NEW DELHI: Adani Green Energy Ltd, the renewable energy arm of the Adani Group, is considering a technical partnership with global major SunEdison Inc for its $2 billion foray into integrated solar manufacturing.
The collaboration is being considered despite SunEdison’s recent troubles, which saw the renewable energy heavyweight file for protection from its creditors in the US in late April. “We are also looking at two other companies, Golden Concord Holdings ( GCL ) and OCI Solar Power . We are yet to take a decision,” said Jayant Parimal, CEO, Adani Green Energy.
GCL, headquartered in Hong Kong, is the biggest manufacturer of solar photovoltaic material, while Texas-based OCI has over 500 MW of installed solar power worldwide.
“We are currently evaluating the technologies offered by these manufacturers cum technology providers,” said Parimal. “Once we zero in on one of them, we may bring the company in as a JV partner.”
Adani Green Energy integrated solar manufacturing plant will be the first of its kind in the country. It has created a special purpose vehicle, Mundra Solar PV Ltd, to handle the project.
Solar manufacturing consists of four main phases: making polysilicon crystals, slicing them into wafers, using the wafers to make solar cells, and using the cells to make solar modules which generate power. India currently has 14 manufacturers of solar cells producing 1212 MW of cells annually and 81 makers of solar modules who produce a total of 5620 MW. There are practically no manufacturers of polysilicon or polysilicon wafers, all of which is imported.
“That is because the investment required to make polysilicon is much higher than that needed to set up a module manufacturing line,” said Parimal, and the Adani Group’s success of the project will be crucial to the future of solar manufacturing in India.
In the first phase, work on which has already begun, a solar cell and module manufacturing plant is being set up at a cost of Rs 2000 crore. With a capacity of 1200 MW, the project expected to be complete by December, will at one stroke double the country’s cell manufacturing capacity.
In the second phase, it will expand capacity to 2000 MW and start making silicon wafers. It is in the third phase that polysilicon manufacturing will begin. “But to do so, we expect an offtake guarantee from the government,” said Parimal. “Polysilicon is a highly competitive market globally and needs the support of the government to take off in India. We are keenly watching the government’s policies in this regard.”
For the third phase, a technical tie up will be necessary. “We are not doing any JV at this juncture, but in the third phase, we may bring in a JV partner,” said Parimal.
Given India’s ambitious solar programme of creating 100,000 MW of installed solar power by 2022, its manufacturing capacity is grossly inadequate. The programme is heavily dependent on imports – around 95 per cent of the solar cells and modules used by solar developers in India are imported. Since domestic cell and module manufacturers also import much of their basic material – mostly from China and Malaysia – local cells and modules also cost 8-10% more than the ones from these countries.
The government has tried to encourage local manufacturing by including a ‘domestic content requirement’ (DCR) component in its Jawaharlal Nehru National Solar Mission, but the WTO has upheld a complaint from the US that India’s DCR amounts to favouring local manufacturers over global ones. The Ministry of New and Renewable Energy is currently working with Niti Aayog to formulate a new solar manufacturing policy which is expected to provide more incentives to manufacturers.
Three MoUs between Indian and Chinese companies for joint ventures to manufacture solar cells and modules in India were signed during Prime Minister Narendra Modi’s visit to China in May 2015, but none of them have made much headway so far.
Source: Economic Times