The average cost of large-scale solar projects in India fell 2% quarter-over-quarter (QoQ) and 25.7% year-over-year (YoY) in the second quarter (Q2) of 2024. Since Q1 2023, large-scale solar project costs have dropped for six straight quarters, with an average fall of 6% per quarter.

In Q2 2024, the fall in project costs was primarily driven by the fall in module prices. Module costs accounted for 46.8% of the solar project cost in the quarter and witnessed a 3.6% per MW drop QoQ.

The findings were published in Mercom India Research’s recently released Q2 2024 India Solar Market Quarterly Update.

Indian manufacturers have been listing their modules both before and after the reimposition of the Approved List of Models and Manufacturers (ALMM). As a result of increased competition among ALMM-authorized manufacturers, prices have remained stable.

The Indian mono PERC modules’ average selling price (ASP) fell 2.6% QoQ and 40.7% YoY.

However, due to higher demand compared to supply and added production and bill of material (BoM) costs, DCR (domestic content requirement) module prices were 45.9% higher than non-DCR variants.

India imported solar cells and modules amounting to over $774.9 million (~₹64.6 billion) in Q2 2024, a drop of 61.4% QoQ and 16.4% YoY. Solar cells accounted for 45% of the quarter’s imports.

Since the reimposition of the ALMM order on April 1, 2024, developers have started procuring India-made modules, leading to a sharp decline in solar module imports. Q2 2024 saw the lowest imports of cells and modules by value since Q1 2023.

The ASPs of Chinese monocrystalline (mono) Passivated Emitter Rear Contact (PERC) modules fell 11.8% QoQ and 50% YoY due to oversupply in China.

The recent increase in metal prices for steel, aluminum, and copper also impacted project costs in Q2 2024.

In a quarter-over-quarter comparison, power conditioning unit costs fell 1.4%, and mounting structures costs dropped 1.9%. The cost of balance of system (BoS) components remained unchanged.

In Q2 2024, solar installations rose 170% year-over-year to 5 GW from 1.8 GW. Large-scale installations totaled 4.3 GW in the quarter.

As of June 2024, India’s cumulative installed solar capacity, including rooftop solar installations, stood at 87.2 GW.

Mercom’s Q2 2024 India Solar Market Quarterly Update is 85 pages long and covers all facets of the Indian solar market and a detailed analysis of the project cost trends. For the complete report, visit: https://www.mercomindia.com/product/q2-2024-india-solar-market-update.