Removal of domestic content requirement in solar not a big blow

The solar Domestic Content Requirement (DCR) policy has always been contradictory – the government doesn’t want cheaper imported panels, but wants solar power at the lowest possible price. Locally manufactured panels for DCR projects costs at least 10% more, and interest in these higher-cost projects has waned said Raj Prabhu, CEO of Mercom Capital Group.

The Ministry of New and Renewable Energy (MNRE) called a meeting with the representatives of the solar industry recently to address their concerns regarding the domestic content requirement.

“In the meeting it was highlighted that there is unwillingness on the part of some states to participate in these projects as they are finding it too expensive; there was also a lack of developers interested in DCR projects. Proposals for a fixed amount in subsidies for domestic cell and module manufacturers based on manufacturing capacity was talked about. Other plans discussed included manufacturers getting viability gap funding (VGF) support for large projects,” said Prabhu.

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