According to the IEA, developers are prioritizing high-performance, high-end modules to facilitate cost-effectiveness and low-cost financing. However, demand for these modules will outstrip supply in the short term, as major producers offering modules over 500 W reported total production capacity of less than 5 GW.
The April 2022 import tariffs on solar modules and cells led to a 30-40% price increase in the second half of the year, affecting the bankability of the project. As a result, developers had to postpone or cancel projects until solar prices fell. The government responded by postponing the ALMM requirements and extending the deadlines for commissioning projects ordered by April 2024.
While government action has addressed some challenges, a temporary supply-demand mismatch for high-end PV modules will prevent a rapid expansion of PV at utility scale in 2023 and 2024. However, the IEA predicts rapid deployment of PV in India after 2025, driven by higher PV modules. auction volumes and lower prices.
According to the report, India will achieve full self-sufficiency in the supply of solar electricity in the next four to five years, when the production capacity granted in the production-linked support system is put into use.
In summary, the IEA expects India’s renewable energy capacity addition to pick up in 2023 and 2024 with faster deployment of onshore wind, hydro and distributed solar.