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Mint
3 days ago
- Business
- Mint
Another PLI scheme hits the Chinese wall, as India now mulls extension for projects under solar module incentive scheme
New Delhi: The government is considering extending the deadline for completion of projects under the Production Linked Incentive (PLI) scheme for solar modules and their parts, said two people in the know of the development, amid delays in technology sourcing and component supply from China. The ₹19,500 crore scheme for fully and partially integrated solar PV module manufacturing has scheduled commissioning dates from October 2024 to April 2026. Data from the ministry of new and renewable energy showed that around 17.5 GW of module manufacturing capacity had been completed by First Solar, Avaada, Grew, Tata Power Solar and Indosol, out of the awarded 48.3 GW awarded to several companies. Also read: India's power demand to grow 5.5% in FY26: Icra Of the 44.9 GW cell manufacturing capacity awarded to several companies, only 6 GW has been completed by Tata Power Solar and ReNew. In terms of ingot and wafer manufacturing, only 2 GW capacity has been completed by Adani Group, out of the overall 37.5 GW awarded capacity. 'A key reason of the delay has been lack in supply of components and technology transfer from China, and also the curb on travel of technicians from there," said an industry executive on the condition of anonymity. The ministry of new and renewable energy (MNRE) is in talks with the finance ministry for extension of the deadline after the industry reached out to the government with a similar request. 'The extension may be given on a case-by-case basis and wherever the issues pertain to supply chain constraints. The talks are underway between MNRE and finance ministry and a final decision is yet to be taken," said one of the two people mentioned above. Also read: BEML plans to develop light infantry vehicles, future-ready combat vehicles Industry players in the past few months have also reached out to the ministry of external affairs (MEA) to relax visa restrictions for technicians which have also impacted the project implementation. But so far the issue has not been resolved amid national security concerns, added the industry executive mentioned above. 'The MEA has also been given some specific names of required technicians who need to travel, but approvals have not come yet," the executive said. Queries mailed to the MNRE, MEA, Adani Group, Avaada Group, Reliance Industries and Indosol remained unanswered till press time. Another executive with a module manufacturer under the PLI scheme said: 'India currently remains entirely dependent on imports for equipment and critical materials for module manufacturing and is vulnerable to global supply chain disruptions and price fluctuations. Also, travel restrictions linked to engineering and equipment adversely impacted execution planning leading to further delays. Since most of the critical materials are made to order, any delays in placing orders will push the delivery timelines further." The executive added that current global tariff and trade dynamics have affected supply chains and led to uncertainty in placing orders for equipment leading to delays to timelines. However, Amit Paithankar, whole-time director and chief executive officer, Waaree Energies Ltd, said: 'Our PLI-supported project is on track. Various stages of the project—including engineering and procurement—are progressing as planned. While there were some initial delays due to supply chain constraints and the availability of trained manpower (both within India and internationally), these issues have now been addressed and the project is moving forward smoothly." Solar component manufacturing has been a key focus area for the government as India aims to reduce import dependence from China. Although in the past few years India has significantly grown its module and other component manufacturing, the lack of supplies of sub-components and technical assistance from China has in the past couple of years impacted the domestic manufacturing. The government has also imposed tariff and non-tariff barriers on solar modules including high basic customs duty and an Approved List of Models and Manufacturers for supply of modules to government-backed projects. Further, earlier this year, the MNRE said it will introduce a similar list for solar cells starting June 2026. In December 2024, the finance ministry imposed a provisional anti-dumping duty on textured, tempered, coated and uncoated solar glass imports from China in the range of $673-677 per tonne and $565 per tonne for imports from Vietnam. Following this the price of solar photovoltaic (PV) modules increased by 10-12%. Mint in January wrote that the increase in prices has raised concerns among industry participants over project cost escalations and potential delays. Also read: ONGC-led JV resumes production from 'PY-3' offshore field in Cauvery basin Currently, the country has about 80 GW of module manufacturing capacity including those under the PLI scheme, according to MNRE data. India's cell and wafer manufacturing capacity stands at 25GW and 2GW respectively. The Centre aims to have an installed capacity of 100GW for cells and 40GW for wafers by 2030 and also become an export hub. Indian manufacturers are also exporting modules, with the US being the largest procurer. As India aims to become a manufacturing hub for renewable energy components, the Centre is also pursuing direct government-to-government engagements with African and West Asian nations to open new markets for Indian green energy firms and solar equipment manufacturers.
