19 GW bids submitted for manufacturing of polysilicon, 32 GW for wafer and 54.8 GW for cells and modules under the PLI scheme

The Government of India’s production-linked incentive (PLI) scheme – National Programme on High Efficiency Solar PV (Photovoltaic) Modules – for setting up of solar manufacturing units received an overwhelming response of 54.8 GW worth of bids for a scheme with total bid capacity of 10 GW. The bid submission which resulted over 4-fold over-subscription is a morale boost for the Indian solar industry.

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Solar installation in India is primarily dependent upon imported solar PV cells and modules. The domestic solar manufacturing capacity comprises of around 3-4 GW for solar cells and about 15 GW for solar modules.

The financial outlay for PLI for ‘High Efficiency Solar PV Modules’ over a five-year period is Rs. 4,500 crores. The scheme was officially cleared by the Cabinet in April 2021.

Along with the addition of 10 GW capacity of integrated solar PV manufacturing plants, the scheme is expected to attract the following benefits:

  • Direct investment of around Rs. 17,200 crores in solar PV manufacturing projects
  • Demand of Rs. 17,500 crores over 5 years for ‘Balance of Materials’
  • Direct employment of about 30,000 and Indirect employment of about 1,20,000 persons
  • Import substitution of around Rs. 17,500 crores every year
  • Impetus to R&D to achieve higher efficiency in solar PV modules

Subsequently, on 25th May 2021, the Indian Renewable Energy Development Agency (IREDA), a PSU under the Ministry of New & Renewable Energy (MNRE) invited bids under the PLI scheme for integrated solar manufacturing units. The PLI will be disbursed annually for a period of five years to the successful applicants.

On 21 September 2021, a list of 18 companies who have bid under the solar manufacturing PLI scheme was publically released.

Reliance New Energy, Adani Infrastructure, Jindal India Solar, Shirdi Sai Electricals and First Solar India have bid for (stage 1 to 4) manufacturing of polysilicon, ingots-wafers, cells and modules. Coal India, Larsen and Turbo, ReNew Power and CubicPV have bid for (stage 2 to 4) manufacturing of ingots-wafers, cells and modules. Tata Power Solar, Waaree Energies, Vikram Solar, Avaada Energy, Acme Solar, Premier Energies, Megha Engineering, Jupiter Solar and Emmvee PV have bid for (stage 3 to 4) manufacturing of cells and modules.

Table 1: Stages of Solar PV Manufacturing

Manufacturing StageInputFinal Product
1M.G. SilicaPolysilicon
2Stage-1 PolysiliconIngot-Wafer
3Stage-2 Ingot-WaferCell
4Stage-3 CellModule

Source: IREDA

The bidders were shortlisted after consideration of certain parameters and subsequently, they were assigned marks as per a selection criteria[1].

The bidder getting higher total marks[2] will get preference in the allocation of manufacturing capacity under the PLI scheme. In case of equal marks, the bidder quoting least total PLI amount for five years’ period, followed by a higher ‘Extent of integration’ which is followed by higher ‘Manufacturing Capacity’ will get priority in selection.

As can be seen from the figure below, Reliance New Energy, Adani Infrastructure, Jindal India Solar and Shirdi Sai Electricals have scored maximum (100) marks, with each applicant having bid for 4 GW capacity. On an aggregate basis, 19 GW of bids were submitted for manufacturing of polysilicon, 32 GW for wafer and 54.8 GW for cells and modules. 9 out of the 18 bidders are new entrants (no prior solar manufacturing experience). First Solar and CubicPV are the only two international applicants for this PLI scheme.

Fig. 1: Bid Capacities and Total Marks Assigned under Solar Manufacturing PLI Scheme

Source: IREDA, JMK Research

Though the selection process would lead to only 3 or 4 PLI beneficiaries, it is expected that the remaining applicants would still be going ahead with their plans of setting up solar PV manufacturing units. Given the aggressive plans to invest in clean energy sectors, with Reliance committing to $10 billion investments and Adani $20 billion, it is highly likely that these two biggest business houses of India will be the main PLI beneficiaries.

[1] Para 3.2, 3.3 (a) – Annexure A of IREDA Bid Document

[2] Total Marks – The sum of marks assigned under the two parameters – Extent of Integration and Manufacturing Capacity. The maximum marks that can be assigned under each parameter is 50. Thus, the maximum total marks is 100.