Tech, human resource needed from China to kickstart solar PLI: Indosol

The first winner of the ‘production linked incentive’ (PLI) scheme for high-efficiency solar equipment in the country is still hunting for land and human resources for setting up its end-to-end integrated solar manufacturing facility. Speaking for the first time since their PLI win, Sharat Chandra, chief executive officer, Shirdi Sai Electricals Limited (SSEL) said their integrated solar equipment manufacturing plant is facing delays as they are unable to import the required technology and human resources from China and also facing difficulties in sealing the deal for land with any state.

Indosol Solar Private Limited (ISPL) is an SPV formed by Shirdi Sai Electricals Limited (SSEL), which is a Andhra Pradesh-based power equipment manufacturer. SSEL won 4 gigawatts of module manufacturing in phase I of solar PLI. In the second phase of PLI, Indosol Solar won 10 gigawatts of ‘polysilicon-wafer-cell-module (PWCM)’ manufacturing. Indosol is now executing both projects. He said, Indosol Solar has already operationalised 0.5 gigawatt of solar module manufacturing which it won in the first phase. It is the second phase that is the real challenge.

“From ingot (a key primary equipment) to modules, we have to rely on China for the machinery, because even the German manufacturers don't make them. Korea and Japan also manufacture but the scale is missing as our demand is in gigawatts. We are compelled to go to China,” Chandra said in an interview with Business Standard in Delhi.

The Indian government has put restrictions on the issuance of visas to Chinese nationals and permission is required in extraordinary cases. Technology transfer through vendor agreement would also require additional permissions.

This paper had reported in February, almost all the solar PLI winners have listed supply chain partners and service providers from China, with some of them mentioning more than 50 Chinese vendors. These companies have applied for an exemption on visas for these vendor partners and approval for importing the technology. Indosol Solar has listed 94 foreign vendors, out of which 65 are from China, documents accessed by Business Standard showed.

The PLI scheme aims to build indigenous manufacturing across key business sectors. India’s solar equipment demand is largely met through imports with China having the lion’s share. Among leading solar equipment makers, Chinese companies have the largest scale and end-to-end facilities.

Responding on the same, Chandra said, they need relevant people to just come and commission new manufacturing lines for them as there is no precedent in India. “Bringing in equipment is not a solution alone; it needs the people also. The industry has been appealing to MNRE. What we are asking for is only a concessional visa for some time for these people,” he said.

Chandra said their existing facility to manufacture modules is in Ramayapatnam, near Nellore, Andhra Pradesh and they wish to expand the same facility. “We want to have 8,000 acres of land which will include ancillary industries, township, common infrastructure such as roads and power, a desalination facility, storage, etc., compulsory 33 per cent green area. And additional land might be required for captive power generation. We are looking at 32,000 people getting direct and indirect employment by Indosol Solar,” Chandra said.

“These types of projects are land, water, and power intensive by default. State governments tell us they are struggling to put all these in one place and give it to us. Tamil Nadu said we will give you the land, but they cannot give us water. Our roots are in Andhra Pradesh, so we would like to have our plant there but the state is unable to give the large land bank that we require. Orissa is there but we would not get sufficient manpower. We are struggling to get land allocated to us in time,” Chandra said. The incentive under the PLI scheme is linked with the manufacturing deadlines. He added that Andhra has shown reluctance to offer subsidised electricity and has rather asked them to set up their own captive power generation.

Chandra said apart from the necessary technology required for PWCM, Indosol is trying to build its own indigenous supply chain for ancillary equipment such as glass and metallurgical silica for building solar modules. “Around 23 per cent of a solar module is glass and did not want to be dependent on anyone outside. We would require 40,000 tonnes of metallurgical silicon. If we start importing it, our modules will never be competitive to China. These are the two major materials that we plan to manufacture at our end,” Chandra said.

Indosol plans to make 1,000 tonnes of glass per day at its facility, according to the company’s website.