India adds 4.5 GW solar in H1 2021 as local producers line up expansion plans
India added 4,578 MW (or 4.58 GW) of solar in H1 2021, exceeding the 3.2 GW of solar installed in all of calendar year 2021 - as per Mercom India Research's report Q2 2021 India Solar Market Update.
The report said India added 2.4 GW of solar in Q2 of calendar year 2021 - a 19 percent increase quarter-over-quarter compared to 2 GW installed in Q1 2021.
"Solar installations were up 1,114 percent year-over-year (YoY) compared to 205 MW added in Q2 2020 when COVID crippled the sector. Solar capacity additions in India in Q2 2021 were the highest in a quarter since Q2 of 2018," read the report.
The higher number of recent installations are attributed to the Indian solar industry being more prepared for business during the second lockdown than they were during the first. The report added that the solar industry saw the increase in installations despite state-level lockdowns amidst the second wave of COVID-19.
In a statement, Raj Prabhu, CEO of Mercom Capital Group, said, "Even with a strong quarter, the industry continues to battle uncertainties around higher component costs and logistical issues. With duties and import restrictions, purchasing quality solar components at the best price will be the biggest challenge for the industry going forward as solar system costs ticked up for the fourth quarter in a row."
According to the report, at the end of Q2 2021, cumulative solar installations reached 43.6 GW. India’s large-scale solar project development pipeline stands at 52.8 GW, along with 28 GW of projects tendered and pending auction at the end of Q2 2021.
With the focus of the solar sector in India shifting towards domestic manufacturing, local producers are ramping up their capacities.
Indian players eyeing growth
But manufacturing and installation in the solar industry can be labour intensive. As Waaree found out last year, workers returning to their hometowns on account of the COVID-19 pandemic can lead to disruption of business.
But as the solar sector makes a comeback, as evidenced by the Mercom report, Waaree plans to not only increase its total capacity to 5GW and triple its revenues, but also increase its focus on manufacturing solar cells, lithium batteries, solar-enabled agriculture pumps, inverters, and more.
Waaree was started in 1989 by Hitesh Doshi as a thermal equipment trading business. Little did Hitesh know he was embarking on a journey towards building one of India’s largest solar PV module manufacturing business - Waaree Energies - amidst tough competition from China.
Hitesh Doshi, Chairman and MD, Waaree
Gautam Solar is another prominent player in the space, and it plans to reach 2.5GW capacity in a few years.
Despite the presence of Waaree and Vikram Solar in the panels market, and Tata Power and Shakti Pumps in the pumps market, it remains optimistic about the future.
Second gen entrepreneur Gautam Mohanka told SMBStory recently that while the market is competitive, "the leading players maintain a level of trust with one another, often supplying each other with components that are not made in-house at the buyer’s end."
Vikram Solar also recently announced a new 1.3 GW solar PV module facility in Tamil Nadu, which takes its cumulative PV module manufacturing capacity to 2.5 GW - one of the largest in India.
It was also recently reported that Vikram and Waaree, in a bid to expand and ride the wave of growth in India, have hired investment banks for line up their IPOs.