Bengaluru: The Union Government’s attempt to protect the domestic solar cell manufacturers, by imposing duty on cheaper imported ones, has upset the solar developers, who fear it will lead to an increase in solar energy tariffs.
On July 30, India imposed safeguard duty for two years on the solar cells imported from China and Malaysia, after Indian Solar Manufacturers Association filed an application with Directorate General of Trade Remedies (DGTR), arguing that the surge in imports of solar products was jeopardizing their business.
However, the solar developers have objected to the move and requested the Finance Ministry to exempt ongoing projects from the curbs.
In terms of renewable energy installation, Karnataka recently topped the list with 5.16 GW. Solar energy developers say that the projects in the state too would get affected with the imposition of safeguard duty.
"The implementation of 25% of safeguard duty dissolves the uncertainty brewing over the last few months. The developer community can now factor this in and plan future projects in accordance. While the entire industry was expecting safeguard duty to imply once the stay order from Orissa High Court is lifted, what surprises the industry is the implementation of safeguard during the period of stay from Orissa High Court,” said Nikunj Ghodawat, CFO, CleanMax Solar.
He further added that though he was in complete support of supporting the domestic manufacturers of solar panels, the current move would definitely lead to the slowdown in the sector.
More than 10,000 MW capacity solar panels are imported annually from China and Malaysia and the developers are apprehensive that the
safeguard duty would lead to an increase in solar tariff by 40 paisa per unit.
“The increased tariffs will be ultimately passed on to the customers, hampering adoption of clean energy. The current move of the government may adversely impact the commercial viability of some solar projects,” Ghodawat added.
The union government has plans to achieve 100 GW of solar energy by 2022, out of which 23.12 GW had already been installed in July.
