By Biswajit Choudhury
Changzhou (China)– Trina Solar of China, the largest manufacturer of solar photovoltaic (PV) panels globally and India’s biggest supplier, awaits further easing of business conditions for the sector to begin production in the country for which the company has acquired land in Andhra Pradesh, according to Chairman and CEO Gao Jifan.
In an exclusive chat here with Indian reporters on the sidelines of the 20th anniversary celebrations of the Chinese solar giant, Gao said he also had occasions to speak about the importance of developing the Indian solar market with Prime Minister Narendra Modi at a time the country is in a mission mode on solar energy as a co-founder of the Gurugram-headquartered International Solar Alliance.
The sheer scale of Trina’s achievements testify to its pride of place in China, which has been struggling with its own emission problems. Founded in 1997, it became the first solar PV maker to be listed in the New York Stock Exchange in 2006. The company has already shipped 32 gigawatt (GW), or 32,000 megawatt (MW), of modules to the rest of the world. Its products are available in 70 countries and shipments last year alone amounted to 9 GW.
Trina, which specialises in the manufacture of crystalline silicon PV modules and system integration, currently has about 10 per cent share of the global market. It also produces ingots, wafers and solar cells. It has over 20 per cent share in the Indian market and has cumulatively supplied 3 GW of equipment.
Gao explained that while India will continue to be a prime market for Trina, module-making is a high-investment activity and costs of manufacturing in India are very high. Solar power tariffs, as discovered through competitive bidding, have, however, been falling at the same time and are currently below Rs 2.50 per unit.
“Unfortunately, PV manufacturing lacks a supply chain in India and we prefer to import equipment from overseas,” Gao said.
“If costs of making in India do not support the economics of production for the customer, it makes our job difficult. Our basic principle is to provide value for the customer. If the local customer cannot afford our products, that makes it difficult for us to produce,” he said.
Another gap in India is the lack of reliable power supply for production, he said.
The company has signed an MoU with the Andhra Pradesh government to set up a manufacturing plant with an investment of Rs 2,800 crore. Around 90 acres of land have been earmarked for the proposed unit at Atchutapuram in Visakhapatnam district. State Chief Minister Chandrababu Naidu has said the factory would create employment opportunities for 3,500 people.
Trina had, in 2014, supplied 600,000 panels for India’s largest solar project of 151 MW at Neemuch in Madhya Pradesh.
“I hope India opens up the PV market,” Gao said, underlining the importance of producing locally if Trina wants to grow in the country. However, the lack of a developed domestic supply chain means that production is not cost-competitive. Nearly 90 per cent of India’s solar panels are imported, while Indian manufacturers have to depend on accessories from China.
India’s national solar programme, launched in 2010, has a domestic content requirement clause in order to protect and encourage local industry. It mandates that a solar power producer compulsorily source a certain percentage of solar cells and modules from local manufacturers in order to be able to benefit from the government guarantee to purchase the energy produced.
In this connection, a World Trade Organisation panel has earlier ruled that India’s domestic content requirement for the solar sector is inconsistent with its treaty obligations.
Besides, cheaper Chinese imports have provoked industry bodies like the Indian Solar Manufacturers’ Association to demand safeguard levies and anti-dumping duties.
On the other hand, with the sharp fall in solar and wind tariffs in India, as well as in equipment costs, government incentives had dried up, according to solar stakeholders.
A recent report by global accounting firm KPMG says that in the absence of strong local manufacturing, India will need to import $42 billion of solar equipment by 2030, corresponding to 100 GW of installed capacity.
The latest Bloomberg New Energy Finance report on the Indian solar sector, titled “Trade Dispute Overshadows Rising Market”, projects India’s solar cells and PV market, currently at 8.6 GW, to cross 12 GW by 2020. Around 90 per cent of Indian imports of PV cells and modules last year came from China and were worth over $3 billion.
Gao also said that Trina has set up a new business vertical to develop the rooftop solar market for the residential segment, as well as for big and small industry, the total size of which in India is around 1 GW. (IANS)