The government of India has been promoting self-reliance and is trying to limit India’s dependence on imports and expand domestic manufacturing capabilities. So far, duties have been the means to restrict imports.

Recently, the Department of Revenue under the Ministry of Finance issued a notification extending the imposition of safeguard duty on the import of solar cells and modules to India for another year starting July 30, 2020. Also, along with the imposition of safeguard duty, the government proposed a 20% basic customs duty (BCD) on all imported solar cells, modules, and inverters. There are speculations that this duty might be in the range of 10-20% on top of the safeguard duty.

According to Mercom India Research, India has approximately 15.5 GW of solar module manufacturing capacity and around 3.3 GW of solar cell manufacturing capacity as of June 2020.

As India tries to maximize the opportunities for solar manufacturing, some innovations and technological advancements are bound to make their way to the Indian market. One such technical upgrade is the increasing size of solar cells and wafers.

Traditionally, the size of solar cells seen in the Indian market has been about 157mm, but now things are set to change. While bigger cells would increase the efficiency of solar systems, it could also mean massive investment for companies, as in many cases, it would mean acquiring new machinery.

Avinash Hiranandani, Global CEO, and Managing Director, RenewSys, said, “With changing technology and cell sizes going up, RenewSys is poised to order state-of-the-art European machinery within the next six months. This will take our capacity from an existing 750 MW to 1 GW. We are also working on a plan to add another 1 GW to our module manufacturing capacity, taking our total capacity to 2 GW in phases. The company is also evaluating an expansion of its cell line and technology, and will be targeting at least 500 MW of new (additional) Indian cell capacity in this project.”

In the absence of a common standard, companies have adopted wafers of varying sizes, which has resulted in increased manufacturing costs throughout the supply chain. With the rise in the size of wafers becoming the norm, it could be difficult for existing cell and module manufacturers to adopt the larger wafer sizes, as capital spending would have to increase on certain upgrades, and new production lines would have to be installed.

A top executive from Hanwha Q CELLS, commented on the trend, saying, “Previously, we were focusing on the 15.78 mm wafers with a module wattage output of 380Wp-405Wp. But things are changing now, and the size of cells is also increasing. Now, the most commonly used wafers are the 166 mm wafers, which have a module wattage output of 440Wp-475Wp. Now, we are concentrating on 182mm solar wafers as we advance. There is a need to streamline the whole process, and we don’t need a massive upgrade in technology to achieve that. Some manufacturers have already started manufacturing 217 mm solar wafers with a module wattage output of 600Wp. Right now, our focus is on 182 mm wafers. The 210 mm wafers have some issues of compatibility with inverters and other products, and we are trying to rectify it.”

“As of now, we have a capacity of 10.8 GW. The situation is not that good in China, and the prices of solar modules and cells are going up. Things are a bit uncertain right now, and there is a shortage of supply. Given the uncertainty surrounding the imposition of BCD, things are going to continue in the same vein in the near future. The rooftop segment has been hit the hardest because of the ensuing pandemic, and it seems that it will take some time before things turn to normal,” the executive added.

Jupiter Solar is planning to add 200 MW of cell manufacturing capacity to the existing facility. The new capacity is expected to be commissioned by December 2020. The company is also planning to come up with a greenfield project for the manufacturing of solar cells.

Speaking on the increase in the size of solar cells, Dhruv Sharma, CEO of Jupiter Solar Private Limited, said, “ We have equipment that is capable of handling cells of all sizes from 158mm to 210mm. We will be flexible to adapt to what the market demands, and the types of wafers that are regularly available in the market. We are planning to spend ₹500 million (~$6.7 million) to expand manufacturing capabilities and ₹3 billion (~$40.3 million) on new projects.”

Recently, LONGi, along with six other leading companies, announced the M10 silicon wafer standard size (182mm x 182mm) in the development of next-generation silicon wafers, cells and module products. It seems to be a step in the right direction as it would lead to the standardization of wafer sizes. Modules with larger wafers have higher power and can reduce BOS costs, which in turn will reduce the overall cost of the system.

While expanding India’s solar manufacturing capacity is important for the domestic industry’s growth, there is much to be done to lay a solid foundation for local manufacturers.

“BCD is key for any long-term investment planning by domestic solar manufacturers. Preferential duty or equalization levy for special economic zones (SEZs) has to be announced along with the announcement of BCD. A ‘Tech Upgrade Fund’ will be of prime importance as well. Due to the fast-paced nature of this industry, various technology upgrades are required,” Hiranandani added.

The bigger-sized cells and wafers have several benefits, but then again, India has been an extremely price-sensitive market. The associated expenditure with adopting these new sizes could deter many manufacturers from taking the leap. So far, the government has not put out any plans to set up funds for R&D.

“Just look back two years, and you get an idea of how fast technology moves in the global solar industry. Unless technology is constantly upgraded, you could end up with older equipment, obsolete technology, higher priced products with lower efficiency. Announcing new cell and module production units is just the first step, you have to innovate and invest or risk being left behind,” said Raj Prabhu, CEO of Mercom Capital Group.