Q1. What potential difficulties and consequences might India face as it seeks to curtail the import of solar panels while striving to meet its ambitious solar energy goals by 2030?

The Approved Models and Manufacturers of Solar Photovoltaic Modules (Requirement for Compulsory Registration) Order, 2019, requires module makers to submit to an inspection of their manufacturing facilities by the National Institute of Solar Energy. Being on the list as an ‘approved’ manufacturing facility certifies a company as legitimately manufacturing solar panels within its premises and not importing modules.

Challenges to Indian Manufacturers:

  1. Limited Domestic Capacity: India’s domestic industry may struggle to meet the demand for solar panels, as its current manufacturing capacity falls short of the required quantity. This could result in delays in project implementation and hinder progress towards meeting renewable energy targets.
  2. Increased Costs: Restricting imports could lead to higher costs for solar power projects, as domestically manufactured panels may be more expensive than imported ones. This could impact the affordability of solar energy, potentially slowing down adoption rates and hindering the transition to renewable energy.
  3. Quality Assurance: While promoting domestic manufacturing is important, ensuring that domestically produced panels meet stringent quality standards is crucial. Without proper quality control measures, there may be concerns regarding the reliability and efficiency of domestically manufactured panels, which could undermine confidence in solar energy solutions.
  4. Competitive Disadvantage: Domestic manufacturers may face challenges in competing with cheaper imported panels, particularly from countries like China, which dominate the global market. This could result in a loss of market share for Indian manufacturers and negatively impact the growth of the domestic solar industry.
  5. Supply Chain Disruptions: Dependence on domestic manufacturing may leave India vulnerable to supply chain disruptions, such as shortages of raw materials or manufacturing components. This could further impede the scaling up of solar energy capacity and hinder progress towards renewable energy goals.

The benefits of the Approved List of Models and Manufacturers (ALMM) for Solar Photovoltaic Modules:

  1. Cost Reduction for Manufacturers: The reforms in ALMM, such as the reduction in application and inspection fees, help in reducing the financial burden on solar PV manufacturers. This makes it more affordable for manufacturers to participate in the enlistment process and promotes domestic production.
  2. Time Efficiency: By streamlining the application process and allowing for provisional enlistment within a short timeframe, ALMM reforms reduce the time between application to enlistment. This enables manufacturers to start production and supply of solar modules more quickly, contributing to meeting the demand for solar energy in a timely manner.
  3. Compliance Burden Reduction: Exempting factory inspection for additional models similar to those already enlisted reduces the compliance burden on manufacturers. This simplifies the enlistment process and encourages manufacturers to introduce new models or variations, fostering innovation and diversity in the market.
  4. Ease of Doing Business: The introduction of digital application processes and the reduction of paperwork streamline the ALMM process, making it easier for manufacturers to comply with requirements. This enhances the overall ease of doing business in the solar PV industry, attracting more players and promoting competition and growth.
  5. Promotion of Domestic Production: ALMM plays a crucial role in promoting domestic production of solar photovoltaic modules. By providing incentives and facilitating easier access to the market for domestic manufacturers, ALMM reforms encourage the growth of the domestic solar industry, contributing to self-reliance and energy security.
  6. Alignment with Renewable Energy Goals: The reforms in ALMM support India’s renewable energy goals, including the target of achieving 500 GW of non-fossil fuel-based energy capacity by 2030. By facilitating the ramping up of domestic production, ALMM contributes to meeting the increasing demand for solar energy and advancing towards sustainable energy development.

Conclusion: While promoting domestic production aligns with India’s goal of achieving energy security and reducing dependence on imports, addressing these challenges effectively is essential to ensure a smooth transition towards meeting ambitious solar energy goals by 2030.

Source The Hindu

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