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India Adds an Unprecedented 16 GW Solar Capacity in 9M 2024

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MNRE Sets Terms for Real Estate Developers to Avail CFA Under PM Surya Ghar

ENGIE to Build 22 MW Solar Project for Saudi Cement Factory

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					</table><a href="https://www.mercomindia.com/solar-corporate-funding-billion-in-2024" target="_blank" rel="noopener">Total corporate funding, including venture capital, public market activity, and debt financing for the solar sector, reached $22.3 billion in the first nine months (9M) of 2024, a 23%</a> decrease from the $28.9 billion raised during the same period in 2023. The number of deals also dropped by 6% year-over-year, with 117 deals in 9M 2024 compared to 124 in the same period in 2023, according to the recently released report 9M and Q3 2024 Solar Funding and M&amp;A Report by Mercom Capital Group. Raj Prabhu, CEO of Mercom Capital Group, said, “One of the main reasons why the industry is down right now is obviously interest rates and higher costs of capital, which we’ve been mentioning for the past year or so. These factors remain critical. A lot of trade barriers are coming up, and they’re unpredictable. Markets don’t know what policies are coming next. We see this in the U.S., India, and the EU, which is affecting supply chains and prices.”
<a href="https://www.mercomindia.com/reimposition-of-almm-pushes-5-gw-of-solar-open-access-projects-to-2025" target="_blank" rel="noopener">In the first half (1H) of 2024, India added 3.6 GW of solar open access capacity, a 153% increase from the 1.4 GW installed in 1H 2023, according to Mercom’s Q2 2024 India Solar Open Access</a> Market Report. The capacity added in the first half of this year surpassed the total annual installations of any previous year. India’s cumulative installed solar open access capacity was 16.3 GW as of June 2024. In Q2 2024, about 1.8 GW of solar open access capacity was added in the country, a marginal 2.5% drop quarter-over-quarter and a 152% year-over-year increase. With the suspension of the Approved List of Models and Manufacturers order between Q4 2023 and Q1 2024, developers imported significant capacities of modules during the period driving project installations in 1H 2024.
<a href="https://www.mercomindia.com/gerc-approves-tariffs-of-%E2%82%B93-24-%E2%82%B93-30-kwh-for-832-mw-wind-solar-projects" target="_blank" rel="noopener">The Gujarat Electricity Regulatory Commission has approved the tariff for Gujarat Urja Vikas Nigam Limited (GUVNL’s) 832 MW power procurement from grid-connected wind-solar</a> hybrid power projects (Phase II). The total capacity includes base and greenshoe capacity. The Commission directed GUVNL to sign power purchase agreements with the successful bidders at tariffs between ₹3.24 and ₹3.30(~$0.038-$0.039)/kWh for base capacity and ₹3.24(~$0.038)/kWh for greenshoe capacity. GUVNL floated a tender on February 14, 2024, to procure power from a 500 MW grid-connected wind-solar hybrid power project (Phase II), with a greenshoe option of up to 500 MW. It received four bids for an aggregate capacity of 520 MW.
<a href="https://www.mercomindia.com/gujarat-issues-draft-tender-for-1600-mwh-bess" target="_blank" rel="noopener">The Gujarat Urja Vikas Nigam (GUVNL) has issued a draft tender to set up projects of 200 MW/1600 MWh standalone battery energy storage (long duration energy storage) systems in</a> Gujarat under tariff-based competitive bidding (Phase-V). Stakeholders have until November 10, 2024, to provide feedback on the draft tender. The BESS will have a 200 MW / 1600 MWh capacity, capable of delivering one full cycle per day, resulting in a daily cumulative capacity of 1600 MWh. The system will be charged by drawing power from the Gujarat Energy Transmission Corporation (GETCO) and will inject power back into the GETCO network according to dispatch instructions from the State Load Dispatch Centre in coordination with GUVNL.
<a href="https://www.mercomindia.com/gensol-matrix-to-develop-green-steel" target="_blank" rel="noopener">Gensol Engineering has partnered with Matrix Gas &amp; Renewables for a green steel production facility using 100% green hydrogen and employing direct reduced iron vertical shaft</a> technology to convert iron ore into sponge iron. The project is one of three pilot projects approved by the Ministry of Steel and the Ministry of New and Renewable Energy under the National Green Hydrogen Mission. The project’s capital expenditure (CAPEX) is estimated at ₹3.21 billion (~$38.18 million), with the Indian government providing 50% CAPEX incentives. This technology, created for Indian-grade ore, would help Matrix achieve its larger objective of setting up green steel factories similar to those for medium to small-scale producers in Odisha, Chhattisgarh, and other parts of India.
<a href="https://www.mercomindia.com/hindustan-zinc-to-procure-530-mw-renewable-energy-from-serentica" target="_blank" rel="noopener">Integrated mining and resources company Hindustan Zinc will procure 530 MW of round-the-clock power from Serentica Renewable India’s renewable energy projects under a group</a> captive arrangement. Serentica will supply the power for 25 years. The procurement of 530 MW includes two previous power delivery agreements entered into between Hindustan Zinc and Serentica. Hindustan Zinc’s board of directors has approved investing ₹3.27 billion (~$38.96 million) in Serentica and its affiliates for a 26% equity stake. Serentica or its affiliates will create captive power projects in different parts of India based on location suitability and provide renewable power to Hindustan Zinc on a long-term basis. The projects will be commissioned in phases by 2027.
<a href="https://www.mercomindia.com/pfc-consulting-evacuate-andhra-pradesh" target="_blank" rel="noopener">PFC Consulting has invited bids to select a transmission service provider to set up an inter-state transmission system at Ananthapur-II Renewable Energy Zone (Phase I) in Andhra</a> Pradesh to evacuate an additional 4.5 GW of renewable energy. The last day to submit the bids is December 19, 2024. Bids will be opened on the same day. Bidders must furnish a non-refundable fee of ₹500,000 (~$5,947) towards the document’s cost. They must also remit a bid bond of ₹515 million (~$6.12 million). Selected bidders must submit ₹1.29 billion (~$15.34 million) as a contract performance guarantee within ten days from the date of issue of the letter of intent. This project will enable the immediate integration and evacuation of power from approximately 4.5 GW of renewable energy generation projects in the Ananthapur area, with a total identified potential of 20 GW.
<a href="https://www.mercomindia.com/ntpc-rel-floats-tender-for-600-mw-solar-project-in-maharashtra" target="_blank" rel="noopener">NTPC Renewable Energy has invited bids for the land and power evacuation package for a 600 MW interstate transmission system (ISTS)-connected solar project in Dhule,</a> Maharashtra. The last date to submit bids is November 20, 2024. Bids will be opened on the same day. Bidders must submit ₹22,500 (~$267.61) to purchase the bid documents. They must arrange for government/private contiguous land (5 acres/MW) on a freehold/leasehold basis near Dhule PS ISTS substation, Maharashtra. The lease period will be for at least 29 years and 11 months.
<a href="https://www.mercomindia.com/jsw-neo-energy-to-acquire-125-mw-wind-energy-projects-from-hetero-group" target="_blank" rel="noopener">JSW Neo Energy, a subsidiary of JSW Energy, has decided to acquire three wind energy projects of Hetero Wind Power with a cumulative capacity of 125 MW for an enterprise</a> value of ₹6.3 billion (~$74.93 million). The company recently executed definitive agreements with the Hetero Group to acquire its three wind power special purpose vehicles – Hetero Wind Power, Hetero Wind Power (Pennar), and Hetero Med Solutions. JSW will acquire 100% shares in Hetero Wind Power (Pennar) and Hetero Med Solutions and 74% shares in Hetero Wind Power, where the captive consumer will continue to hold ~26% shares. These wind projects operate primarily in Andhra Pradesh and Maharashtra and have long-term power purchase agreements (PPAs). The acquisition is expected to be completed within 90 days. The three target companies’ cumulative revenue from operations in FY 2023-24 was ₹1.44 billion (~$17.12 million).

