The recent ‘Approved List of Models and Manufacturers’ (ALMM) rules published by the Ministry of New and Renewable Energy set 19% as the minimum efficiency for the modules to be listed. The minimum efficiency for modules used in utility/grid-scale power projects is set at 20%; for rooftop solar and solar pumping projects, it is 19.5%, and for solar lighting, 19%.

Although it does not directly ban, it effectively eliminates polycrystalline modules, whose efficiencies have peaked at 17-18% from being listed in the ALMM going forward.

However, not all stakeholders are satisfied with this decision. Several view the removal of polycrystalline modules from the Indian market as stringent and argue that the ALMM efficiency mandate was unwarranted. They believe the government could have allowed the technology to phase out gradually over time.

Although the demand for polycrystalline modules has declined considerably in India, several manufacturers still produce and supply them to small-scale solar projects, especially agricultural solar pumps.

Harsh Jain, Director at Citizen Solar, a Gujarat-based solar module manufacturer, feels that eliminating older technologies must happen through market forces, not by a government diktat.

“It must be the end user’s choice whether they want to use that particular technology or not. The government cannot force this change and place a market ban on polycrystalline modules being used for subsidies or government projects. The ALMM regulation was brought in to safeguard Indian module manufacturers. Only 25 manufacturers in India produce larger modules based on M10 technology. More than a hundred others are still producing polycrystalline modules and risk losing business with this new change. This has also made manufacturers question their business decision if they were to invest in mono-PERC or TOPCon technologies, and the government then mandates using only HJT.”

Polycrystalline modules are now mainly used in agricultural solar pumps and street lights. But with the minimum 19% efficiency mandate, that will be stopped, too. Rajat, Sales and Marketing Specialist at Icon Solar-en Power Technologies, a solar module manufacturer, points out that most projects tend to opt for higher efficiency modules anyway, including smaller ones with up to 5 MW capacities.

While many stakeholders had predicted the end of polycrystalline much earlier, the technology continues to survive because it is cheaper.

A senior executive at a large-scale solar manufacturer said, “The polycrystalline capacities over a period of time may become redundant. The utility-scale project developers have already made the shift to higher efficiency modules as it makes commercial sense, so I don’t see why we need to force it on anybody. The people keen on higher efficiency are already making the shift without any force. So, by making those capacities completely ineffective or banning the sales in India, we are ruining the investments people have made,”

The executive pointed out that the raw material and the supply chain for polycrystalline modules are still in place.

Price Gap Closing

Polycrystalline module manufacturers argue that cost continues to be a major driver for the continued sales in the Indian market. However, in light of the recent module price drop, mono-PERC modules are closing the price gap with polycrystalline at a much faster pace.

According to Mercom India Research, the Indian polycrystalline modules are priced at $0.26/W vs. the Indian mono-PERC at $0.28/W. This is apart from the more competitive prices offered by Chinese manufacturers, who can supply the Indian market in the absence of ALMM regulation for a year.

According to Rajat, the price difference was far wider a few years ago, when polycrystalline was ₹5 (~$0.060)/W to ₹7 (~$0.084)/W cheaper than mono-PERC. This price difference has now narrowed to ₹2 (~$0.024)/W to ₹3 (~$0.036)/W.

One senior executive opined that the cost should not be evaluated only on a per-watt basis but according to the total cost of the module, including the associated balance of structures, cables, inverters, and other elements.

He said, “As technology improves, with lower-efficiency modules, you might have to place ten modules to generate the same energy output as seven high-efficiency modules. So now you save on three module structures, cabling, and inverter costs. Higher efficiency modules work better for rooftop, where the space is usually a constraint.”

Higher efficiencies in solar modules fundamentally mean lower costs in the long term. However, being a cost-sensitive market, India has always lagged in adopting new technology. Since most developers in the country operate on the CAPEX model, they try to keep costs down and often opt for polycrystalline modules priced slightly lower than the others.

According to Jain, polycrystalline module manufacturers have no problem with higher-efficiency modules.

“Polycrystalline modules give almost similar output as the monocrystalline modules in Gujarat, Maharashtra, Rajasthan, and Madhya Pradesh. Monocrystalline works better in certain conditions like low light, making it the most viable option. We still have inquiries for more than 10 MW of polycrystalline modules because of the price benefit. As an entrepreneur, people are happy to save one or two rupees per watt if they get almost the same output,” he said.

However, a question hangs over the availability of after-sales service for polycrystalline modules a few years down the line.

According to Jain, it is important for the government to also understand that solar modules come with a 10-year product warranty and a 25-year performance guarantee. “By eliminating polycrystalline modules by force, we will not be able to service or replace the modules already installed for projects in the country.”

While it is a fact that higher efficiencies derive more output over a long time, the government pushing the preferred efficiencies as a mandate through the ALMM could push polycrystalline manufacturers who invested in the facilities and ALMM listing into a corner.

Icon Solar, which manufactures both polycrystalline (200 MW) and mono-PERC modules (400 MW), caters to all the market demands. Rajat said, “We are market-ready to meet any demands that are out there. For many manufacturers, switching from polycrystalline to mono-PERC would cost ₹1 billion (~$12.03 million) to set up a new facility, subject to their owning the land. This is a big initial investment. This also comes with the fear that the technology might become redundant a few years later.”

On top of this is the expenditure incurred by companies to secure ALMM certification. Said Jain, “As a small manufacturer, I paid about ₹1.5 million (~$18,041) for the ALMM certification, and then within a year, the government suspended ALMM, and now when the time for renewal comes, we are not going to be able to renew our polycrystalline modules listing.”

Over 50 manufacturers have written to the Ministry of Power requesting that polycrystalline modules be allowed to continue.

Raj Prabhu, CEO of Mercom Capital Group, commented, “Establishing higher efficiency standards and encouraging the adoption of innovative new technologies isn’t necessarily displacing polycrystalline modules. And the government does not force manufacturers to invest in polycrystalline or any other technology. That said, I agree that the relevance of polycrystalline modules should be determined by market forces rather than government intervention. But, it goes both ways – the government should neither push the technology out nor provide additional help.”