The Adani Group is going to build the world’s largest renewable energy manufacturing hub in Mundra, Gujarat, which will house production units of almost all things that go into green energy generation facilities, including polysilicon, ingots, wafers, cells, solar modules and even wind turbines, senior officials from Adani Solar said.
Besides, the group is also going to manufacture all the ancillaries needed in the production of the above-mentioned items at the same location, Mundra. Ancillaries for which the company is setting up production units include glass, ethylene vinyl acetate (EVA) films, backsheet and aluminium frames, all used in solar panels.
“It is going to be the world's first and only vertically, and if I may use the word, horizontally integrated ecosystem for solar manufacturing. Besides, our sister company Adani Wind is also going to expand its wind turbine manufacturing capacity from the current 1.5GW to 5GW at Mundra itself. Even China does not have manufacturing of all the ancillaries and the fully integrated ecosystem in one place,” Rahul Bhutiani, head of sales and marketing at Adani Solar, told Moneycontrol.
China may have large solar manufacturing capacities of 20-40 GW or even more under a single company, but that manufacturing unit, though large scale, is focused on only one piece of the supply chain. For example, if a company is making wafers in China, it will do 100GW of wafers only. Another company would do, say, 50GW of polysilicon alone and a third company would do 50GW of cell manufacturing. China has a manufacturing scale but lacks an integrated ecosystem geographically co-located under a single company.
When asked the reason for the complete integration of manufacturing of all renewable energy materials at one location, Bhutiani said it “becomes faster and cheaper”.
“If I have ancillaries such as glass for solar modules being produced at the same location, my transportation cost comes down drastically. We have the Mundra power plant, so electricity is not an issue. Mind you, polysilicon, ingots and wafer manufacturing requires a lot of electricity. Then we have the Mundra port very close by, which is also operated by the Adani Group,” he said.
“So for our shipments, even if I have to send something to Chennai, I can just use the ship to land in Chennai and then from there, use the road to deliver it. It's faster and cheaper. So the port also becomes a very big factor in this whole decision-making,” Bhutiani added.
The co-location of the manufacturing units and the port also makes it easier for the company to export its products. Adani Group’s installed nameplate capacity of solar modules is 4GW at present and it will produce about 3.8 GW this year, of which its exports will be to the tune of 3-3.1GW, while only the balance will be sold in the domestic market due to low demand.
Capex requirement
As per its recently announced plan, the Adani Group is going to set up manufacturing capacities of 10GW each of polysilicon, ingots, wafers, cells and solar modules by 2027. This will be executed by Adani Solar.
The group’s current total manufacturing capacity in Mundra is 4GW of solar modules, 4GW of cells and 2GW of wafers. While these will be expanded to 10GW each in a phased manner, a separate 10GW polysilicon unit will be built in one go.
When asked about the capex requirement for setting up the manufacturing units for solar parts, Bhutiani said it would be around Rs 300 crore. “We will just stagger the capex. Institutions such as REC and PFC are the nodal agencies for funding these projects in the solar domain or renewable domain. We will be approaching them for the debt portion. Of course, they need a matching equity component to be brought in, and that we will bring in either through promoter funding or internal accruals,” he said.
Talking about the group’s plans in wind turbine manufacturing, the official said its capacity will be expanded to 5 GW. Adani Group is also building India’s largest upcoming hybrid (solar and wind) renewable energy park (20 GW) in the Khavda desert in Gujarat.
Adani Solar and Adani Wind have been incubated by Adani Enterprises Limited (AEL), the flagship company of the Adani Group. The Group has now set up another company Adani New Industries Ltd. (ANIL) to produce the lowest-cost renewable energy and products across the value chain through an integrated supply chain mechanism. Adani Solar and Adani Wind will soon become a part of ANIL.
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