Average Cost of Large-Scale and Rooftop Solar Projects Fell in Q2 2020

The average large-scale solar project cost was approximately ₹34 million (~$455,532)/MW in the second quarter (Q2) 2020, a decline of 10% from the same period last year, according to Mercom’s recently released Q2 2020 India Solar Market Update.

That said, the system cost saw only a decline of 2% when compared to Q1 2020.

Q2 2020 Average Large-scale Solar Project Cost per MW

Solar installations saw a decline of 81% with additions of just 205 MW of solar capacity in Q2 2020, compared to 1.09 GW installed in Q1 2020. Solar installations were down by 86% year-over-year when compared to 1.5 GW added in Q2 2019.

The average rooftop solar project cost in India per MW was ₹36.5 million (~$489,027), a drop of 9% as compared to the same period last year. The figure dropped marginally by 1% when compared to Q1 2020. The drop in rooftop figures, as well as large-scale solar projects, could be attributed to the falling prices of modules.

With the cost coming down, solar modules accounted for nearly 44% of the total cost of large-scale solar projects, which was nearly the same as in Q1 2020.

For rooftop, solar modules accounted for 43% of the total cost of the project. Solar inverters accounted for 7% of the total project cost.

The average large-scale solar system cost was approximately ₹35 million (~$0.46 million) in Q1 2020, 12% lower compared to ₹40 million (~$0.53 million) during Q1 of 2019. Costs were down by 3% compared to Q4 2019.

Previously, Mercom had reported that higher efficiency products are gaining market share, and costs are dropping quickly. The newer products are not only more efficient; their benefits include longevity and the ability to reduce BoS (balance of system) costs. In India, the price differential between polycrystalline and monocrystalline continues to decline. The shift is well underway, however slow.