Indian solar bidding ‘irrationally aggressive’ say majority of CEOs

Facebook
Twitter
LinkedIn
Reddit
Email

Bidding in the Indian solar industry has been deemed irrationally aggressive by 70% of CEOs responding to a survey from consultancy firm Bridge to India, however, sentiment remains upbeat about growth prospects and the overall industry.

The ‘India RE CEO Survey 2018’ tapped opinions from 44 domestic and international companies. On average, these company heads expect India to reach 66GW of installed solar capacity by March 2022, well short of the original 100GW target set under the National Solar Mission (NSM). Just 7% of respondents believe the 100GW target will be surpassed on time.

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

They also forecast rooftop PV to reach only 10GW by 2022 (the original 40GW target has been reduced), and for wind capacity to reach 52GW, just short of the 60GW target.

As expected the key concerns included the looming threat of safeguard duty imposition, for which a 70% duty has been recommended and a final decision is pending. This nuisance for the downstream PV sector is compounded by the fact that 77% of CEOs are also unenthusiastic about the progress of domestic manufacturing – which the Safeguard Duty aims to protect – believing that total manufacturing capacity will be less than 3GW by 2022.

Other major anxieties related to uncertainty at the policy level and the ailing finances of the distribution companies (Discoms).

Bridge to India has made known its belief that bidding levels have been too aggressive for some time. It said that tariffs ought to be raised given the increasing number of tender issuances, but it remains to be seen if Discoms will be willing to accept higher prices. Just 3% of the CEOs surveyed said the bidding levels have been balanced.

The latest auctions saw L1 tariffs in the range of INR2.71-2.73 (US$0.04) in Andhra Pradesh and Maharashtra.

The most attractive states were as follows:

Credit: Bridge to India

Most respondents felt that India will add about 6-10 GW of open access power by March 2022.

Vinay Rustagi, managing director, Bridge to India, said: “The Indian RE market, currently about 10GW per annum, is rapidly acquiring scale and maturity. The latest edition of [the] ‘India RE CEO Survey’ highlights that notwithstanding some major policy issues including safeguard duties and [the] poor financial condition of Discoms, the industry remains optimistic about future growth prospects. An aggressive bidding environment and [the] possible imposition of safeguard duty are major worries for the sector.”

Energy storage has yet to “find acceptance” in India, said the consultancy, with lack of techno-commercial understanding, lack of enabling policy environment and high cost all being cited as key challenges.

Read Next

July 22, 2024
Indian power company JSW Energy's renewables generation has increased by over 40% for Q1 FY2025, but solar's generation dropped by 2.7%.
July 19, 2024
Sungrow has signed an agreement with Hero Group's renewables arm Hero Future Energies to supply 850MW of inverters.
July 18, 2024
The financing will be offered to two banks, as they will provide loans to developers and end-users to install rooftop solar systems.
July 18, 2024
Winning bids as low as INR3.41/kWh have been registered in a tender for solar PV paired with battery storage hosted by the SECI.
July 16, 2024
North America is expected to be the major market for solar trackers in the upcoming years driven by increased installations in the US.
July 15, 2024
Indosolar, a solar manufacturer and subsidiary of Indian company Waaree Energies, has started operations at a 1.3GW module assembly plant in India.

Subscribe to Newsletter

Upcoming Events

Upcoming Webinars
July 31, 2024
1:00 PM (BST) / 2:00PM (CEST)
Solar Media Events
September 24, 2024
Warsaw, Poland
Solar Media Events
September 24, 2024
Singapore, Asia
Solar Media Events
October 8, 2024
San Francisco Bay Area, USA