Second tranche of solar PLI puts premium on efficiency

04 Oct 2022 CW Team

The selection criteria under the Rs 195 billion second tranche of production-linked incentives (PLI) for solar manufacturing puts a premium on efficiency levels of the modules, unlike in first tranche, according to norms notified by the Ministry of New and Renewable Energy (MNRE).

The selection criteria under the first tranche had separate marks for capacity and integration levels, while value-addition and capacity were being used as secondary criteria to address any possible tie among competing firms.

“The focus on efficiency and local value addition in tranche II of the scheme is an indicator that the government’s goal is not restricted to promoting manufacturing in India, but has been enhanced to providing high-efficiency solar PV modules and ensuring development of overall supply chain for manufacturing here,” an expert said.

A separate budget has been allocated for each level of integration — such as polysilicon to module, ingots to module and cell to module —to ensure that mid to large players in the industry would get a fair chance to participate in the revised scheme, unlike the previous scheme.

“However, the incentive amount has been substantially reduced compared to the previous scheme. So bidders should also focus on incentives under the State Industrial Policy, customs concessional schemes, etc, when computing their return on investment while analysing feasibility for manufacturing solar PV modules here,” the expert said.

The cabinet had on September 21 approved the second tranche of PLI for high efficiency solar module manufacturing, a move the government said will substitute imports worth Rs 1.4 trillion a year and create 975,000 direct and indirect jobs.

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