New round of solar PLI to have 3 schemes for different product categories

Plans to include highest corpus to polysilicon manufacturing

The new round of the production-linked incentive (PLI) programme for solar manufacturing will have three schemes for different product categories. The total corpus allocated to the second tranche of the PLI scheme is Rs 19,500 crore and of that the highest share of Rs 12,000 crore will go to end-to-end manufacturing of “polysilicon-wafers-cells-modules” (raw material to finished product).

For “wafer-cells-modules”, the government will allocate Rs 4,500 crore and for “cells-modules” manufacturing, Rs 3,500 crore has been allocated. “The scheme may be viewed as three separate standalone schemes. In case a particular category is undersubscribed, the remaining funds will move to the other categories,” said the draft proposal of the Ministry of New and Renewable Energy.

The draft has suggested 10 Gw cap on bid capacity for polysilicon-module category and 6 Gw on the other two. A bidder will need to submit their extent of manufacturing integration, proposed manufacturing capacity, year-wise local value addition and year-wise efficiency of their products. The draft was circulated with the industry to provide their comments. Most of the industry majors have contes­ted the large corpus going to ‘polysilicon to module’ category, stating that no domestic player in India has a facility for this.

“Globally also, there are only a handful of manufacturers who have polysilicon manufacturing, along with solar modules. Poly­silicon is also used in the semiconductor industry and is a standalone industry,” said an industry submission.

In India, no company manufactures polysilicon — raw material for the whole supply chain of solar equipment manufacturing. Reliance Industries Limited (RIL) is reportedly in talks with China-based Hualu Engineering for a polysilicon manufacturing partnership.

RIL’s newly formed arm Reliance New Energy Solar (RNESL) was one of the companies that won the first solar manufacturing tender offered under the PLI scheme. It also recently announced investment in German solar wafer firm NexWafe.

In the cells and modules segment Adani Solar, Vikram Solar, Waaree Energies are key players. The domestic industry further said most leading players globally and in India are in the ‘cells and modules’ category and it deserves a higher corpus. The industry further said, as there will be more players in the ‘cells-modules’ category, there will be more competition.

The nodal agency for the second tranche of bidding has also been changed to Solar Energy Corporation of India (SECI) from Indian Renewable Energy Development Agency (IREDA) earlier.

In the first tranche of tendering, MNRE received close to 50 Gw of bids against a PLI sanction of Rs 4,500 crore and RfP of 10 Gw. It received close to 18 bids from a range of companies — Coal India, L&T, Vikram Solar, Megha Engin­eering and several new companies. Apart from RNESL, the winners were Adani Infrastructure and Shirdi Sai.

The corpus was increased to Rs 19,500 crore under the Union Budget 2022-23 to accommodate the large number of bids.