The rooftop is the Achilles’ heel of India’s solar story. The lack of regulations for product quality certification, intense competition, and absence of requisite awareness have only emboldened the problem.
The increasingly fierce competition in the solar industry has resulted in low prices for rooftop installers. Installers are now offering extremely aggressive tariffs as low as ₹3.8-3.9 (~$0.0559)/kWh. At these low rates, the use of poor quality materials has become widespread. Some rooftop installers are bidding for projects in the ₹30.6 million/MW range considered to be completely unviable by many in the industry.
The compromise in quality can be seen in installations across the country. For example, the cables used in rooftop solar systems can often be found to be thin in diameter and of poor quality. Many customers don’t realize that they are getting lower quality cables that are 1.2 MM, 1.3/1.4 MM regular cables instead of the preferred fire-proof cables.
An executive at Vindhya Tele Links a new entrant in the solar PV cable business, told Mercom, “There is no Indian standard for cables, but there is an international standard BSEN 50618 for solar PV cables, and the industry follows this standard. Every cable manufacturer needs to have an in-house testing facility and the certification is given only after having adequate infrastructure and rigorous testing. But many local players also use fake branding and certification to sell their cables.”
Similarly, in structures, lower grade aluminium is used to reduce the overall cost. A standard quality of the steel structure would normally cost ₹3.5 (~$0.0515)-4 (~$0.0589)/W, but few of the local vendors at the location sites are selling in the range of ₹1 (~$0.0147) – 4 (~$0.0589)/W.
There are other quality concerns that are plaguing the rooftop sector. The absence of regulations and standard product quality certification have encouraged fly-by-night operators to provide false or misleading claims about their products. Should the product fail, a consumer will not be able to get coverage under the warranty even if the product is in the warranty period because the company might not be around to provide it.
Mercom’s news team got in touch with a few rooftop installers in the country to dig deeper into the problem. Talking to Mercom, Shyam Sundar, the CEO of Amsun Energy said, “It is easy for bigger players to reduce the price as they procure the materials in bulk, but smaller players cannot offer the same price as they do not have the advantage of economies of scale.”
Elaborating further, he said, “Large developers do not focus on rooftop, but due to a lack of awareness, consumers compare the cost of installation with utility scale and expect similar cost. It is not feasible for a small and medium size rooftop installers to match the cost of a MW installation with a kW installation.”
The rooftop sector is tougher in comparison to the utility segment and most big private players are staying away for now. With the industry still in its nascent phase, the government’s decision to cancel its channel partners program has resulted in the entry of many unqualified installers and material suppliers. The lack of awareness among consumers means they have no idea who a quality installer is.
Manpreet Singh, the director at JS Solar Tech, believes that the standardisation in only equipment and materials are not enough. “There has to be certification of installers too. If not, any electrician can claim to be a solar PV installer. This can prove to be very costly,” he told Mercom.
The situation, however, is very different in developed markets where there are strict quality requirements and getting away with sub-standard products is not easy. But in countries like India and China there is an obsession with showing higher numbers while paying little to no respect to proper quality checks. Too often, the return on investment is also seen only in monetary terms and do not quantify the benefits and factor social and environmental benefits of their green projects.
Sachin Jain, the co-founder and chief executing officer of solar engineering procurement and construction (EPC) firm Oriano Solar in an interview to Mercom had recently commented, “Currently, the country lacks the required awareness and rating system for solar rooftop viability to powering SMEs and households.”
The repercussions of using sub-standard products for solar installations were also seen in utility scale solar projects when parts of northern India were hit with widespread storms recently. Mercom reported that dust storms have affected many solar assets in north India because of these types of cost cutting practices by companies that have used poor quality products for their installations. Even though the affected projects were large-scale, the consequence of poor quality is still evident.
“Poor quality installations if not brought under control will affect all installers in the country as word spreads among consumers about unviable projects and poor-quality installs that may not last long. Though nobody likes over regulation. the current scenario in the residential rooftop segment is untenable,” said Raj Prabhu, CEO of Mercom Capital Group.
India plans to achieve 40 GW of rooftop solar as part of its broader goal of achieving 100 GW of solar capacity across the country by 2022.
According to the Mercom India Solar Project Tracker, India has an installed capacity of ~2 GW of solar rooftop installations as of March 2018.