China’s CSUN faces India ban over PV module contract disputes

The Indian government plans to blacklist solar module supplier China Sunergy (CSUN) as the latter has failed to meet its contractual obligations with Indian project developers.

“We will soon issue an advisory to people not to buy from them,” new and renewable energy secretary Anand Kumar told Economic Times while sharing the development.

The ministry is also planning to prepare a list of approved suppliers to shield Indian companies from the risk of dealing with unreliable suppliers, he said.

The move comes after Indian solar project developers Acme Solar, RattanIndia and Refex Energy complained to the ministry that CSUN had failed to honour PV module supply contracts with them.

Acme Solar had signed a PV module supply deal with CSUN for an aggregate capacity of 30 MW. The former paid an advance of $2.95 million, which was about 30% of the purchase price or equal to the cost of 9MW of equipment. CSUN failed to dispatch 9W of modules by the agreed deadline, and did not return the advance either, Economic Times reported from Acme Solar’s petition at the International Arbitration Centre.

CSUN also defaulted on 40 MW module supply order placed by Refex, and did not return the advance ($1.12 million) paid either, it said.

Yarrow Infrastructure, part of the RattanIndia Group, claimed that it received only 2.77 MW under 20 MW module supply agreement with CSUN, the report added.

CSUN has a solar module production capacity of 1.2 GW.

Significantly, India’s aggressive ‘100 GW by 2022’ solar target has bolstered use of cheaper Chinese PV modules, where in FY18 alone around 9.8 GW of solar modules were imported attributing to 85% of India’s demand.

German EPC’s experience with the supplier

Last year, Monika Leiner, purchasing manager at the German EPC company Goldbeck Solar shared some learnings from the unfortunate module supply deal signed with CSUN in 2017. At the time, Goldbeck Solar claimed it hadn’t receive a single module, and was only refunded a fraction of the deposit paid.

As China does not have a dispute resolution process corresponding to the European model, it is unclear whether the remainder of the deposit will ever be reimbursed. Only after immense pressure from the EPC did the Chinese company acknowledge the existence of the financial claim, said Goldbeck Solar.