Daily News Wrap-Up: Solar Corporate Funding Fell 23% in 9M 2024

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					</table><a href="https://www.mercomindia.com/india-15-gw-solar-1h-2024" target="_blank" rel="noopener">India added 14.9 GW of solar capacity in the first half of calendar year 2024, a 282% year-over-year (YoY) increase</a>, according to Mercom India Research’s latest Q2 2024 India Solar Market Update. The installations topped all previous half-yearly and annual installations. The commissioning of several previously delayed projects contributed to capacity additions in the year’s first half. Solar capacity added in the second quarter (Q2) of 2024 stood at 5 GW, up 170% YoY from 1.8 GW. However, installations fell 49% quarter-over-quarter from 9.9 GW.
<a href="https://www.mercomindia.com/enabling-policies-drive-rajasthans-solar-open-access" target="_blank" rel="noopener">According to Mercom India’s Q1 2024 Solar Open Access Market Report, India added 1.8 GW of solar open access capacity in Q1 2024</a>, with Rajasthan leading with almost 28% of the quarter’s installations. Rajasthan’s capacity additions were up 154.1% quarter-over-quarter, making it one of the top five states for solar open access. The state’s cumulative installed solar open-access capacity rose 65.9% between Q4 2023 and Q1 2024. In Q1 2024, about 13.7% of the large-scale solar installations in the state were in the open-access model. Open-access solar installations in Rajasthan accounted for 8.8% of India’s cumulative capacity.
<a href="https://www.mercomindia.com/indias-wind-energy-installations-fell-32-yoy-in-q2-2024" target="_blank" rel="noopener">India added 770 MW of wind energy capacity in Q2 2024, down 32% YoY from 1,139.9 MW in Q2 2023</a>. The capacity additions fell 33% quarter-over-quarter, according to Mercom India Research. Installations in the quarter decreased mainly due to delays in granting grid connectivity. Additionally, land availability, right-of-way challenges, and the early onset of the monsoon in some states also affected wind project development during this period. Karnataka led the capacity additions with 450 MW. Of the remaining 320 MW, Tamil Nadu added 186 MW, Gujarat 130 MW, and Maharashtra 4.2 MW, respectively.
<a href="https://www.mercomindia.com/renewables-share-in-indias-power-capacity-mix-rose-to-44-in-q2" target="_blank" rel="noopener">Solar power accounted for 19.4% of India’s total installed power capacity and 44.2% of the installed renewable capacity in the second quarter (Q2)</a> of the calendar year 2024, up from 15.9% and 38.4% year-on-year, respectively. India’s installed renewable energy capacity, including large hydro projects, stood at 196.4 GW at the end of Q2 2024, accounting for a 44% share of the overall power capacity mix, according to data from the Central Electricity Authority, Ministry of New and Renewable Energy, and Mercom’s India Solar Project Tracker. The total renewable energy (190.6 GW) share was 43.1% of the overall power mix at the end of Q1 2024.
<a href="https://www.mercomindia.com/solar-power-generation-hits-36-bu-in-q2" target="_blank" rel="noopener">In the second quarter of the calendar year 2024, India scaled a new high with solar power generation reaching 36 billion units</a> (BU), a 17.6% increase year-over-year. India added 10.1 GW of solar capacity in Q1 2024, a 399.4% increase from Q1 2023 when only 2 GW was installed. The country’s cumulative installed solar capacity stood at 82.1 GW at the end of Q1, according to Mercom India Research’s Q1 2024 India Solar Market Update. Rajasthan, Tamil Nadu, and Karnataka led the solar power generation during the quarter. Rajasthan was the leader with 12.7 BU. Tamil Nadu was second at 4.8 BU, increasing from 3.9 BU in Q1. Karnataka ranked third with 4 BU compared to 4.3 BU in Q1 2024.
<a href="https://www.mercomindia.com/india-rooftop-solar-1h-2024" target="_blank" rel="noopener">India added 1.1 GW of rooftop solar capacity in the first half of calendar year 2024, the highest half-yearly installations</a> to date, according to Mercom India’s newly released Q2 2024 India Rooftop Solar Market Report. The capacity addition was about a 26% year-over-year (YoY) increase from the 873 MW installed in 1H 2023. Rooftop solar capacity additions in the second quarter (Q2) of 2024 were unprecedented, with 731 MW, up 89% YoY from 388 MW. Sequentially, capacity additions grew by 99% from 367 MW. Rooftop solar accounted for almost 15% of total solar installations in the quarter.
<a href="https://www.mercomindia.com/rajasthan-first-state-50-solar" target="_blank" rel="noopener">Rajasthan has become the first state in India to achieve more than 50% solar in its total installed power capacity</a>, according to Mercom’s India Solar Project Tracker. The state has approximately 23 GW of solar capacity, representing 51% of its total installed power capacity. Solar energy also dominates Rajasthan’s renewable portfolio, accounting for 76% of its total installed renewable energy capacity. In 2022, Rajasthan became the first state in India to surpass 10 GW of cumulative large-scale solar installations. Rajasthan is the top solar state in India, housing a quarter of India’s cumulative large-scale solar capacity.
<a href="https://www.mercomindia.com/data-centers-drive-demand-for-renewable-energy" target="_blank" rel="noopener">With over 880 million internet users and a thriving tech sector, India’s data center industry has seen explosive growth</a> in recent years and is poised to accelerate with the advent of artificial intelligence. This expansion, however, comes with a significant electricity demand, straining the country’s already stressed power grid. Power demand from data centers in India grew at 4.4% year-on-year to reach 139 billion kWh in June 2023, according to Rohan Sheth, Vice President, Colocation &amp; DC Build at data center company Yotta. Meanwhile, the International Energy Agency estimates that by 2030, data centers alone will consume about 8% of total energy globally. Data centers currently consume about 1-1.5% of global energy and contribute to 0.3% of global emissions.
