Indian corporate giants such as Reliance Industries Ltd. and Tata Power Co. are among the bidders for the government’s Rs 19,500-crore ($2.4 billion) incentive scheme for solar module makers, reported Bloomberg. The government is selecting solar PV module manufacturers for setting up manufacturing capacities for high-efficiency solar PV modules in India under the Production Linked Incentive (PLI) scheme.
This is seen as an effort to boost domestic manufacturing and curb panel imports from dominant producer China, the report said. The bids, being conducted by state-run Solar Energy Corp., closed on February 28, after being extended multiple times.
According to people familiar with the matter, other than Reliance Industries Ltd. and Tata Power Co., US firm First Solar Inc. and Indian companies JSW Energy Ltd., Avaada Group, and ReNew Energy Global Plc, have also shown interest in the bid, reported Bloomberg. However, it added that one of India’s largest solar panel makers Adani Group was not among the bidders.
The financial Incentive scheme is a part of the government’s plan to transform the country into a manufacturing powerhouse, boosting employment and lowering imports that can deplete the country’s foreign exchange reserves, the report said.
In September 2022, the Cabinet approved a Rs 19,500-crore production-linked incentive scheme on a ‘national programme on high-efficiency solar PV modules’ with an aim to attract Rs 94,000 crore investment in the sector.
The government is offering grants to take the country’s module-making capacity to as much as 90 gigawatts, enough to meet its own requirements and serve export markets, the report added.
The bids were invited amid worries that the country’s green transition goals are being undermined by the emphasis on domestic manufacturing, which is dragging down initiatives for renewable energy, the report said.
RK Singh, the minister of power, last month said that his department is thinking of temporarily “loosening” a major restriction on module imports in order to forward projects.
Last month in a reply in parliament RK Singh said, “The Government of India is implementing the Production Linked Incentive (PLI) Scheme for National Programme on High-Efficiency Solar PV Modules, for achieving domestic manufacturing capacity of Giga Watt (GW) scale in High-Efficiency Solar PV modules and solar PV cells, with an outlay of Rs 24,000 crores.”
“This Scheme has provision for Production Linked Incentive (PLI) to the selected solar PV module manufacturers for five years post commissioning, on manufacture and sale of High-Efficiency Solar PV modules. The scheme is being implemented in two tranches. Tranche-I has an outlay of Rs. 4,500 crore, under which Letters of Award have been issued to three successful bidders for setting up 8,737 MW of fully integrated solar PV module manufacturing units. For Tranche-II with an outlay of Rs. 19,500 crore, the Scheme Guidelines have been issued on 30.09.2022 and tender document for selection of solar PV manufacturers has been issued on 18.11.2022,” the minister added.