The government will soon increase the funding allocation for the production linked incentive (PLI) program for manufacturing domestic solar cells and modules to ₹240 billion (~$3.22 billion) from the existing ₹45 billion (~$605.4 million), Union Power Minister RK Singh has said.
PTI quoted the Minister saying that the PLI program for solar cells and modules received bids for a 54.5 GW manufacturing capacity.
“We asked the government to sanction ₹190 billion (~$2.55 billion) more under the PLI, which was approved in principle. Now we would have a PLI of ₹240 billion (~$3.22 billion). We would be exporting solar equipment,” Singh said.
The Minister said that the solar module manufacturing capacity in the country was 8.8 GW while the cell manufacturing capacity was 2.5 GW.
The Indian Renewable Energy Development Agency (IREDA) recently announced the list of successful bidders for setting up manufacturing capacities for a minimum of 10 GW of vertically-integrated high-efficiency solar modules under the PLI program. A PLI totaling ₹44.50 billion (~$598 million) for a total capacity of 10,483 MW was awarded.
The 16 qualified bidders had requested a total PLI of ₹229.94 billion (~$3.07 billion).
Jindal India Solar Energy was awarded a PLI of ₹13.90 billion (~$186.8 million), and Shirdi Sai Electricals a PLI of ₹18.75 billion (~$252 million), for a capacity of 4 GW each. Reliance New Energy Solar was awarded a PLI of ₹11.90 billion (~$160 million) for a capacity of 2,483 MW, according to Mercom sources.
The government said it would consider the PLI for the bidders on the waiting list if the funds were enhanced for the program. The PLI request under the waiting list amounts to ₹185.39 billion (~$2.48 billion).
The PLI program for solar manufacturing
In April this year, the Union Cabinet approved the ₹45 billion (~$605.4 million) PLI program to boost the domestic manufacturing capacity of solar PV modules.
The PLI program aims at adding 100 GW manufacturing capacity of integrated solar PV modules entailing a direct investment of ₹172 billion (~$2.31 billion). With the proposed increase in allocation to ₹240 billion (~$3.22 billion), the quantum of investments and domestic manufacturing capacity envisaged under the PLI program would increase.
Under the PLI program, solar PV manufacturers were selected through a transparent, competitive bidding process. The incentives will be disbursed over five years once the solar PV manufacturing plants start operations and the sales are booked.
Manufacturers will be rewarded for higher efficiencies of solar PV modules and sourcing their material from the domestic market. The PLI amount will increase with increased module efficiency and local value addition.
In November last year, the government said it would allocate ₹1.45 trillion (~$19.61 billion) for ten critical sectors over five years. These sectors include- high-efficiency solar PV modules, advanced chemistry cell (ACC) batteries, and automobiles and auto components. The government will allocate ₹796.42 billion (~$10.75 billion) for these three sectors in the next five years.