<a href="https://www.mercomindia.com/central-electricity-authority-approves-2600-mw-pumped-storage" target="_blank" rel="noopener">The Central Electricity Authority (CEA) has approved two pumped hydro storage projects (PSPs) with a cumulative capacity of 2,600 MW</a>. The Power Ministry said the CEA approved the two projects in record time. The approved PSPs were the 600 MW Upper Indravati project in Odisha, which is being developed by the Odisha Hydro Power Corporation, and the 2,000 MW Sharavathy project in Karnataka, which Karnataka Power Corporation is developing. The Power Ministry said that the CEA had received proposals for PSPs with a total capacity of 60 GW to prepare detailed project reports.
<a href="https://www.mercomindia.com/solar-manufacturers-delisting-almm" target="_blank" rel="noopener">The Ministry of New and Renewable Energy (MNRE) has amended the Approved Models and Manufacturers of Solar Photovoltaic</a> Modules (Requirement for Compulsory Registration) Order, 2019. One clause has been modified, and two new clauses have been added. According to the new amended clause, inspection and final enlistment for provisionally enlisted manufacturers must be completed within two months of the application. If the National Institute of Solar Energy has completed the inspection but MNRE has not received the recommendation, the provisional enlistment will automatically become final after two months. The provisional enlistment will be revoked if solar photovoltaic manufacturers cause the inspection delay.
<a href="https://www.mercomindia.com/cerc-deviation-settlement-guidelines" target="_blank" rel="noopener">The Central Electricity Regulatory Commission has issued the Central Electricity Regulatory Commission</a> (Deviation Settlement Mechanism and Related Matters) Regulations, 2024. These regulations seek to ensure, through a commercial mechanism, that grid users do not deviate from their schedule of drawal and injection of electricity in the interest of security and stability of the grid. These regulations will apply to all grid-connected regional entities and other entities engaged in the inter-state purchase and sale of electricity.
<a href="https://www.mercomindia.com/karnataka-frames-regulations-for-peer-to-peer-solar-energy-transactions" target="_blank" rel="noopener">The Karnataka Electricity Regulatory Commission (KERC) has introduced the KERC (Implementation of peer-to-peer</a> Solar Energy Transaction) Regulations, 2024 to promote renewable energy and innovative technologies. The regulations, which apply to all distribution licensees and eligible consumers in Karnataka, aim to facilitate the transaction of rooftop solar energy through blockchain-based platforms, enabling consumers to sell surplus power directly to other consumers. The new regulations are built on the KERC (Implementation of Solar Rooftop Photovoltaic Power Plants Regulations, 2016, which allowed consumers to inject energy into the grid under net or gross metering arrangements.
<a href="https://www.mercomindia.com/pm-surya-ghar-targets-each-in-800-districts" target="_blank" rel="noopener">The Ministry of New and Renewable Energy has issued operational guidelines to set up one model solar village</a> in every district of the country under the PM-Surya Ghar: Muft Bijli Yojana. An amount of ₹8 billion (~$95.2 million) has been allocated for this component, with a provision of ₹10 million (~$119,110) in central financial assistance for each model village. The primary objectives of the model solar villages are to facilitate access to clean and green energy in rural areas through rooftop solar systems and to reduce dependency on utilities. The program will also promote solar-based home lighting, water systems, agricultural pumps, and streetlights.
<a href="https://www.mercomindia.com/fdi-india-renewable-sector-2024" target="_blank" rel="noopener">Foreign Direct investment (FDI) in India’s renewable energy sector saw a rise of 50% year-over-year in the financial year</a> (FY) 2023-24. FDI in renewables stood at $3.76 billion (₹315.84 billion) compared to $2.5 billion (₹206.5 billion) the last financial year, according to Ministry of Commerce and Industry data. The cumulative FDI in the renewable sector stood at $17.07 billion (₹1,336.08 billion) between FY 2010-11 and FY 2023-24. Currently, FDI of up to 100% is allowed in the renewable energy sector under the automatic route, with no prior government approval needed.
<a href="https://www.mercomindia.com/green-energy-from-minimum-banking-stipulation" target="_blank" rel="noopener">The Ministry of Power has clarified that energy obtained through open access arrangements, either through a third-party supplier</a> or captive generation, will not constitute a part of the permissible capacity of banked energy. The clarification, which relates to the banking provisions under the Electricity (Promoting Renewable Energy Through Green Energy Open Access) Rules, 2022, addresses stakeholder queries about interpreting the permissible quantum of banked energy, particularly concerning the minimum requirement of 30% of total monthly consumption. The calculation of the permissible quantum of banked energy, which must constitute a minimum of 30% of total monthly consumption, is limited to energy procured directly from the distribution licensee.
<a href="https://www.mercomindia.com/installers-fear-rooftop-solar-demand-surge-may-spark-inverter-shortage" target="_blank" rel="noopener">The launch of the PM Surya Ghar: Muft Bijli Yojana in February of this year has sparked a huge demand for string inverters</a>, with installers saying the supply situation is tight. According to manufacturers, the demand for string inverters has risen as high as 300% since the introduction of the ambitious residential rooftop solar program, which aims at solar systems on the rooftops of 10 million households by 2026-27. The Ministry of New and Renewable Energy has constituted a mission directorate to ensure the achievement of the goals and oversee the day-to-day operations. Since the launch of the latest subsidy program for residential rooftop solar, there has been a 170% increase in applications between February and June 2024, reaching 14.8 million by June.

