India changes PLI rules and opens up new rounds to previous winners, bids capped at 10GW

Facebook
Twitter
LinkedIn
Reddit
Email
The PLI was designed to support the growth of high efficiency module manufacturing in India. Image: Trina Solar

India’s expanded Production Linked Incentive (PLI) scheme has changed its rules and future rounds will now be open to previous winners, although total capacities will be capped at 10GW. The local content requirement for manufacturer of 90% remains.

At the start of last month, the Indian government quadrupled the amount of funding for its PLI scheme by making a further Rs19,500 crore (US$2.6 billion) available.

This article requires Premium SubscriptionBasic (FREE) Subscription

Unlock unlimited access for 12 whole months of distinctive global analysis

Photovoltaics International is now included.

  • Regular insight and analysis of the industry’s biggest developments
  • In-depth interviews with the industry’s leading figures
  • Unlimited digital access to the PV Tech Power journal catalogue
  • Unlimited digital access to the Photovoltaics International journal catalogue
  • Access to more than 1,000 technical papers
  • Discounts on Solar Media’s portfolio of events, in-person and virtual

Or continue reading this article for free

The PLI scheme was implemented in April last year by the Ministry of New and Renewable Energy and aimed to incentivise companies setting up integrated, higher capacity, high efficiency solar module plants in India.

Back then, a Request for Proposals (RfP) for 10GW of high efficiency solar module and cell manufacturing capacity received 54.8GW of bids from 18 different companies. Bids were capped at 4GW.

The winners were Reliance New Energy Solar, Adani Infrastructure and Shirdi Sai. Runners up were told they would be included in the next round or chosen automatically if more funding was made available, with the winners of the initial round unable to take part.

Now, it has been reported that those original winners will be allowed to participate in the next, expanded round of PLI bids. Their bid, however, will be capped at 10GW, inclusive of capacity awarded during the first round.

Indian officials are expecting stiff competition and more aggressive bids for the upcoming round, according to Business Standard. It quoted an Indian official as saying: “As the government received an excited response in the first round, it is expected that competition will be tight in this round too.”

Jyoti Gulia, founder of JMK Research and Analytics, said the extra funding and rules change was because the Indian central government wanted to give opportunities to a larger set of players who are exploring market entry or whether to scale up in the sector.

“Multiple players lead to competition and less monopoly and hence competitive market driven module prices,” she said.

Vinay Rustagi, managing director of research firm Bridge to India (BTI), however, said the new rules “run counter to the original scheme” in that expanding the capacity the original winners can bid for means less competition, even if it is desirable from a scale and cost perspective.

“It now appears that top 3-4 bidders may garner the entire US$3.2 billion PLI budget, which would be highly controversial,” said Rustagi, adding that it could potentially lead to legal disputes due to the change from the original scheme.

Extra PLI funding was announced as part of India’s recent budget, which was described as a “game-changer” for solar manufacturing in the country.

The scheme is expected to add up to 40GW of additional cell and module manufacturing capacity in the country, according to Indian rating agency ICRA, a Moody’s Investors Service company.

21 March 2024
4pm (GMT)
This special webinar will look at one of the most important changes impacting PV manufacturing today; how to establish and sustain new facilities around the world. For more than two decades, policy-makers have grappled with the challenges of nurturing domestic manufacturing sectors. Many countries have tried to create domestic sectors: Japan, Taiwan, South Korea, India, Europe and the U.S. But success stories have been rare. Mistakes seem to be repeated. And all the while, Chinese dominance of the industry has only increased. However, in the past 2-3 years, new drivers have emerged that suggest the dream of a global PV manufacturing ecosystem could be a reality. Join us as we shed light on this.
21 May 2024
Napa, USA
PV Tech has been running PV ModuleTech Conferences since 2017. PV ModuleTech USA, on 21-22 May 2024, will be our third PV ModulelTech conference dedicated to the U.S. utility scale solar sector. The event will gather the key stakeholders from solar developers, solar asset owners and investors, PV manufacturing, policy-making and and all interested downstream channels and third-party entities. The goal is simple: to map out the PV module supply channels to the U.S. out to 2025 and beyond.

Read Next

Subscribe to Newsletter

Upcoming Events

Solar Media Events
March 12, 2024
Frankfurt, Germany
Upcoming Webinars
March 13, 2024
9am EDT / 1pm GMT / 2pm CET
Solar Media Events
March 19, 2024
Texas, USA