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Business Standard
16-05-2025
- Business
- Business Standard
Transmission capex, renewable energy segment may energise Tata Power stock
Tata Power reported strong results in the fourth quarter of 2024-25 (Q4FY25) . Consolidated revenue rose 8 per cent year-on-year ( Y-o-Y) to ₹17,100 crore and net profit surged 25 per cent Y-o-Y to ₹1,300 crore. Operating profit grew 39 per cent Y-o-Y to ₹3,200 crore. The company added 1,026 megawatt (MW) of renewable energy (RE) capacity in FY25, including 166 MW in Q4. The 4.3 gigawatt or GW module and cell facility is at 90 per cent utilisation with all four cell lines active. The solar engineering procurement and construction or EPC order book is at ₹11,400 crore for utility-scale projects, ₹864 crore for rooftop and ₹1,036 crore for third-party rooftop. The RE segment will drive growth. Depreciation was up 7 per cent Y-o-Y to ₹1,100 crore and interest up 7 per cent Y-o-Y to ₹1,200 crore. Tax dropped 40 per cent Y-o-Y to ₹290 crore. Revenue from generation increased 9 per cent Y-o-Y to ₹5,300 crore. Plant load factor (PLF) for thermal declined to 73 per cent in Q4FY25 ( 74 per cent last year). PLF for solar was 25 per cent in Q4FY25 (24 per cent last year) and for wind was 13 per cent in Q4FY25 (14 per cent last year). PLF for Mundra increased to 73 per cent in Q4FY25 ( 60 per cent last year). The hydro PLF was at 30 per cent in Q4FY25 (36 per cent last year). Revenue from RE was stable at ₹3,500 crore. Revenue from transmission and distribution rose 6 per cent Y-o-Y to ₹9,600 crore. Another 5.5 GW is to be commissioned in the next 6-24 months. For FY25, consolidated revenue increased 6 per cent Y-o-Y to ₹65,400 crore, while operating profit stood at ₹13,900 crore. Reported net profit was ₹3,970 crore (up 7 per cent Y-o-Y). Capex of ₹16,200 crore was incurred in FY25, including ₹4,100 crore in Q4FY25, lower than guidance of ₹21,000 crore. New RE capacity in Q4 stood at 166 MW, less than guidance of 0.6GW. Tata Power Solar had revenues of ₹3,110 crore (down 27 per cent Y-o-Y, up 78 per cent Q-o-Q), with a healthy margin of 7.1 per cent and operating profit of ₹220 crore. Management believes margins of 7-8 per cent are sustainable. Tata Power benefits from transmission capex, reforms in distribution and green capex. It targets RE capacity of 15GW by FY27 and has capex plans of ₹84,200 crore for FY24-27. It is implementing 2.8GW of pumped hydro storage projects. Other positives are improvement in Odisha distribution, better returns in Mundra and cell and module ramp-up. Odisha discoms saw net profit increasing by 3 times to ₹275 crore. The rooftop business will almost double in FY26. For FY26, the capex target is ₹25000 cr (60 per cent for RE expansion and 30 per cent for transmission and distribution). Guidance is for 2.5-2.7GW of new RE capacity in FY26. Bidding for state discoms in UP may be a new trigger. In cell and module, guidance is for over 3,700 MW. In FY25, about 3,300 MW of modules were supplied. In Q4FY25, 913 MW of modules and 650 MW of cells were supplied. The Mundra generation, coal and shipping cluster reported ₹170 crore net profit (₹40 crore loss in Q4FY24). Net profit from Mundra plant improved from ₹57 crore in FY24 to ₹110 crore in FY25, with all five units under Section 11, and regulatory gain of ₹32 crore. The aggregate transmission capacity, including ongoing projects, will be over 7,000 circuit kilometres or ckm (2,414ckm under construction). The 600MW Dagachhu hydro project in Bhutan has started, with completion by Nov 2029. Net debt was ₹44,700 crore, while net debt to operating profit ratio was 2.93 times. The net debt:equity improved to 1.0 time from 1.1 times in Q3FY25.
