Centre has banned the use of an imported wafer used in making solar cells and modules that are meant for government schemes and projects, an order by the Ministry of New and Renewable Energy (MNRE) has said.
The order comes after it was found that some manufacturers are importing semi-processed solar cells, also known as blue wafers, to make modules instead of producing cells from scratch in India. The government has already issued a timeline of mandating the use of domestically-produced solar cells to make solar modules, and the order aims to push manufacturers to import only undiffused silicon wafer, or black wafer, to make cells in India.
The order, issued on March 11, said that a solar photovoltaic cell (based on crystalline-silicon technology) shall be considered domestically manufactured only if the same has been manufactured in India using undiffused silicon wafer, or black wafer. The order again specified that all steps and processes required for manufacturing the solar PV cell from black wafer have to be carried out in India.
“If diffused silicon wafer, also known as ‘blue wafer’, is imported and the same is used as raw material for the manufacture of solar photovoltaic (PV) cells in India, such solar PV cells shall not qualify as domestically manufactured solar PV cells, for the purpose of MNRE's schemes/programmes mandating use of domestically manufactured solar PV cells,” read the government order.
Government schemes such as PM Surya Ghar Muft Bijli Yojana, PM KUSUM and the renewable energy tenders issued by public sector undertakings (PSUs) mandate use of modules meeting domestic content requirement (DCR), i.e, modules made in India using domestically manufactured cells.
Black wafer, which is the base material for making a solar cell, is currently allowed to be imported since India barely has local manufacturing capacity. A black wafer becomes blue once it is diffused with a chemical for conversion of sunlight to electricity, and an anti-reflective coating is added to increase the efficiency of the solar cell. It is this process which the government wants to be made in India.
India has set a target of 280-300 gigawatts (GW) solar power capacity by 2030, creating a huge demand for solar components ranging from cells to ingots and wafers. Domestic manufacturing of solar panels and cells has picked up through various government interventions.
Backward integration of factories with production of ingots and wafers from polysilicon - an essential material for solar industry - remains negligible as the absence of tariffs and other import barriers is forcing companies to buy from China, which offers these products at a much lower price.
Industry stakeholders had demanded policy support from the government to boost domestic manufacturing of wafers and ingots, used in making solar cells, which are in turn used to make solar modules or panels. Currently, India has almost no manufacturing capacity of wafers and ingots and almost all of it is imported from China. There is only a 2 gigawatt (GW) capacity for wagers and ingots in India, which is owned by the Adani Group.
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