ALMM Requirement For Solar Projects Deferred To April 2024

In a move that was as unexpected as seemingly inevitable, the MNRE(Ministry of New and Renewable Energy), in a late evening Office Memorandum, has declared that its orders for using only domestically approved modules in the Approved list of module manufacturers list (ALMM) will be held in abeyance till March 31, 2024. The ALMM order had been expanded to cover all government supported solar projects, a definition that covered virtually all major projects across the country.

The order or memorandum, uploaded on MNRE website late evening today, effectively opens up the market to imports again, for use in projects across the board, especially larger utility scale projects. Developers had been pushing for such an exemption for some time now, claiming inadequate supply of competitive and quality modules locally. The BCD of 40% will of course remain to contend with.

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The move is likely to be met with denunciations from many domestic manufacturers, while developers will welcome it, although we have seen how the issue of BCD too has become a sore point for many. However, it is instructive that many developers seem to have got their BCD planning wrong too, if one goes by a recent case at the CERC. It remains to be seen if these developers will now welcome the order wholeheartedly or still plead for grandfathering of older projects.

With domestic capacity for high quality modules expected to nudge 45 GW by 2024, it seems safe to say that in the many about turns we have seen on the issue, this is possibly the largest major extension for developers who are finishing projects before the new deadline. The only issue that remains possibly is whether some foreign manufacturers will manage to get into the ALMM list itself, of course.

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