Mercom expects new solar power capacity addition during 2018 to be around 8.3 GW in India as over 1 GW of utility scale projects will shift their commissioning from 2019 to 2020. (Source: Mercom India Research)
- New PV capacity addition in India during Q2/2018 was 1,599 MW, drop of 52% since last quarter, and the lowest level of installations since Q1/2017, according to Mercom India Research
- Of this, 74% or 1,184 MW came from large scale solar power plants, and 20% or 415 MW from rooftop solar
- A total of 4.9 GW was installed between January and June 2018, as the cumulative installed PV capacity of the country reached 24.6 GW
- ASPs for Chinese modules decreased around 5% QoQ to $0.33 per watt between April 2018 to June 2018, compared to $0.346 per watt in the first quarter of the year
- Project costs dropped as large-scale project costs, went below INR 40 million ($572,473) per MW for the first time
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Uncertainties around safeguard duty implementation, trade cases, auction cancellations are some of the reasons that hampered solar power capacity installations in India in the second quarter of 2018. Installations were at their lowest level since Q1/2017 adding only 1,599 MW during the reporting quarter, according to Mercom’s Q2 2018 India Solar Market Update.
This is a decline of 52% from 3,344 MW installed in Q1/2018. Large scale installations amounted to 1,184 MW or 74%, while rooftop solar added 415 MW or 26% of the total. India’s cumulative solar power capacity was 24.6 GW at the end of June, with rooftop adding 2.4 GW. Rooftop showed signs of growth with 6% more installed during Q2/2018, compared to the previous quarter.
In total, the first two quarters of calendar year 2018 saw 4.9 GW of installations.
Mercom Capital Group’s CEO and Co-Founder Raj Prabhu said, this decline was expected after four consecutive quarters of growth. One of the reasons was also painfully slow auction process. Out of nearly 11.5 GW tendered in the second quarter of the year, around 4.3 GW was actually auctioned. The large-scale solar power project pipeline under-construction was 11.2 GW end of June 2018, with 18.6 GW tendered and pending auctions.
Chinese module ASPs fell some 5% QoQ to $0.33 per W between April 2018 and June 2018, dropping from $0.346 per W in the first quarter of the year. Indian module prices declined by about 9% over the same period.
Project costs too saw a decline as large-scale project costs went below INR 40 million ($572,473) per MW for the first time. “As higher efficiency mono PERC modules gain traction, the land requirement has also reduced adding to cost savings. Rooftop project costs declined QoQ also due to cheaper modules and balance of systems (BoS),” according to the report.
India’s project pipeline has gotten smaller in 2018, mainly for large scale projects. Commissioning of more than 1 GW of utility scale projects will be shifted from 2019 to 2020, as MNRE’s new guidelines allow for 24 months to commission a project of 250 MW and above. Lack of auctions is also going to play its role here.
“Due to uncertainty around the safeguard duty, auction activity in the first half of 2018 was weak, which will result in a smaller large-scale project pipeline for 2019. The market is expected to freeze for 3-6 months following the safeguard duty announcement,” said Prabhu.
Mercom now expects around 8.3 GW of new PV additions in calendar year 2018, compared to 9.6 GW in 2017.
The complete report can be purchased at the website of Mercom India Research.
Another market intelligence consultancy, Bridge to India expects 6 GW of new installations in 2018 (see India To Install Only 6 GW Of PV In 2018).