India’s cumulative rooftop solar capacity reached 7.6 GW by March 31, with 456 MW added in the first quarter, according to a new report by Mercom India.
Rooftop solar installations rose 34% year on year in the January-March period. They accounted for 15% of 3 GW of quarterly solar installations.
The commercial and industrial segment once again accounted for most of the rooftop solar installations in the first quarter. The industrial segment contributed 47% of total quarterly additions.
About 71% of rooftop solar installations were under the capex model. The operating expenditure/renewable energy service company model contributed 29%, said Mercom.
“States have been empaneling vendors and commissioning the allocated capacities under the Ministry of New and Renewable Energy’s Phase II Rooftop Solar Program, driving capex installations,” said the report.
Gujarat leads other states in cumulative solar rooftop installations, with about 1.8 GW installed byon March 31. Maharashtra and Rajasthan rank second and third, said Mercom.
Overall project margins have fallen with the rise in component prices, the imposition of basic customs duty (BCD) on module and cell imports, and the hike in the goods and service tax. In the first quarter of 2022, the average cost of a rooftop solar system increased by 6% on a quarterly basis from the final three months of 2021. Year over year, rooftop solar system costs increased by 17%.
“It was another great quarter for the rooftop solar market as post-covid installations continued to surge. Rooftop installations have topped 400 MW for four quarters in a row, which is a first,” said Raj Prabhu, CEO of Mercom Capital Group. “However, future growth is dependent on system costs. If the prices continue to go up and project economics deteriorate, demand is bound to contract in the short term.”
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