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Indian State Company BHEL Opens A Super Small Useless Solar Cell And Module Factory

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Another small Solar Cell And Module Factory in India

Indian solar manufacturing has been in a woeful state thanks to the fragmented nature of its capacity with almost a hundred companies owning a combined 5000 MW of capacity. Compare this with global giants like Trina Solar and Jinko Solar which alone have a capacity of 5000 MW. This small scale capacity makes most of the Indian companies unable to compete as they are not economically viable. They do not have the scale in marketing or manufacturing which would allow them to amortize costs over a larger revenue base. The solar cell and panel production industry is a heavily competitive one with even the largest solar companies making wafer thin margins. You need to be absolutely cost efficienct in all your operations in order to compete.

Solar facory

A Solar Factory In India

To add to the existing non-competitive capacity, state owned company BHEL has also opened another useless small factory with 200 MW module and 105 MW cell capacity. These capacities are simply not economically viable and make little sense. The company had as far back as 2014 announced plans to open an integrated 500 MW line, but instead it has opened a tiny little factory in Bangalore. The state run companies in India have little strategic or operational sense. They are run by managers who have little accountability towards shareholders and stay in office at the whims of their political masters. Except for monopolies, most of the Indian government companies are loss making. They are huge destroyers of value and waste massive amounts of money which could be better used to alleviate poverty.

You might also like Coal India wants to build 1000 MW Solar Power Plants but why?

BHEL is primarily a maker of equipment for coal run thermal power plants and has been facing a tough time due to thermal power overcapacity in the country. This state run behemoth faces a bleak future with solar energy expected to overtake coal energy soon. Opening a tiny factory is not going to help BHEL be a material player in this space. There are already tens of factories of similar capacity and technology running in the country. Why add another one to the glut. If it wanted to create something of value it should have built a reasonably economically viable factory. Adani has built a 1000 MW plus cell and module factory and even that is in trouble due to lower end product prices.

Also read India Does Not Need Any New Coal Power Over Next 5 Years

PG

Sneha Shah

I am Sneha, the Editor-in-chief for the Blog. We would be glad to receive suggestions, inputs & comments on GWI from you guys to keep it going! You can contact me for consultancy/trade inquires by writing an email to greensneha@yahoo.in

4 Responses so far | Have Your Say!

  1. Venkatesan Subramanian

    GWI Makes a vital role to contribute the role of responsibility towards the global warming of the world but I request to give more opportunity for the nanotechnology student in India to contribute the salute towards your role & responsibility for GWI.

  2. Chandra mouli iyer

    I like the directness of this article. If I can quantify, I have to say that you are 100% correct.

  3. vasu

    Having minimal knowledge with the business trends you cannot comment as your wish and all giants it self went into losses in solar and future trend no body knows what can happen in the immediate next year itself due to market volatility some industries are strategically moving forward.

  4. Sneha Shah

    Sure Sir! Thank you for the encouragement! Please write to me on greenworldinvestor@gmail.com