Month in a Minute: Top Headlines from the Indian Renewable Sector in August 2024

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					</table><a href="https://cleantechsolar.com/" target="_blank" rel="noopener">Cleantech Solar</a>, a provider of renewable energy solutions in India and Southeast Asia, has secured ₹8.55 billion (~$103 million) in long-term green financing from Aseem Infrastructure Finance (<a href="https://aseeminfra.in/" target="_blank" rel="noopener">AIFL</a>).
The financing will support Cleantech Solar&#8217;s open-access portfolio in India, specifically for constructing and operating solar and wind power projects across multiple states.
The company said the loan facility aligns with Cleantech Solar&#8217;s commitment to expanding its commercial and industrial (C&amp;I) portfolio, which currently stands at 1.2 GW.
The renewable energy generated from these open-access projects will be supplied to corporate consumers, helping them meet their energy needs for manufacturing and business operations while reducing their carbon footprint.
Virender Pankaj, CEO of Aseem Infrastructure Finance, said, &#8220;Aseem Infrastructure Finance is glad to partner with Cleantech Solar to provide long-term debt financing that will significantly contribute to the expansion of their Open-Access green energy portfolio… this collaboration with Cleantech Solar reiterates our unwavering dedication to sustainability and our confidence in the transformative potential of renewable energy projects.&#8221;
Sachin Jain, CEO of Cleantech Solar, said, &#8220;It has been an honor to be the preferred renewable energy partner for some of the world&#8217;s leading corporations, helping them run operations sustainably and economically whilst contributing to a greener grid. This financing from Aseem Infrastructure Finance will accelerate the implementation of our open-access renewable energy projects in India and help advance towards a more resilient and environmentally conscious energy landscape, driving positive change for the industry and the planet.&#8221;
Cleantech Solar had secured ₹6.25 billion (~$74.9 million) in green financing from Tata Capital earlier this year.
In January, photovoltaic modules manufacturer First Solar <a href="https://www.mercomindia.com/first-solars-module-facility-procure-renewable-cleantech" target="_blank" rel="noopener">entered</a> into a 15-year captive power purchase agreement with Cleantech Solar to set up 150 MW of solar and 16.8 MW of wind power projects in Tamil Nadu.
Last year, Cleantech Solar <a href="https://www.mercomindia.com/cleantech-solar-commissions-37-mw-solar-maharashtra" target="_blank" rel="noopener">commissioned</a> a 37 MW solar power project in Maharashtra to supply power to a global industrial manufacturing firm through open-access under the captive model.

