Guidelines Issued for PLI Scheme for Solar Modules; IREDA to be Implementing Agency

MNRE has issued the guidelines for the implementation of the PLI scheme for high-efficiency solar PV modules.

The Ministry of New and Renewable Energy (MNRE) in a ministry wide notification has announced the sanction of the President for implementation of the Production Linked Incentive (PLI) scheme ‘National Programme on High-Efficiency Solar PV Modules’ for achieving manufacturing capacity of Gigawatt (GW) scale in high-efficiency solar PV modules. With the sanction, the Ministry has also issued the Guidelines for the implementation of the scheme.

Background: 

On November 11, 2020, the Cabinet had approved the introduction of the PLI Scheme for 10 key sectors, for enhancing India’s manufacturing capabilities and exports under Atmanirbhar Bharat initiative. One of the 10 sectors for which the introduction of PLI had been approved by the Cabinet was ‘High-Efficiency Solar PV Modules’ for which MNRE had been designated as the implementing Ministry. The financial outlay for PLI for ‘High-Efficiency Solar PV Modules’, as approved by the Cabinet over a five-year period is Rs 4,500 crore. In April 2021, the union cabinet chaired by Narendra Modi had officially approved the scheme for the solar modules.

As per the ministry, solar capacity additions presently depends largely upon imported solar PV cells and modules as the domestic manufacturing industry has limited operational annual capacities of around 2,500 MW for solar PV cells and 9,000-10,000 MW for solar PV modules. 

Thus, the aim of the scheme is to promote the manufacturing of high-efficiency solar PV modules in India and thus reduce import dependence in the area of Renewable Energy. 

The key objectives include: 

• To build up solar PV manufacturing capacity of high-efficiency modules.
• To bring cutting-edge technology to India for manufacturing high-efficiency modules. The scheme will be technology agnostic in that it will allow all technologies. However, technologies that will result in better module performance will be incentivised.
• To promote setting up of integrated plants for better quality control and competitiveness.
• To develop an ecosystem for sourcing of local material in solar manufacturing.
• Employment generation and technological self-sufficiency.

Implementing Agency:

The PLI scheme will be implemented by MNRE through Indian Renewable Energy Development Agency (IREDA) as Implementing Agency. IREDA will be responsible for providing secretarial, managerial and implementation support and carrying out other responsibilities as assigned by MNRE from time to time.

The responsibilities of IREDA inter alia, include receipt of applications, examination and appraisal of applications as per the modalities of this scheme, issuing acknowledgments to applicants, making appropriate recommendations to MNRE after assigning inter-se ranking for approval of beneficiaries, examination of claims of beneficiaries for disbursement of PLI, verification and reconciliation of disbursement claims with prescribed documents and making appropriate recommendations to MNRE in this regard, compilation of data regarding progress and performance of the scheme through Quarterly Review Reports and other information / documents. 

IREDA will have the right to carry physical inspection of an applicant’s manufacturing units and offices through site visits. It will take the help of the National Institute of Solar Energy (NISE) for measurement of efficiency and temperature co-efficient of modules. If required, MNRE may also designate National Accreditation Board for Testing and Calibration Laboratories (NABL) accredited labs, etc. for such measurement.

Selection of beneficiaries: 

As per the guidelines, the beneficiaries of the PLI scheme will be selected through a transparent bidding process. 

Applications will be shortlisted after consideration of the following parameters:

1. Extent of Integration: Preference will be given to manufacturers who propose to set up a fully integrated solar PV manufacturing plant using silicon based technology (starting from the stage of manufacturing of polysilicon, to Ingot/Wafer to Solar Cell and Module) or fully integrated Thin Film technology or any other technology. However, in order to qualify for the bid, the applicant manufacturer will have to promise minimum integration across solar cells and modules. 
2. Manufacturing Capacity: Preference will be given to manufacturers who set up higher capacity plants. However, in order to qualify for the bid, the applicant manufacturer will have to undertake to set up a manufacturing plant of minimum 1,000 MW capacity (1,000 MW each for all individual stages included in the manufacturer’s proposal).
3. Minimum module performance: Manufacturers will also have to fulfill following minimum performance parameters: 

• • Minimum module efficiency of 19.50 percent with temperature coefficient of Pmax better than -0.30 percent per degree Celsius Or 
  • Minimum module efficiency of 20 percent with temperature coefficient of Pmax equal to or better than – 0.40% per degree Celsius

Bidders that fulfill the minimum conditions as specified above will be shortlisted. Subsequently, they will be assigned marks, for determining their inter-se position as per the following selection criteria table:

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

As per the guidelines, the manufacturer can bid any capacity (MW), the maximum capacity that can be awarded, to one bidder under the PLI scheme, is 50 percent of the bid capacity (capacity which he has promised to set up in his bid) or 2000 MW, whichever is less, to accommodate at least three manufacturers under the overall envelope of Rs 4,500 crore.

Commenting on the latest guidelines for the production-linked incentive (PLI) scheme, Gyanesh Chaudhary, MD, Vikram Solar said “Vikram Solar welcomes the MNRE’s latest guidelines for the production-linked incentive (PLI) scheme, which is a great and decisive step towards making India “Aatmanirbhar”. As a domestic solar manufacturer, we have high hopes from the PLI scheme as it promises to promote solar manufacturing in the country. This would solve the energy crisis, create jobs, increase investment, and bring technological innovation to the sector. It would also help India to achieve the Renewable Energy target set at the Paris Agreement well within the timeline.

The PLI scheme for Solar Sector has an allotment of Rs 4,500 crore and beneficiaries would be selected through a transparent bidding process. Under this scheme, manufacturers will be rewarded for higher efficiencies of solar PV modules and also for sourcing their material from the domestic market. This will attract more investment for the Indian solar industry and I hope the government will provide the second tranche of PLI for solar manufacturers. Thus creating a need to develop a complete ecosystem for the solar sector in India. The announcement of providing PLI will jump-start the next phase of the Indian manufacturing story for good!”

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[Updated May 3, 2021]