Market research firm, NPD Solarbuzz reports that a significant amount of crystalline-silicon solar cell production in India lays idle, despite almost US$0.5 billion of investment in solar cell equipment between 2006 and 2012.
The reason for the idled capacity was said to be down to “limited expertise in running cell capacity”, while the domestic Indian market is catered for by a host of leading PV manufacturers from the US and China.
The market research firm highlighted that US$470 million had been invested in new cell lines between 2006 and 2012 in India, though even if all lines were running at full-capacity hey could barely support 10% of the Indian market over the next 12 months.
Indian manufacturers therefore lack both expertise and scale to effectively compete.
The shocking situation is in contrast with claims from some of India’s nascent PV manufacturers that foreign firms are to blame for the sectors slow development, mainly due to pricing, which have led to Indian Government investigations into the situation.
Finlay Colville, vice-president at NPD Solarbuzz said, “The prospects for Indian c-Si [cell] manufacturers remain bleak, with many of the existing producers lacking cash to restart operations. Although trade investigations by the Indian government against imported PV products are ongoing, the lack of high-volume and low-cost fab expertize forms the key barrier to local solar cell makers. As a result, continued growth of solar deployed within India has become dependent on low-cost foreign supply.”
That low-cost foreign supply has been dominated by CdTe thin-film and PVEP leader, First Solar, which according to NPD Solarbuzz has a 15% market share during the trailing twelve months to the end of the second quarter, 2013.
Chinese PV module manufacturers, Canadian Solar, JinkoSolar, Renesola, Trina Solar and Yingli Green were said to occupy the next five ranking positions for module supply, with a combined 46% market share in India.
In recent quarterly conference calls several of the above China-based suppliers highlighted the Indian market was expected to remain strong through 2013 with some expected to supply increasing quantities of modules in the future.
However, several Indian module manufacturers that have also focused on the domestic downstream market, across off-grid, residential, commercial and utility-scale sectors, such as Tata Power Solar are said to be running at full-capacity and looking to expand capacity and market products overseas.
The idled solar cell equipment reinforces the challenges for equipment suppliers hoping to eventually capitalise on the next capacity expansion phase as PV demand continues to grow, closing the gap on excess ‘effective capacity.’