Cleantech Solar Secures $103 Million for Renewable Energy Projects in India

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					</table><a href="https://www.mercomindia.com/q1-2024-india-highest-solar-open-access" target="_blank" rel="noopener">India added over 1.8 GW of solar open access capacity in the first quarter of the calendar year 2024, a nearly 152% increase year-over-year</a> compared to 722 MW, according to the newly released <a href="https://www.mercomindia.com/product/q1-2024-mercom-india-solar-open-access-market-report" target="_blank" rel="noopener">Q1 2024 Mercom India Solar Open Access Market Report</a>. The installations also represent a two-fold quarter-over-quarter increase from 909.3 MW. Falling module prices drove the rise in installations due to surplus production in China and the suspension of the Approved List of Models and Manufacturers order for projects commissioned until March 2024.
<a href="https://www.mercomindia.com/guvnl-500-mw-wind-solar-hybrid-auction" target="_blank" rel="noopener">KPI Green Energy, Juniper Green Energy, Hinduja Renewables Energy, and JSW Neo Energy (JSW Energy) were declared winners in</a> Gujarat Urja Vikas Nigam’s auction to procure power from 500 MW grid-connected wind-solar hybrid projects with a 500 MW greenshoe option. KPI Green quoted ₹3.33 (~$0.0399)/ KWh for 50 MW. Juniper won 120 MW at ₹3.34 (~$0.04) /kWh. Hinduja quoted ₹3.39 (~$0.0406)/ KWh for 150 MW.  JSW won 180 MW out of the quoted capacity of 200 MW at 3.39 (~$0.0406)/ KWh under the bucket-filling method.
<a href="https://www.mercomindia.com/ntpc-invites-rooftop-solar-project-at-icmr" target="_blank" rel="noopener">NTPC has invited bids for implementing a 1,153 kW grid-connected rooftop solar power project in Maharashtra for the Indian Council of Medical Research (ICMR).</a> The last date for submitting bids is June 26, 2024. Bids will be opened the next day. The scope of work includes installing solar photovoltaic systems on the rooftops of various ICMR and other government buildings. These systems should be installed in shadow-free areas to maximize power generation for each building.
<a href="https://www.mercomindia.com/rec-trading-on-iex-drops-to-record-low" target="_blank" rel="noopener">The Indian Energy Exchange (IEX) reported a total traded volume of 10,633 million units (MU) in May 2024, a 28.9% increase from the previous year.</a> A volume of 622.2 MU of green energy was traded on the exchange during the month. Electricity volumes reached 9,568 MU, up 21% year-over-year (YoY). Renewable energy certificates (REC) hit 1,055 MU, a 640.3% increase YoY. The REC market recorded an all-time low price of ₹165 (~$1.97) per certificate in the trading session on May 29.
<a href="https://www.mercomindia.com/renew-net-profit-q4-fy2024" target="_blank" rel="noopener">Independent renewable power producer ReNew recorded a total revenue of ₹24.78 billion (~$296.85 million) for the fourth quarter of the financial year 2023-24</a>, a year-over-year decrease of 4.4% compared to ₹25.92 billion (~$310.51 million). The decrease in total income was primarily due to lower revenue recognized for the company’s transmission projects. The net profit for the quarter was ₹609 million (~$7.29 million), up 722.9% YoY from ₹74 million (~$886,491 million).
<a href="https://www.mercomindia.com/solar-wind-adoption-led-to-public" target="_blank" rel="noopener">Lawrence Berkeley National Laboratory researchers have found quantifiable public health and economic benefits of accelerated adoption of</a> solar and wind energy in the U.S. from 2019 to 2022, underscoring the economic and social importance of decarbonization. In a new approach that assessed wind and solar energy benefits beyond their generation costs, subsidies, and electricity market value, LBNL researchers used publicly available data to determine more than three times higher societal costs of transitioning to cleaner energy.

