ALMM expands market for domestic solar manufacturers

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India’s Ministry of New and Renewable Energy (MNRE) has reinstated the ALMM [Approved List of Models and Manufacturers] mandate from April 1, 2024. As per the ALMM order, only the solar products and manufacturers making to the MNRE-approved ALMM list are eligible for government-backed projects and government projects supplying electricity to discoms for consumption by the public. The policy was introduced by the MNRE to safeguard the domestic industry from dumping of Chinese products and ensure the use of quality solar cells and modules in PV projects.

As per the ALMM order dated Feb 9, 2024, “The ALMM will apply only to those projects which are sponsored/subsidized by the government. ALMM will apply to the government or its agencies
procuring power for their own consumption or for distribution to the people through distribution companies. ALMM will apply to solar PV rooftops and PM KUSUM projects, which are subsidized. The ALMM will not apply to projects set up under open access or as captive by private parties. In other words, ALMM will not be applicable for people who set up their own capacity.”

The ALMM list includes models and manufacturers of solar modules complying with the BIS standards (Bureau of Indian Standards). The ALMM list for cells has not yet been issued.

Currently, only the companies manufacturing in India feature in the list. Thus, the ALMM mandate gives the domestic manufacturers the opportunity to serve a sizeable market by creating a non-tariff barrier for Chinese products.

“The mandatory use of ALMM modules ensures that Chinese modules are excluded, offering a substantial boost to Indian module manufacturers. This not only expands the market for Indian manufacturers but also shields them from competition with Chinese counterparts, fostering indigenous solar production and innovation,” says Tanmoy Duari, CEO, AXITEC Energy India.

Goldi Solar is one among the ALMM listed PV manufacturers. It has committed to investing INR 5,000 crore by 2026 to establish module manufacturing of 6 GW and cell manufacturing of 5 GW.

Ishver Dholakiya, managing director and founder, Goldi Solar, says, “ALMM is a levelling mechanism, providing domestic manufacturers with a notable edge and fostering a favourable environment for Indian players…This presents a golden opportunity for local manufacturers, particularly in two key sectors: rooftop solar and utility-scale projects. Rooftop solar holds vast potential, witnessing rapid expansion in both residential and commercial markets. Meanwhile, utility-scale projects play a critical role in driving large-scale clean energy production, with ALMM ensuring the deployment of high-quality, domestically sourced solar panels for such initiatives.”

While exports have historically been a focus for major Indian PV manufacturers, ALMM necessitates a shift towards fulfilling the needs of the Indian market. This is because ALMM incentivizes the use of domestically manufactured solar panels in projects, thus creating a surge in demand within the country.

“By prioritizing the domestic market, manufacturers can benefit from the growing demand for solar energy in India, driven by initiatives like the National Solar Mission and various state-level policies… However, this doesn’t mean manufacturers will entirely forego export opportunities. They may still pursue international markets where their products remain competitive in terms of quality and pricing. Overall, ALMM’s impact on major manufacturers involves a strategic shift towards serving the domestic market while also exploring selective export opportunities to maintain global presence and leadership for Made in India products,” says Dholakiya.

Supply

Anurag Garg, CEO, Jakson Solar Modules & Products Business, says ALMM has been reimposed by the MNRE after India achieved an operational manufacturing annual capacity of over 40 GW listed in ALMM, with another 30 GW under execution by different manufacturers across the country. This is much more than the annual demand for solar modules in the country, including export demand.

Jakson, an ALMM listed solar panel manufacturer, is expanding its module manufacturing capacity to 1.2 GW with the addition of a 600 MW line. The new line will produce glass-glass mono PERC and TOPCon modules with up to 16 busbars.

Garg said, last year, domestic module manufacturing capacity was underutilized, even with 20 GW installed capacity. Now, with over 40 GW operational capacity, he doesn’t foresee any challenges in module availability for PM Suryoday and Suryaghar Yojna programs if the operating capacities of domestically produced cells align with the demand for DCR modules.

A shortage of domestic cells could lead to a substantial increase in the cost of DCR modules, as we observe a price difference of more than 120% between domestic and imported cells, even after applying a duty of 25%, Garg added.

Notably, residential rooftop solar installations under PM Surya Ghar: Muft Bijli Yojana must use solar modules manufactured in India from domestically manufactured cells to be eligible for the central financial assistance.

Currently, solar panel manufacturing in India is largely dependent on China for solar cells and various other components/BOM items such as glass, frames, backsheets, and encapsulants.

“In the past, we have seen how the basic prices of BOM items, especially cells that are imported, are controlled and tweaked—from going too low to too high—based on Indian government policies to discourage the expansion plans of Indian manufacturing, which significantly affects the prices of solar modules. Therefore, [the ALMM mandate] is a step is in the right direction to ensure government support and push for domestic manufacturing, ensuring minimal dependence on imports,” said Garg.

 

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