Solar PLI Scheme to Benefit Incremental Panels Demand till FY30: Ind-RA Report
India Ratings and Research (Ind-Ra) informed in its report that the solar production-linked Incentive (PLI) scheme will be beneficial to nearly 8-13 per cent of the photovoltaic energy plant requirement till the year 2029-30. The PLI scheme will also aid 20 gigawatt (GW) capacity development in the next five years.
Ind-Ra stated that as per its estimation the allocation of Rs 4,500 crore by the Ministry of New and Renewable Energy (MNRE) towards the solar modules manufacturing industry can benefit the sales of 20 GW from the capacity developed under the PLI scheme across the implementation period of five years.
This estimation is based on the assumption of 100 per cent localisation which means up to 30 GW in case of 65 per cent localization. The sanction of the PLI facility will benefit 4-6 GW of sales every twelve months over five years from commissioning of the beneficiary manufacturing facilities.
PLI scheme will benefit sales up to 50 per cent of the manufacturing capacity fixed by the winning bidder. The estimation is based assuming the base PLI rate of Rs 2.25 watt power and totally greenfield (new) expansion.
In case, plants achieve better module efficiency and temperature coefficient than the minimum requirement mentioned in the notification then the capacity benefitting under the scheme may further reduce from the stated 20GW level.
India has a target to install 280GW of solar power plants by the financial year 2030. At present, 240GW of solar power plants are yet to be implemented. The report stated that according to MNRE notification, the overall extension in timelines for the commissioning of solar power generation projects is limited to six months.
Solar power developers need to commission projects well before April 1, 2022 when the 25 or 40 per cent basic custom duty kicks in for solar cells and modules. The domestic manufacturing capacities will take time to set up thus these capacities will have to come up based on imported modules.