Daily News Wrap-Up: India Adds 1.8 of Solar Open Access Capacity in Q1

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					</table>The recent reimposition of the Approved List of Models and Manufacturers (ALMM) regulation has surprised industry stakeholders as the government withdrew exemptions for open access and unsubsidized rooftop solar projects.
The initial reimposition <a href="https://www.mercomindia.com/almm-reimposed-exempt-open-access-solar-projects-advanced-stages" target="_blank" rel="noopener">order</a> in February was put in <a href="https://www.mercomindia.com/mnre-holds-almm-reimposition-order-abeyance" target="_blank" rel="noopener">abeyance</a> by the Ministry of New and Renewable Energy (<a href="https://mnre.gov.in/" target="_blank" rel="noopener">MNRE</a>) just days after it was notified.
The ALMM regulation, effective April 1, 2024, is now being reimposed in its original form from October 2022, with all categories of projects, including open access and rooftop solar, coming under its purview.
According to <a href="https://www.mercomindia.com/research" target="_blank" rel="noopener">Mercom India Research</a>, a pipeline of 14 GW solar open access projects as of December 2023 could be impacted by the reimposition of the ALMM mandate.
Module Prices May Surge
Solar open access project developers fear that module prices would rise without competition, affecting project costs and higher power tariffs in auctions.
With the ALMM regulation back in its entirety, only modules from the list can be used in the projects. The list still does not feature any international players or modules, which developers fear might lead to a price monopoly in the market in the absence of any competition.
An industry insider Mercom spoke to feels that the initial purpose of the ALMM order is now lost.
“ALMM was originally introduced to ensure that the quality of the imported or manufactured products in India meets a certain standard. It has become more of an artificial trade and technological barrier,” he said.
The recent ALMM <a href="https://www.mercomindia.com/mnre-new-solar-module-almm" target="_blank" rel="noopener">update</a> saw an addition of 3.5 GW of new capacity solar modules, taking the cumulative figure to 37.42 GW.
“Until recently, there was at least a threat of competition, so local manufacturers had to price their modules at competitive prices. We have always seen that if Chinese modules are priced at X, Indian modules will always be X plus one cent. There is no benchmark pricing in place, which will lead to a price monopoly in the market if left unchecked,” the industry insider said.
Price is not the only concern developers have. As one solar open-access developer said, domestic manufacturing capacities to meet the massive demand are as good as non-existent.
Developers Want Export Restrictions
According to a Solar Open Access Developer Mercom spoke to,” It will now be a module manufacturer faction that will decide the prices, whom to sell and whom not to sell. We blocked orders for some modules at certain pricing before the ALMM reimposition, and now they have clearly said that the earlier price will no longer apply but will go up. The  domestic manufacturers can easily say that the Chinese have increased cell prices and that they have no option to increase module prices.”
When the government decided to suspend the ALMM regulation for a year last year, it cited the low annual production capacity of high-rated (500Wp+) modules as the primary reason.
The capacity of modules rated at 500Wp+ continues to be low in the latest ALMM update.
According to Mercom India’s <a href="https://www.mercomindia.com/product/state-solar-manufacturing-india-2024" target="_blank" rel="noopener">State of Solar PV Manufacturing in India 2024</a> report, the country’s cumulative solar module manufacturing capacity reached 64.5 GW at the end of December 2023. Yet, only 37.42 GW is listed in the ALMM.
The industry insider said the government cannot support high-growth industries in adopting affordable and sustainable green power solutions unless it directs domestic module manufacturers to supply within India first and then export the excess quantity only.
Developers have often raised concerns about domestic manufacturers choosing exports for better returns rather than meeting local demand.
The solar open access developer called for export restrictions on solar modules from India, mandating that they prioritize local demand against exports.
Higher Tariffs
With ALMM back in play, the industry fears module costs are expected to increase by 15-20%, necessitating reworking power purchase agreements.
Sharad Pungalia, MD &amp; CEO at <a href="https://amplussolar.com/" target="_blank" rel="noopener">Amplus Solar</a>, said, “Imposition of ALMM requirement on open access projects may cause disruptions and adjustments to the installation pipeline in the immediate future. Considering the demand-supply mismatch for the ALMM-compliant modules, we foresee price escalations, especially for the higher-efficiency modules, directly impacting the economics for the planned projects.”
An increase in PPA prices would upset C&amp;I consumers, who were looking to transition to renewables to save on power costs.
The industry insider said, “With the ALMM reimposed, we have no choice but to revise our tariffs. If the customers are annoyed, we must explain the reality to them.”
Technology and Quality
The challenges are not expected to be limited to cost but also to the technology and quality of these modules.
According to Pungalia, the efficiency differences might lead to readjustments to future planned project designs and capacities, eventually impacting the installation timelines.
As India works toward climbing the module technology ladder, most solar manufacturers continue to produce P-type modules, whereas China has opted for N-type and advanced technologies.
According to the industry insider, only 20% of the manufacturers in the country today have module lines for N-type technologies, while the rest still manufacture P-type technologies. He feels that in the process of helping the domestic industry, the ministry is ‘depriving’ the country of the latest technologies.
Developers claim that Indian modules generate 1 to 2% less energy than their Chinese counterparts, primarily due to the semi-automated supply lines.
The industry insider suggested that the ministry allow four to five reputable Chinese manufacturers on the list to keep the competition alive. This would encourage other manufacturers to establish better manufacturing lines and supply high-quality products. Otherwise, the pricing would never be clear and competitive, and technology would become obsolete.
A few open-access developers hope the government will allow private projects to import modules, at least for C&amp;I segment projects, which form a smaller segment compared with utility-scale projects.
They feel this would allow time for sufficient manufacturing capacity to be established and then phase out the exemption over the next six months.
Awaiting Clarity
Pungalia claimed that Amplus had informed the ministry about the planned projects where modules are procured and stored at the site but are yet to be commissioned due to factors beyond its control. He said he hopes to receive the exemption mentioned by the MNRE in the order.
However, a few other project developers are waiting for the MNRE to clarify which agency would handle the inspection part of the ‘procured modules at project site’ clause.
The industry insider raised doubts about whether all the states would take cognizance of the ALMM mandate. States could demand exemptions for their projects.
Some open access developers also have concerns about approvals from state agencies for projects where modules are in transit unless MNRE categorically allows them.
India needs to install about 26 GW of solar capacity annually to meet its 280 GW target set for 2032, so adequate module supply will be imperative. Domestic manufacturing must meet the demand and offer prices and technology on par with international players.

