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Indian Large Scale Solar Prices Remain Low Despite Rising Uncertainty Over Solar Panel Prices

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Solar Energy Prices Lowest in India

Stiff competition in India’s solar sector has kept a check on the prices of solar energy with the most recent tender in one of the largest solar parks showing a price of less than USD 4 cents/kWh. Though the prices were around 1% higher than the lowest ever price of INR 2.44 per unit witnessed last year, this was still low and raised questions of viability.

The largest risk facing solar developers is the price of solar panels which make up the biggest component of the overall system cost of solar energy. Most of the solar panels in India are imported from China and other places. This makes them highly susceptible to risk over increases as the Indian government is thinking of putting anti-dumping or safeguard duties on imports to protect the large Indian domestic industry which faces a serious crisis due to low priced imports. Besides anti-dumping duty, the government of India has also started a case on safeguard duties on imports of solar cells and panels and a preliminary finding has recommended a 70% duty.

Solar India

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Large Indian developers most of which are foreign-backed have put in aggressive bids in the tender with prices of less than INR 2.5/kWh. These prices do not leave much on the table in terms of safety margins and even a slight price increase in the project could lead to non-viability. However, with the drying up of solar tenders in the last 6 months, large project teams of these developers were sitting idle and perhaps they had little option but to put in aggressive bids in order to win. Renew, Softbank, Azure Power and Hero were the big winners of the solar park tender. Out of the 4 winning bidders, 3 are foreign owned or backed by international institutions.

The government plans to come up with more than 17 GW of tenders over the next few months which is massive considering that the cumulative capacity of solar energy in India is around 17 GW. There is much skepticism about the ability of the government to bring in such a large quantum of solar tenders in such a short time especially given that the power sector is sitting on a surplus as of now.


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

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