India’s Solar Installations Jump 335% to 7.4 GW in 9M 2021
POWER & RENEWABLE ENERGY

India’s Solar Installations Jump 335% to 7.4 GW in 9M 2021

India added 2,835 MW of solar in the third quarter of the calendar year 2021, up 14% compared to 2,488 MW installed in the second quarter 2021. Year over year installations in the third quarter surged 547%, according to Mercom India Research’s newly released third quarter 2021 India Solar Market Update.

In the first nine months of 2021, India added over 7.4 GW of solar, a 335% increase YoY compared to the 1.73 GW installed in the same period in 2020.


Installations grew despite market challenges, according to the report. Increased raw materials costs, severe volatility in module availability and price, curtailment of power in several states, and high freight charges have all added to the difficulties for the developers.

“Despite supply challenges, the Indian solar market is headed towards one of best years on record, and a complete turnaround from 2021, which was one of the worst years for solar due to COVID-19,” said Raj Prabhu, CEO of Mercom Capital Group. “We expect a strong 2022 despite the high price of components and uncertainties surrounding the Great Indian Bustard (GIB) related transmission issue in Rajasthan. An increase in GST, curtailment and payment issues are adding to the challenges facing developers and constraining growth.”

Detailed demand forecast by year is available in the report.

There was a steep rise in the average selling prices of solar modules during the third quarter. Prices of mono PERC modules surged over 15% Quarter over Quarter, with supply constraints after major manufacturers started cutting output in China. Freight charges peaked at around $9,000 per container in the quarter.

“Manufacturing capacity ramp-up continues at a brisk pace as domestic producers look to take advantage of the 40% basic customs duty scheduled to be imposed from April 2022. In the second quarter of next year, we can expect to see procurement strategies starting to change drastically as imports become expensive,” added Prabhu.

According to the report, module prices have now been increasing for six consecutive quarters, a trend not seen in the past ten years.

This quarter also saw the largest Quarter over Quarter increase in large-scale system costs by over 10% attributed to the increase in raw material and component prices.

Rajasthan is now the top solar state in India in terms of cumulative installed capacity, overtaking Karnataka, which had held the position since 2018 according to data from the report. As of September, the top 10 states accounted for about 96% of the country's cumulative large-scale solar installations.

Rajasthan has been the top solar installer for three consecutive quarters by contributing about 63% of the total large-scale solar installations in the country this quarter, followed by Gujarat with 19%.


According to the report, India added close to 11.6 GW of power capacity in 9 months of 2021. Solar dominated capacity additions accounting for close to 60%, followed by thermal power, which contributed 21%. Renewables (including large hydro) made up 79% of total power capacity additions in 2021.

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India added 2,835 MW of solar in the third quarter of the calendar year 2021, up 14% compared to 2,488 MW installed in the second quarter 2021. Year over year installations in the third quarter surged 547%, according to Mercom India Research’s newly released third quarter 2021 India Solar Market Update. In the first nine months of 2021, India added over 7.4 GW of solar, a 335% increase YoY compared to the 1.73 GW installed in the same period in 2020. Installations grew despite market challenges, according to the report. Increased raw materials costs, severe volatility in module availability and price, curtailment of power in several states, and high freight charges have all added to the difficulties for the developers. “Despite supply challenges, the Indian solar market is headed towards one of best years on record, and a complete turnaround from 2021, which was one of the worst years for solar due to COVID-19,” said Raj Prabhu, CEO of Mercom Capital Group. “We expect a strong 2022 despite the high price of components and uncertainties surrounding the Great Indian Bustard (GIB) related transmission issue in Rajasthan. An increase in GST, curtailment and payment issues are adding to the challenges facing developers and constraining growth.” Detailed demand forecast by year is available in the report. There was a steep rise in the average selling prices of solar modules during the third quarter. Prices of mono PERC modules surged over 15% Quarter over Quarter, with supply constraints after major manufacturers started cutting output in China. Freight charges peaked at around $9,000 per container in the quarter. “Manufacturing capacity ramp-up continues at a brisk pace as domestic producers look to take advantage of the 40% basic customs duty scheduled to be imposed from April 2022. In the second quarter of next year, we can expect to see procurement strategies starting to change drastically as imports become expensive,” added Prabhu. According to the report, module prices have now been increasing for six consecutive quarters, a trend not seen in the past ten years. This quarter also saw the largest Quarter over Quarter increase in large-scale system costs by over 10% attributed to the increase in raw material and component prices. Rajasthan is now the top solar state in India in terms of cumulative installed capacity, overtaking Karnataka, which had held the position since 2018 according to data from the report. As of September, the top 10 states accounted for about 96% of the country's cumulative large-scale solar installations. Rajasthan has been the top solar installer for three consecutive quarters by contributing about 63% of the total large-scale solar installations in the country this quarter, followed by Gujarat with 19%. According to the report, India added close to 11.6 GW of power capacity in 9 months of 2021. Solar dominated capacity additions accounting for close to 60%, followed by thermal power, which contributed 21%. Renewables (including large hydro) made up 79% of total power capacity additions in 2021.Image Source

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