According to sources around 420 mw of projects missing commissioning dates and with this India is not likely to register any significant year-over-year installation growth for 2013, even as global solar market is forecasted to grow 20%.
It has been a quiet year for the Indian solar sector, with installations at 900 mw so far this year and final numbers forecasted to be similar to last year.
The guidelines and requests for selection have finally been published for Phase II Batch I, for 750 MW of PV projects. Unfortunately, India has decided to include domestic content requirements for half (375 MW) of PV projects, which may be enough to cause a trade dispute but not enough to help domestic manufacturers. It is an unnecessary risk that raises uncertainty with minimal reward.
According to the proposed time line, these 750 MW of JNNSM Phase II projects will not be commissioned until at least May 2015. Therefore, projects under Indian state schemes are where the action will be in 2014.
The challenges faced by the Indian economy this year also affected solar industry. This year the market has seen high inflation, a 8 % rise in module prices and a 15% rupee depreciation, all of which contributed to overall project costs. At the same time, reverse auctions in India continue to defy odds and go in the opposite direction with record low bidding, especially in states that have an L1 type bidding mechanism (lowest bid must be matched by all) in place. Current economic conditions, sollar irradiance and off-taker creditworthiness do not look to be reflected in these bids. With bids fluctuating almost 50 % over the year when comparing state-to-state, it is imperative to have deep insight and market intelligence to be successful in this environment.
India is entering election season with state elections in Chhattisgarh, Madhya Pradesh, Mizoram, Rajasthan and Delhi due next month. According to the guidelines by the Election Commission of India, non-agricultural land transactions cannot be approved by the government during election season without the approval of the Chief Electoral Officer. This will delay any solar projects that are in the middle of land acquisitions by a few months.
With some states yet to sign PPAs and upcoming state and general elections, our preliminary estimates are tentatively at 1,750 MW of solar installations in India for 2014. Although the projected installation growth looks impressive, it includes 420 MW of CSP projects that did not get installed in 2013.
No comments:
Post a Comment