Solar Open Access Developers Fear Higher Module Prices After ALMM Reimposition

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					</table>Solar open access installations grew by 24% in the second quarter (Q2) of the calendar year (CY) 2023 compared to the previous quarter, adding 712 MW of capacity, according to the recently published <a href="https://www.mercomindia.com/product/q2-2023-mercom-india-solar-open-access-market-report" target="_blank" rel="noopener">Q2 2023 Mercom India Solar Open Access Market Report</a>.
Throughout the quarter, module prices continued to decline, which reduced project costs and enhanced the attractiveness of power purchase agreements (PPAs), thereby boosting the growth of solar open access capacity.
Compared to Q2 2022, when developers hurried to complete projects due to concerns about module supply after the Approved List of Models and Manufacturers (ALMM) order became mandatory for solar open access installations from October 1, 2022, installations decreased by 3.6% in the quarter.
<a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/09/Open-Access-Article-1.png"><img loading="lazy" decoding="async" class="alignnone wp-image-58389 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/09/Open-Access-Article-1.png" alt="Open Access Article 1" width="701" height="345" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/09/Open-Access-Article-1.png 701w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/09/Open-Access-Article-1-300x148.png 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/09/Open-Access-Article-1-650x320.png 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/09/Open-Access-Article-1-624x307.png 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/09/Open-Access-Article-1-600x295.png 600w" sizes="(max-width: 701px) 100vw, 701px" /></a>
&#8220;Cost is not the only factor now for the commercial and industrial (C&amp;I) segment. They are focused on achieving their decarbonization goals on time. The growing demand from the C&amp;I segment has led to an increase in installations. The decrease in module prices was another major reason for installations going up,&#8221; commented Priya Sanjay, Managing Director at Mercom India.
The main drivers behind the increase in solar open access capacity additions across states were the captive and group captive models. These projects benefit from exemptions on cross-subsidy and additional surcharges, resulting in greater cost savings for consumers than other forms of open access transactions relative to the state&#8217;s retail electricity tariffs.
&#8220;Renewable energy has become an integral part of the C&amp;I segment. They can only achieve this through rooftop solar adoption, green tariffs by DISCOMs, or procuring through open access. In 2021, open access projects accounted for about 14% of the total utility-scale projects installed; in 2022, it was 21%, and right now (1H), it is 36%. Foreign direct investment is readily available, and banks are also lending to green open access projects. So, things are improving on all fronts,&#8221; Priya Sanjay explained.
In Q2 2023, the highest solar open access installations were in Gujarat, with more than 46% of the total capacity additions. This was followed by Karnataka with more than 21% and Tamil Nadu with 10%.
The top five states accounted for over 96% of all installations during that quarter.
<a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/09/Open-Access-Article-2-1.png"><img decoding="async" class="alignnone wp-image-58391 size-full" style="width: 60%;" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/09/Open-Access-Article-2-1.png" alt="Open Access Article 2" width="60%" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/09/Open-Access-Article-2-1.png 398w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/09/Open-Access-Article-2-1-150x150.png 150w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/09/Open-Access-Article-2-1-100x100.png 100w" sizes="(max-width: 398px) 100vw, 398px" /></a>
&#8220;In Gujarat, the Gujarat Electricity Regulatory Commission amended the wind-solar hybrid policy. The state has large power consumers, and Gujarat is a well-established industrial state. The health of distribution companies is also very good. In Q2 2023, wind-solar hybrid projects accounted for 86.6% of the total installations in the state,&#8221; Priya Sanjay noted.
Diverse sectors such as automotive, mining, and electronic manufacturing in Karnataka took to solar open access during the quarter. In April 2023, the state introduced amendments to its banking policy, enhancing transparency in open access charges and improving the accuracy of open access power scheduling for load despatch centers.
The primary driver behind the surge in open access adoption in Tamil Nadu during the quarter was the state&#8217;s decision to increase the retail tariffs.
1H 2023
In the first half of 2023, India recorded an addition of 1.3 GW in solar open access capacity, a decrease of nearly 18% compared to the 1.6 GW installed in the same period in 2022.
By June 2023, India&#8217;s cumulative solar open access capacity had reached 9.8 GW.
Karnataka maintained its position as the leading state, representing more than 34% of the cumulative solar open access capacity at the end of 1H 2023. Maharashtra accounted for over 13%, and Tamil Nadu 10% of the total installed solar open access capacity.
The top five states contributed almost 73% of the cumulative open access solar installations.
At the end of Q2 2023, India had 9.2 GW of solar open access project pipeline in various stages of development.
Commenting on the impact of green open access on installations, Priya Sanjay said, &#8220;Most of the states have started implementing green open access regulations. However, each state has a different banking policy. Many states have increased the banking charges, which will impact the solar open access growth in the coming quarters to an extent.&#8221;
Karnataka emerged as the primary seller in the Green Day Ahead Market (G-DAM) within the short-term markets, commanding more than 57% of the market.
Maharashtra held the leading position in energy procurement from G-DAM, followed by the Damodar Valley Corporation, constituting 32% and 11% of the total power purchased.
The trading of Renewable Energy Certificates on the Indian Energy Exchange (IEX) saw a significant decline of nearly 47% from the previous quarter.
The report also noted that the volume traded in the Green Term Ahead Market (G-TAM) on the IEX fell by approximately 20% QoQ.
The report offers an in-depth analysis of the solar open access business landscape, retail electricity tariffs, and open access charges and costs for 17 states.
Additionally, the report includes information on the average PPA prices, net landed costs, and open access policies and regulations released in Q2 2023.
Furthermore, the report features insights and perspectives from leading open access installers across the country during the quarter.
The &#8220;Q2 2023 Mercom India Solar Open Access Market Report&#8221; report is 151 pages long and covers vital information and data on the market. For the complete report, visit: <a href="https://www.mercomindia.com/product/q2-2023-mercom-india-solar-open-access-market-report" target="_blank" rel="noopener">https://www.mercomindia.com/product/q2-2023-mercom-india-solar-open-access-market-report</a>

