industry in foreign countries, further strengthening their capability to control the industry and put the dream of becoming a solar power on unstable grounds. Centralising the solar industry to a handful of countries will also introduce a decline in technological improvement, since those countries will most certainly invest most of their time and money on expanding their supply chain (to meet growing global demand) rather in R&D. There shouldn’t be limitations on global manufacturing or monopoly on the sun.

Protecting domestic manufacturing sector Is a necessity

The US has taken measures to protect its domestic manufacturing industry. The US Department of Commerce imposed up to 165.04% on PV solar imports from China and Taiwan in 2014 and in 2018 the country imposed 30% tariff on solar imports.

Although, developing countries like India have shown intent towards rapid solarisation, in most cases this growth has been depended on solar imports (especially in case of India). India spent $3.1 billion in solar equipment imports, which is about 35 times its solar equipment export. In FY 17-18 the expenditure stood at $3.8 billion. This massive import figure helps only achieving short-term goals of the country without having a sharp precognition on the global future energy control map. Growing expenditure in import blocks the country from investing in domestic manufacturing, and gives control of Indian solar future to foreign suppliers (Chinese suppliers already hold ~80% share in solar market in India).

Here, it is important to underline that spending billions on imports doesn’t really create jobs but only increases forex outflow, which could have been spent towards industrial growth.

Following the leaders

Dominant solar countries like China have aggressively expanded their domestic manufacturing capacity, which has helped them to control the price of the modules, while creating jobs, and claiming the export market. Developing countries like India should follow these tried and tested business tactics and focus on domestic solar manufacturing to establish its position in the global export market. In case of India, we should say “re-establish” as the country used to have a strong export base, catering to the rising demand in Asian and European markets during 2000-2010.

Initiatives like International Solar Alliance (ISA) offer financial support, technology exchange options, and a collaborative platform, which developing countries like India can use to build manufacturing scale within and sore high. However, Governments should look towards solving the internal issues as well. For example, Indian domestic solar manufacturing is going through issues like added 18% GST towards solar project development, 25% safeguard duty imposition on SEZ based solar manufacturers, increase of tender cancellation etc.

Domestic solar manufacturing has to be prioritized and these issues have to be solved to support the growing solar industry within India. Solar should be considered as the best possible opportunity a country has, to grow out of the fossil fuel binds and become energy self-reliant, creating jobs, trade relations, and economic stability. And since building manufacturing scale is the only way to achieve that goal, we all should work towards supporting this target and position India on the supply of the global future energy map.

This week, PV Tech gathered views from various players – both foreign and domestic – about what steps need to be taken to support local manufacturing in India, while at the REI Expo 2018 exhibition in Greater Noida, India.

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