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					</table><p>Solar project developers anticipate a rise in module prices to drive up overall project costs following the recent import duties on solar glass.</p>
<p>Recently, the <a href="https://www.commerce.gov.in/" target="_blank" rel="noopener">Ministry of Commerce and Industry</a> <a href="https://www.mercomindia.com/india-slaps-anti-dumping-duties-on-solar-glass-imports-from-china-and-vietnam" target="_blank" rel="noopener">imposed</a> anti-dumping duty in the range of $658/MT to $664/MT for imports from China and $570/MT to $664/MT from Vietnam. The Ministry also imposed countervailing duties ranging from $539/MT to $664/MT.</p>
<p>Glass manufacturer Borosil Renewable initiated the investigation into the alleged dumping of solar glass from China and Vietnam into the domestic market.</p>
<p>Borosil said, &#8220;We firmly believe that while restoring fair competition and creating a level playing field for domestic manufacturers, this will encourage rapid and significant growth in domestic manufacturing of solar glass, leading to exponential growth in India&#8217;s solar glass industry.&#8221;</p>
<p>While domestic solar glass manufacturers welcomed the imposition of duties, solar developers fear project costs will increase as module prices rise.</p>
<p>Laxit Awla, CEO of <a href="https://www.sael.co/" target="_blank" rel="noopener">SAEL</a>, opined that the price hikes resulting from these duties are high enough for foreign suppliers to absorb them internally. &#8220;The cost increases are likely to be passed over to developers. Given the competitive margins, this price increase will likely result in higher bids for upcoming solar projects.&#8221;</p>
<p>Other developers like Hanish Gupta, Managing Director at <a href="https://sunkind.in/" target="_blank" rel="noopener">Sunkind Energy</a>, concurred. &#8220;As a direct result of these duties, Approved List of Models and Manufacturers (ALMM)-compliant solar module prices have increased by about ₹1,000 (~$11.46)/kW, creating added pressure on project costs.&#8221;</p>
<p>Indian consumers, including developers, would also face challenges from likely limitations in sourcing materials matching the quality and reliability of imported products. &#8220;While imposing safeguard duties supports local industries, it also creates short-term hurdles for consumers relying on affordable, high-quality imports.&#8221;</p>
<p>Gupta said there would be a supply shortage as an immediate consequence of duty imposition due to increased module costs.</p>
<p>Mercom had <a href="https://www.mercomindia.com/anti-dumping-solar-glass-module-price-increases" target="_blank" rel="noopener">estimated</a> that duty imposition could increase module prices to approximately ₹450 (~$5.30)/module of 540 Wp -550 Wp, resulting in an increase of ₹0.80 (~$0.0094)/Wp to ₹0.90 (~$0.011)/Wp. Some domestic manufacturers had also increased prices by ₹2 (~$0.024)/Wp to ₹2.5 (~$0.029)/Wp.</p>
<p>Developers foresee a substantial but gradual shift away from imported components.</p>
<p>According to Awla, the domestic manufacturing sector is still scaling up capacity. &#8220;Until Indian manufacturers fully bridge the gap in production capacity and quality standards, imports will continue to play a role in meeting the needs of developers, albeit at reduced levels due to the higher costs associated with duties. Over time, as domestic capabilities improve, reliance on imports is expected to decline further.&#8221;</p>
<p>Concerns regarding domestic manufacturers&#8217; capabilities to match the quality and reliability of imported modules remain, given their relatively recent entry into large-scale production compared to established global players.</p>
<p>Developers are worried about efficiency gaps and real-world performance compared to imported modules. In the past, developers have faced issues such as higher degradation rates and lower conversion efficiencies, which can impact project returns and profitability.</p>
<p>Awla said it is too early to comment on whether developers would invoke a &#8220;change in law&#8221; event following the imposition of duties on solar glass imports. &#8220;At this stage, it is difficult to predict whether developers would invoke &#8216;change in law&#8217; clauses due to module price changes resulting from anti-dumping duties. However, given that such regulatory changes can significantly impact project economics, developers may explore contractual provisions allowing adjustments or compensation under unforeseen regulatory shifts.&#8221;</p>
<p>Gupta said some developers might invoke change-in-law clauses to safeguard their financials, while others may absorb the additional costs depending on their contracts and project margins.</p>
<p>Solar developers caution that any further duties must be carefully calibrated according to prevailing market conditions. Awla said that considering India&#8217;s rapid growth trajectory and increasing demand for solar energy solutions, excessive or poorly timed duties could pose challenges for manufacturers and developers alike.</p>
<p>Gupta added that duties should only be considered after strengthening domestic manufacturing. Increasing duties without ensuring sufficient supply and quality control will only drive up costs, making projects less viable while imports continue to fill the gap.</p>


