IREDA Opens PLI Bids. Solar Manufacturing Likely To Get Some New Names

The Solar PLI manufacturing bids have finally been opened by the Indian Renewable Energy Development Agency (IREDA). And the results are really interesting. Not only have relatively new players bid more aggressively making it tougher for incumbents to qualify, but it also sets the stage for a really interesting domestic market. The Solar PLI scheme has a budget of Rs 4500 crores as incentives for setting up manufacturing capacities for a minimum of 10 GW of vertically-integrated high-efficiency solar modules under the program.

Finally, 16 bidders with a cumulative bid capacity of close to 53 GW qualified, with almost 19000 MW bid for all four manufacturing stages as specified in the bid document. The four stages are polysilicon, wafers, cells and modules.  Among these, Jindal India Solar Energy, with a PLI requirement of just Rs 1390 crores is the frontrunner. The highest requirement here came from Adani Infrastructure at Rs 3600 crores, while Reliance New Energy Solar penciled in a Rs 1917 crore support request.

Under Stage 2 to 4, Coal India has emerged as the bidder, with a PLI request for Rs 1340 crores. That gives the only PSU in the fray, also the largest coal miner in the world, a very good chance of starting its journey to change tracks towards renewable energy in a big way. Similarly, under Stage 3 to 4 comprising cells and modules manufactiring, Hyderabad-based Megha Engineering and Infrastructures has quoted the lowest PLI of Rs 333 crores. Megha Engineering has emerged as a huge infra player in the past decade, especially after its work on the  Kaleshwaram Lift Irrigation Project, the largest of its kind in the world, on the Godavari River.

The bid document specifies that the manufacturing capacity and PLI would be allocated to the eligible applicants as per the bucket filling mechanism keeping in view the overall PLI limit of Rs 4500 crores

IREDA, as the implementing agency, will retain 1% of the amounts disbursed to the successful bidders.

While the PLI scheme has been a strong success, solar manufacturing in India has moved on irrespective of the scheme, with a lot of fresh capacity having come up, and more being planned beyond the scheme. With its high tilt towards large volume players, many smaller and medium sized firms have chosen to focus on getting state level incentives in any case. The only issue on which all players are likely to be united is for the government to stay with its promise to impose customs duties from the next Financial year, an issue that is still mired in some doubt now, due to the impact of rising costs on developers.