Centre tightens disclosure norms for domestic solar manufacturers

In a move to tighten scrutiny of domestic Indian solar cell and module-manufacturing companies, the Centre has ordered them to upload details of their annual imports and exports and the location of their manufacturing facilities on two online portals.

About the news:

• The government has ordered solar cell manufacturers to upload details of their annual imports and exports, as well as the location of their manufacturing facilities on two online portals
• The move by MNRE comes in the backdrop of allegations by some manufacturers that imported solar cell are being passed off as domestic cells by some in the industry to claim DCR status.
• The Ministry of New and Renewable Energy (MNRE) recently amended a provision under the “Approved Modules and Manufacturers of Solar Photovoltaic Modules (Requirement for Compulsory Registration) Order, 2019.”
• MNRE’s latest provision establishes an online portal operated by NISE.
• This portal collects data on production, sales, and exports from solar PV manufacturers. Manufacturers enlisted in the Approved list of Models and Manufacturers (ALMM) must enter data on this portal regarding their solar PV manufacturing facilities starting from April 2023.

Objective of the reform:

• The new clause aims to improve the verification process for domestically manufactured content.
• The provision mandates that NISE’s portal will ensure traceability of domestically manufactured solar PV cells and modules.
• It will also assist in verifying Domestic Content Requirements (DCR) for solar PV modules deployed in the country.

Significance:

• The order was introduced to address India's heavy reliance on imported solar modules, especially from China, and to promote the local manufacturing of high-quality solar panels.
• It also aims to protect the domestic solar industry from the influx of low-quality imports and to encourage the production of solar modules within the country.
• Foreign companies can participate if they establish manufacturing facilities in India and pass the inspection to be listed as approved manufacturers. This promotes foreign investment in India’s solar sector while ensuring technology transfer and quality production.
• By promoting domestic manufacturing, the order supports India’s ambitious solar energy targets, including sourcing 280 GW from solar power by 2030. Increased local production is crucial for meeting these targets by ensuring a steady supply of solar panels and components.

Challenges:

• One concern is whether India's existing manufacturing capacity can meet the surge in demand driven by government projects and incentives. Additionally, there’s uncertainty about the global solar market dynamics, especially with potential changes in trade policies affecting imports and exports of solar components.