Indian solar policy roundup 2017

India’s Minister of State for Power and New & Renewable Energy, Raj Kumar Singh, has announced to the upper and lower assembly of the parliament, in a written reply, updated information about the country’s renewable installations for the last three years, as well as recent policies initiated, quality norms and the current status of import issues.

According to the MNRE, in the financial year of 2017-18 India has generated 12,973.6 kWh from solar. In last three financial years from 2014 -15 to 2016-17, India generated 4,599 kWh, 7,448 kWh, and 13,499 kWh of solar power respectively.

Policy initiatives in solar
The MNRE has initiated several policies over the last three years to comply with the revised target of 100 GW solar by 2022. Singh informed that the government has issued guidelines for the procurement of solar and wind power through a tariff-based competitive bidding process, and has expanded Renewable Purchase Obligation (RPO) up to the year 2018-19 while notifying standards for deployment of solar photovoltaic systems/devices.

The government has also issued an order for waiving the Interstate Transmission System charges and losses for the interstate sale of solar and wind power for projects to be commissioned by March 2019. In parallel, the government will also be launching a Atal Jyoti Yojna for solar LED streetlights in five states, and a Surya Mitra programme for developing a cadre of trained manpower for the deployment of solar energy projects.

Singh said: “The above initiatives resulted in significant increase in renewable energy deployment.” According to the MNRE, in October 2017 the cumulative renewable power installed capacity was 60.98 GW. Out of this, 26 GW renewable power installed capacity was added between April 2014 and October 2017.

Quality norms
Singh also informed that there is no formal information relating to any specific solar equipment or component being of low quality and sold in the Indian market.

To impose strict quality norms for solar equipment and components, and to restrict low quality solar PV equipment in the Indian market, the central government, after consulting the Bureau of Indian Standards, has issued the “Solar Photovoltaics, Systems, Devices and Components Goods (Requirements for Compulsory Registration) Order, 2017” dated September 5, 2017, for the quality control of solar photovoltaic systems, devices and components.

As per the conditions given, the order shall come into force on the expiry of one year from the date of its publication in the official gazette. However, it has been decided to make the quality control order effective from April 1 this year to ensure the quality of products in the deployment target of 2018-19.

The order provides for certain conditions regarding the manufacture, storage, sale, distribution, etc. of solar systems, devices or components, including making an application to the Bureau of Indian Standards for obtaining a registration for use of the Standard Mark in respect of the Indian Standard.

Customs issue
The minister also took the opportunity to update the MNRE regarding consignments of solar panels imported from other countries. Some are being held up at ports due to customs classification issues resulting in disputes regarding the applicable rate of Basic Customs Duty on imported solar panels.

As informed by the Customs Authorities, the Government has put in place remedial measures by way of permission for bonding the cargo under Section 49 of the Customs Act, to avoid demurrage and detention charges. “Also, the solar panels are allowed the benefit of provisional release under Section 110A of the Customs Act,” Singh said.

Support for domestic manufacturing
Towards the end of 2017 the MNRE released draft schemes for encouraging domestic solar PV manufacturing in terms of earmarking certain projects for domestic content and a capital subsidy scheme (M-SIPS) for setting up of the solar manufacturing facility. However, no MoU has been signed with any country for setting up of domestic manufacturing, Singh said.

Regarding the incentives, Singh stated that the programme is being supported by the Government of India through a Special Incentive Package Scheme (SIPS)/ Modified Special Incentive Package Scheme (M-SIPS).

The scheme, inter alia, provides for 20-25% subsidy for investments in capital expenditure for setting up of the electronic manufacturing facility. And, reimbursement of Countervailing Duty (CVD)/ Excise Duty (wherever applicable) for capital equipment for the units outside Special Economic Zones (SEZ).

The incentives are available for several categories of electronic products and product components, including polysilicon, ingots, solar photovoltaic (SPV), cells, modules/panels. Units across the value chain starting from raw materials to assembly, testing, and packaging of these product categories are included.

Electric vehicles
MNRE has also stated that the Energy Efficiency Services Limited (EESL), under the Ministry of Power, plans to procure 10,000 e-vehicles through demand aggregation. Bids were invited via open tender and under Phase-I contracts have been awarded to Tata Motors Ltd. for 250 e-cars, and Mahindra & Mahindra Ltd. for 150 e-cars, which include five years Annual Maintenance Contracts (AMC).

“EESL will provide these vehicles on lease to replace the existing petrol and diesel vehicles taken on lease by various Government organizations and charge lease rent from these organizations,” Singh added.