Over the past five years, India has become a thriving market for solar component suppliers. Between 2014 and 2019, the installed capacity of solar energy projects has grown at a compounded annual growth rate (CAGR) of over 60%. The demand for solar modules has been strong and is expected to remain so over the next few years. The Indian solar market has mostly been dominated by international module suppliers, while Indian module suppliers are gaining market share after safeguard duty was imposed. Some international module suppliers have raised concerns with respect to these regulations. According to international module suppliers, the Indian government’s implementation of these quality control measures is slowing down new product launches due to various technicalities, and this is preventing Indian developers from accessing the latest in solar equipment technology.
It all started when the government issued regulations for the standardization and quality control measures for cell and module technology last year to maintain the quality products being deployed.
However, the quality control measures introduced by the government has suffered from rocky implementation. In October 2018, Mercom reported that the guidelines concerning testing of PV modules had not produced the desired results. Contrary to what was expected, manufacturers were not yet queuing up to get their modules certified. Moreover, only a handful of domestic and international players had received the certification from the Bureau of Indian Standards (BIS).
Around the same time, the Ministry of New and Renewable Energy (MNRE) also launched measures that mandated suppliers to enlist models and manufacturers of solar modules to be published on the ‘Approved List of Models and Manufacturers (ALMM)’.
Further, in December 2018, the MNRE asked lenders to insist on BIS certification of solar modules rather than a tier-1 list. While these steps have been taken to protect the industry at large, they have posed a hurdle for manufacturers trying to introduce new products in the Indian market.
The regulations have put pressure on international suppliers to comply with Indian standards. However, some module suppliers have been facing challenges which have manifested into increased costs and time to adhere to the guidelines.
Module suppliers have voiced their concerns about both the issues – getting BIS certification and enlisting on the ALMM. Suppliers told Mercom that there are several issues concerning the BIS standards not being updated to the latest edition and technical requirements that limit module suppliers from offering new technologies to the Indian market.
Commenting on the BIS certification norms, Ponesekar. P, vice president at Risen Energy, told Mercom, “It is unfortunate that BIS came up with a standard (IS 14286:2010), which is a reference of IEC 61215/61730:2005 edition). This standard is globally outdated; the current global IEC standard is the one from the 2016 edition. Every module manufacturer is wasting around six months and about ₹4 million ($57,000) for each module they register for this BIS registration purpose. Benefits of the move remain unknown.”
According to Ponesekar, technology upgrades are happening at a very fast pace in the Chinese solar industry, and because of the BIS registration process, the Indian market was only able to procure outdated module technology.
“The biggest drawback of BIS is that it doesn’t allow the latest technology and new upgraded products to be supplied to India since the modules registered under BIS has to adhere to the Balance of Materials (BoM) which was approved. This restriction makes the Indian buyer lose out on getting the best product. Nobody will spend time and money to keep updating technology to the latest specifications.”
A concern of Ponesekar was in line with the views of Manish Narula, senior director of business development, Jinko Solar, that the cost of registering for the ALMM was high. Both companies mentioned that the current cost of ALMM application of ₹5,000 ($71)/MW of manufacturing capacity was very expensive. A tier-1 manufacturer from China who operates 10 GW of manufacturing capacity would need to shell out an application fee of ₹50 million ($700,000).
“We are in discussion with the MNRE to try and iron out some issues on the challenges we face as module suppliers to get listed on the ALMM. We hope the Ministry reconsiders some of the clauses of the ALMM mechanism,” said Narula.
In June 2019, the MNRE issued guidelines for conducting laboratory tests on solar PV modules. The tests are compulsory for registration with BIS for the implementation of the Solar Photovoltaics Systems, Devices and Component Goods Order 2017.
Bharat Makappati, country head of Znshine Solar, commented on the current state of laboratory testing saying, “India still lacks the appropriate labs to test latest solar technology. This is visible in the case of solar inverters. This may cause a slowdown in the availability of new monocrystalline and multi-crystalline products to developers, depriving them of technology which is available in the international markets.”
Another issue which was voiced by module suppliers was the use of radio frequency identification (RFID) to track each PV module unit. The practice is not only more expensive compared to using barcode labels, but also done in vain since it was introduced to track subsidy grants which are no longer available.
Module suppliers are bearing the brunt of all these issues, leading to increased costs. The MNRE may need to consider revising the regulations based on the latest technologies and realities on the ground. Standards were set to maintain product quality and should not limit solar power generators from accessing the latest in equipment technology and prevent the Indian market from falling behind compared to the rest of the world.
Shaurya is a staff reporter at MercomIndia.com with experience working in the Indian solar energy industry for the past four years in various roles. Prior to joining Mercom, Shaurya worked with a renewable energy developer and a consulting company. Shaurya holds a Bachelors Degree in Business Management from Lancaster University in the United Kingdom.