India’s Solar Open Access Installations Up 24% QoQ in Q2 2023

India’s solar open access installations totaled 209 MW in the second quarter (Q2) of 2021, a 664% year-over-year (YoY) increase compared to 27 MW in the same period last year, according to Mercom’s India Solar Open Access Market <a href="https://mercomindia.com/product/india-solar-open-access-market-report-q2-2021">Report</a> Q2 2021.
Uttar Pradesh added the largest solar open access capacity in Q2 2021, followed by Chhattisgarh and Maharashtra. The top three states accounted for 83% of installations in the quarter.
Cumulative installations in the solar open access market have reached 4.5 GW as of June 2021.
Installations in Q2 declined 50% <a href="https://mercomindia.com/open-access-solar-projects-q1-2021/">compared</a> to the previous quarter (419 MW ) due to the impact of the second wave of COVID-19. However, they are expected to increase with over 1.1 GW projects in the pipeline. The government is promoting green open access under the ‘Draft Electricity (Promoting Renewable Energy Through Green Energy Open Access) Rules, 2021.
The solar open access market installed 628 MW of capacity in the first half (1H) of 2021, a 12-fold growth compared to 47 MW installed in the same period last year. Uttar Pradesh led the way with the highest installations in 1H 2021, followed by Maharashtra and Tamil Nadu.
According to the report, Uttar Pradesh, Rajasthan, and Chhattisgarh currently have conducive open access policies. The commercial segment also has potential for captive open access projects in Maharashtra.
<img loading="lazy" decoding="async" class="aligncenter size-full wp-image-29338" src="https://mercomindia.com/wp-content/uploads/2021/09/fdgfsdgv-1.png" alt="Mercom India Solar Open Access Market Report Q2 2021" width="541" height="347" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2021/09/fdgfsdgv-1.png 541w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2021/09/fdgfsdgv-1-300x192.png 300w" sizes="(max-width: 541px) 100vw, 541px" />As of June 30, 2021, Karnataka is the largest market for solar open access cumulatively, followed by Rajasthan, Madhya Pradesh, Andhra Pradesh, and Tamil Nadu. The top five states account for 73% of the total solar open access market in India.
<a href="https://mercomindia.com/wp-content/uploads/2021/09/State-wise-Solar-Open-Access-Installations-in-Q2-2021-1-1.png"><img loading="lazy" decoding="async" class="aligncenter size-full wp-image-29323" src="https://mercomindia.com/wp-content/uploads/2021/09/State-wise-Solar-Open-Access-Installations-in-Q2-2021-1-1.png" alt="State-wise Solar Open Access Installations in Q2 2021 (%)" width="506" height="295" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2021/09/State-wise-Solar-Open-Access-Installations-in-Q2-2021-1-1.png 506w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2021/09/State-wise-Solar-Open-Access-Installations-in-Q2-2021-1-1-300x175.png 300w" sizes="(max-width: 506px) 100vw, 506px" /></a>
According to the <a href="https://mercomindia.com/product/india-solar-open-access-market-report-q2-2021">report</a>, the demand for procuring renewables in the open access market has increased every quarter. Many corporates are trying to meet their power demands through renewable energy sources.
However, regulatory inconsistency and policy U-turns have hindered the growth of the open access market. State governments are also levying new charges or increasing the existing charges to avoid losing high-paying consumers.
Open access project developers <a href="https://mercomindia.com/uniform-stable-policies-open-access/">believe</a> uniform regulations across states and long-term policies without retroactive changes and charges are necessary for the market to scale.
The average open access tariff in the states covered in this report ranged from ₹3.50 to ₹5.00 ($0.047- 0.068)/kWh with a yearly escalation of 1-2% depending on contract terms.
<blockquote>“DISCOMS need to realize that the demand for renewables cannot be curtailed and have to reconsider the consumer’s right to combatting climate change and choosing their suppliers of power. The power demand from commercial and industrial entities is growing, and eventually, the states will have to invest in new power generation. On the other hand, open access will not only generate revenue without DISCOMs investing but also bring in huge capital from around the globe,” said Priya Sanjay, Managing Director of Mercom India.</blockquote>
The report also provides insight into short-term transactions such as day-ahead market (DAM), bilateral contracts, and real-time market (RTM) within the open access segment. The top five states are compared based on the electricity sold and purchased through each model.
Uttar Pradesh was the top seller in the DAM market in Q1 2021, while Gujarat was the leading purchaser in the DAM market in Q1 2021. The top markets for real-time and bilateral markets are covered in the report.
C&amp;I entities are trying to meet a significant portion of their power demand through renewable energy sources with global commitments like RE100, Science-Based Targets initiative (SBTi), and environmental, social, and governance (ESG). Lack of sufficient space to meet a more significant percentage of power demand has led many corporates to opt for open access. The need for procuring renewables in the open market has only been growing every quarter, the <a href="https://mercomindia.com/product/india-solar-open-access-market-report-q2-2021">report</a> noted.

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