Solar Developers Fear Module Price Hikes After Import Duties on Solar Glass


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					</table><p>The average cost of large-scale solar projects in India dropped by almost 23% year-over-year (YoY) in the third quarter (Q3) of calendar year (CY) 2024, according to Mercom India Research&#8217;s recently released <a href="https://www.mercomindia.com/product/q3-2024-india-solar-market-update" target="_blank" rel="noopener">Q3 2024 India Solar Market Quarterly Update.</a> The costs remained flat quarter-over-quarter (QoQ).</p>
<p>By September 2024, solar module prices had declined for more than seven consecutive quarters, resulting in lower project costs.</p>
<p>In Q3 2024, solar module costs fell 3.3% QoQ, accounting for almost 47% of average large-scale solar project costs.</p>
<p><a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/12/Average-Cost-of-Large-Scale-Solar.png"><img loading="lazy" decoding="async" class="aligncenter wp-image-75140 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/12/Average-Cost-of-Large-Scale-Solar.png" alt="Average Cost of Large-Scale Solar" width="2295" height="1214" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/12/Average-Cost-of-Large-Scale-Solar.png 2295w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/12/Average-Cost-of-Large-Scale-Solar-300x159.png 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/12/Average-Cost-of-Large-Scale-Solar-2000x1058.png 2000w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/12/Average-Cost-of-Large-Scale-Solar-768x406.png 768w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/12/Average-Cost-of-Large-Scale-Solar-1536x813.png 1536w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/12/Average-Cost-of-Large-Scale-Solar-2048x1083.png 2048w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/12/Average-Cost-of-Large-Scale-Solar-650x344.png 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/12/Average-Cost-of-Large-Scale-Solar-624x330.png 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/12/Average-Cost-of-Large-Scale-Solar-600x317.png 600w" sizes="auto, (max-width: 2295px) 100vw, 2295px" /></a></p>
<p>The average selling price (ASP) of the Indian monocrystalline Passivated Emitter Rear Contact (mono PERC) modules dropped 7% QoQ and over 38% YoY due to the falling prices of imported solar cells.</p>
<p>The ASP of the Chinese mono PERC module was down by more than 13% QoQ and over 52% YoY. A significant inventory of unsold solar modules led to a further price drop in Q3.</p>
<p>Despite the reimposition of the ALMM order, a significant capacity of large-scale solar projects with the final bid submission date <a href="https://www.mercomindia.com/mnre-clarifies-applicability-for-solar-projects" target="_blank" rel="noopener">before</a> April 10, 2021, installers or developers of behind-the-meter projects and a few other projects were able to import modules in the quarter.</p>
<p>Despite the reimposition of the ALMM order, a substantial number of large-scale solar projects, whose final bid submission date was <a href="https://www.mercomindia.com/mnre-clarifies-applicability-for-solar-projects" target="_blank" rel="noopener">before</a> April 10, 2021, along with installers or developers of behind-the-meter projects, were able to import modules during the quarter.</p>
<p>India <a href="https://www.mercomindia.com/india-solar-cell-module-imports-q3-2024" target="_blank" rel="noopener">imported</a> solar cells and modules amounting to $986.5 million (~₹82.6 billion) in Q3 2024, up 27.3% QoQ from $774.9 million (~₹64.6 billion). Imports dropped 18.8% YoY from $1.2 billion (~₹101.6 billion).</p>
<p>The ASPs of Indian mono PERC modules, compliant with domestic content requirement (DCR), were over 52% higher than those of non-DCR compliant modules. The country&#8217;s limited cell production capacity, increased raw material prices, including silver and aluminum, and increased project demand have created a demand-supply gap and raised costs for domestic manufacturers of DCR-compliant modules.</p>
<p>The average module mounting structure cost was up by 5.7%, and the power conditioning unit cost rose marginally QoQ. Module mounting structures accounted for 9.2%, and the power conditioning unit comprised 6% of the project cost.</p>
<p>The cost of other balance of system (BoS) components remains stable, contributing to 1.6% of the total cost.</p>
<p>The country <a href="https://www.mercomindia.com/india-16-gw-solar-capacity-9m-2024" target="_blank" rel="noopener">added</a> 2.8 GW of large-scale solar capacity in Q3 2024, down 34% QoQ and up almost 77% YoY.</p>
<p>India&#8217;s cumulative installed solar capacity stood at 89.1 GW as of September 2024. Large-scale solar projects comprised over 86% of the installations, and rooftop solar projects made up almost 14%.</p>
<p>Mercom&#8217;s Q3 2024 India Solar Market Quarterly Update is 86 pages long and covers all facets of the Indian solar market. For the complete report, visit: <a href="https://www.mercomindia.com/product/q3-2024-india-solar-market-update" target="_blank" rel="noopener">https://www.mercomindia.com/product/q3-2024-india-solar-market-update</a></p>


Average Cost of Large-Scale Solar Projects in India Drops 23% YoY in Q3 2024

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