June 6: Solar reforms in China could just turn out to be fruitful for India. With China adopting a policy that saw the cutting down of subsidies, Indian solar market is ready to make the best out of the possible price weakening in the solar panels.
China last week announced that it was putting a temporary stay over new solar project approvals in addition to cutting down the subsidies to developers. While the action was taken to ease the pace of expansion, the same is expected to bring down the prices of the photovoltaic cells, which would in turn be followed by the increase in shipment of the panel to overseas markets.
The fall in module prices is expected to be fruitful to India, as tariffs are expected to fall to new record low prices by the next solar action that’s scheduled for mid-June. The previous record was Rs2.44 per kilowatt, which was the tariff during May last year.
India’s annual cell-manufacturing capacity of 3 gigawatts falls way short off the annual demand that stands at around 20 gigawatts. Experts predict that the prices of modules imported from China would fall to at least 10 percent from the current level, which stands at $0.31 per watt.
With China’s demand weakening, module prices should come down further in the second half of 2018, and will continue into the next year as well according to analysts. This would be a shot in the arm for Prime Minister Narendra Modi’s plan to increase the renewable power capacity in the country to 175 gigawatts by 2022.