The Ministry of New and Renewable Energy (MNRE) says India will aim to install 10 GW of integrated solar PV manufacturing capacity by Q4/2022-2023 comprising the entire chain from wafer-ingot to high efficiency modules. This is expected to entail direct investment of INR 140 billion ($1.93 billion).
This is targeted to be achieved under its production linked incentive (PLI) scheme that was unveiled in the national budget for FY 2021-22 with High Efficiency Solar PV Modules as one of the 13 sectors where the government wants to create ‘manufacturing global champions for an Atmanirbhar Bharat’ or a self-reliant India. In the budget, Finance Minister Nirmala Sitharaman said the government plans to come out with a phased manufacturing plan solar cells and panels to build up domestic capacity (see Solar Power Figures Big In Indian Budget 2021-22).
MNRE said the government has committed nearly INR 1.97 lakh crore to be invested over the next 5 years. Beginning FY 2021-22, it will comprise INR 45 billion ($620 million) for High Efficiency Solar PV Modules to be implemented by the ministry.
“It will help bring scale and size in solar PV manufacturing, create and nurture global champions and provide jobs to youth. The PLI schemes will incentivize new Gigawatt (GW) scale solar PV manufacturing facilities in India,” explained MNRE. “The EFC meeting for formulating a scheme in this regard has already been held. It will now be taken to the Cabinet for final approval. The scheme will reward efficiency of solar modules as well as local value addition.”
The Solar Energy Corporation of India (SECI) will be able to float tenders for 15 GW of renewable energy capacity annually with the help of INR 10 billion it secured as capital infusion under the budget. It will also set up innovative projects worth INR 170 billion ($2.34 billion). Also, on an annual basis, it is expected to attract investment of over INR 600 billion ($8.27 billion) while leading to creating 45,000 jobs.
Till the end of December 2020, India’s cumulative installed renewable energy capacity was 91 GW with another 50 GW under implementation of which SECI’s share is 54%, shared the ministry.
Another beneficiary, the Indian Renewable Energy Development Agency (IREDA) with INR 15 billion capital infusion, will be able to extend an additional loan facility of INR 120 billion ($1.65 billion) in addition to its existing book size of INR 270 billion ($3.72 billion). This will lower the interest rate for developers since it will enable the agency to borrow at a lower rate of interest.
MNRE explained that the infusion will lead to an IREDA financing around 4.5 GW of renewable energy projects worth INR 180 billion to INR 190 billion ($2.48 billion to $2.62 billion).
National Hydrogen Energy Mission
Elaborating on another program proposed in the budget, the National Hydrogen Energy Mission, the ministry confirmed the mission would put forward specific strategy for 4 years in the short term, and broad strokes principles for 10 years and beyond in the long term with an aim to develop India into a global hub for manufacturing of hydrogen and fuel cells technologies across the value chain. Green hydrogen can then be utilized by energy intensive sectors as fertilizer, steel, petrochemicals among others with the Indian government facilitating demand creation in identified segments.
India’s government will develop a framework to support manufacturing through suitable incentives and facilitation aligned with Make in India and Atmanirbhar Bharat programs.
MNRE said the draft mission document is expected to be finalized in February 2021 and will be put up for inter-ministerial consultation and cabinet approval process.