ALMM To Rule Solar From April 1, 2024 in India

Highlights :

  • India’s favourite non tariff barrier will be back in full force from April 1, 2024.
ALMM To Rule Solar From April 1, 2024 in India

Putting to rest any doubts over the future of sourcing for key solar projects, the Ministry of New and Renewable Energy (MNRE) has confirmed the deadline of March 31 for ending all ALMM related exemptions for developers in a terse, one page office memorandum. At SaurEnergy, we had predicted this outcome early this week.

That means, from April 1, developers, including those involved with open access projects and even unsubsidised rooftop projects, will need to use domestic modules listed in the ALMM list. The only exemption, on a case to case basis, will be for projects where modules have been received at the project side on or before March 31.

This final notification for the financial year puts at rest perhaps the most contentious issue the government has had to deal with when it comes to the solar sector. The big decision to make was the call between domestic manufacturers and developers, with the latter insisting that domestic capacity was not enough to meet requirements. India has a 90 GW plus pipeline of approved and planned projects as on date.

But with developers taking full advantage of the exemption provided last year, to import modules till March this year, the government has finally decided that existing inventory at hand, and upcoming capacity additions in the country will be enough to serve domestic demand. Fresh capacity additions coming up include those from Reliance New Energy, besides a slew of other manufacturers, especially in Gujarat.

With this final note, the government has gone well beyond the last ALMM conditions, by adding even Open Access projects and household rooftop projects without subsidies to the list of projects that will need to comply with ALMM/DCR requirements. In doing this, it has pretty much negated its February notification, that was subsequently withdrawn, completely.

After 3 years of jockeying, it does seem that this battle has finally been settled in favour of domestic manufacturers.  For how long, no one really knows, as we have seen in the past two years.

Consequences will mean a sharp fall in imports from China, besides a tougher enforcement regime to verify the origins of cells used in module manufacturing. Cell manufacturing has lagged sharply behind module manufacturing in India, and experts are still skeptical about India being well covered on that aspect of the supply chain for some time to come.

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Prasanna Singh

Prasanna has been a media professional for over 20 years. He is the Group Editor of Saur Energy International