With increased acceptance of high-efficiency monocrystalline (mono) technology in solar projects around the world, Chinese cell and module suppliers are swiftly scaling production of these products.

This shift is occurring rapidly as mono PERC modules are more efficient and can help reduce land and other balance of system (BoS) costs for developers, leading to higher returns. Until now, the Indian market has been slow to adopt the technology due to its price-sensitive nature, but Indian developers have said they will start transitioning when prices drop.

Recently, in its Q1 FY20 earnings announcement the CEO of Jinko Solar, one of the world’s leading module suppliers, stated, “We continue to see strong demand from overseas markets and have secured the vast majority of our order book for the rest of the year. The global solar market continues to generate rapid and sustainable growth momentum as grid parity approaches, in particular for our high-efficiency mono products, which are continuously in short supply. Our global distribution network allowed us to quickly meet the growing demand for our high-efficiency mono products over the past few quarters as the market has transitioned. We are accelerating the expansion of our high-efficiency mono production capacity and estimate they will account for over 60% of our total shipments for the year.”

Module manufacturers such as Longi and JA Solar have shown their conviction in mono products by announcing an increase in mono manufacturing capacities. Indian project developers are also closely watching the market move towards mono PERC modules. Developers are expecting mono module prices to decrease, which would make it easier to replace polycrystalline (poly) modules. The shift which started slowly has picked up steam, especially in Europe and the U.S. Though the Indian market is still mostly consuming poly modules as it is cheaper, the awareness of mono products has increased. Mercom reached out to industry stakeholders to find out how the progress of mono technology modules has been in India.

On the current demand scenario of mono products in India, P. Ponesekar, vice president (Sales) at Risen India said, “Currently, the demand for mono technology modules is not too high in India. This is mainly due to higher cost and a temporary hurdle faced by suppliers in acquiring standardization certificates from Indian authorities, but we do expect that it will pick up next year.”

According to industry sources, Chinese suppliers are cutting down the manufacturing of poly wafer capacities and domestic manufacturers in India are also expected to face a lack of supply in raw materials soon which could result in a spike in prices in the short term.

On the impact of reduction on polysilicon module capacities, Ponesekar commented, “Polysilicon wafer capacity is shrinking drastically, and by the end of 2019, more than 30 GW of poly wafer capacity will disappear, and therefore costs are expected to go up.”

Currently, poly modules are about 15-20% cheaper than mono PERC; however, as technology improves, the price difference between the two is expected to go down.

Manish Narula, senior director-sales at Jinko Solar India, stated, “Indian solar project developers are relatively late to use mono-crystalline modules. However, we are seeing developers who are quality conscious, already developing projects using mono products. We expect the technology to be adopted by the majority of developers gradually.”

Bharat Makkapati, country head of Znshine Solar, said, “More investment is going into mono technology in China; however, we do not expect prices for poly modules to increase. Maybe they can increase in the short-term, but these prices are expected to remain soft after that.”

Indian developers may face some pricing pressures in terms of procuring poly modules in the near-term, but industry experts believe that the prices will eventually come down.

Sunil Rathi, director (sales and marketing) at Waaree Energies, said, “As Chinese players increase the capacity of mono technology modules, the delta between mono and poly modules is expected to come down, this will make mono technology more viable for Indian developers as well. Currently, many module suppliers are facing issues with respect to procuring polycrystalline cells, and prices seem to have hardened. Over the next couple of years, we expect a majority of the new projects to start deploying mono technology modules in India.”

An executive for a large developer told Mercom that they were looking at developing projects using mono technology modules given the benefits of higher efficiency, longevity, and capability to reduce BoS costs. The consensus view from the developers was that, currently, considering a project’s internal rate of return, poly modules remain slightly more viable. Should these prices rise in the near future, solar power generators will seriously consider developing projects using mono technology modules.

“The Indian solar market is primarily polycrystalline dependent due to lower cost. However, we could start seeing a meaningful transition to mono by 2021. Awareness for high-efficiency mono products is there, it is just about making the numbers work,” said Raj Prabhu, CEO of Mercom Capital Group.

In November 2018, Mercom analyzed whether the Indian solar market was ready to transition to mono PERC modules given its advantages.

In a recent interview with Adani Solar, Prashant Mathur, chief marketing officer, told Mercom that further reductions in Indian solar module prices seem unlikely.