“The impositions of basic customs duty on a rooftop solar system and solar cells will lead to an increase in solar tariffs on account of a rise in the overall project cost” – said India Ratings and Research company.
The Government has decided to levy 40% basic customs duty on solar modules and 25% on solar cells coming into effect from 1st April 2022. This decision would make the imports of the cells costlier, encouraging local manufacturing.
When was this decision taken?
During the last economy budget session, the Government decided to levy a heavy duty of 40% on modules and 25% on rooftop solar for homes which will be running into the system from 1st April 2022. The Government said a year is sufficient to let all the dealers and developers secure the required raw materials in time.
Why this decision?
With the Make In India initiative, the Government is trying to increase the production of all the required energies at home itself. It wouldn’t be possible to have all the things required before starting the manufacturing unit if the imports were supposed to be stopped all of a sudden. This shift in the module will help increase the home production of rooftop solar for home and solar plants.
What is India expecting out of this move?
The Atmanirbhar Bharat has scaled up the country towards increasing domestic manufacturing. As there would be an increase in production, it would make India export the solar cell models to other countries while providing an alternative avenue for procuring rooftop solar systems and modules.
How is India visualizing the route in Solar Modules after 2022?
Right now, India is running the largest program of clean energy to achieve 175 GW renewable capacities. It is also aiming to make 100 GW of solar power by 2022. The country’s power requirement would be 817 GW according to the Central Electricity Authority, out of which half ofit would be clean energy and 280 GW would be from solar energy. To achieve this number, the country has to install at least 25 GW of solar energy capacity every year till 2030.
Would this decision impact the prices of solar energy?
The decision was taken to increase the domestic manufacturing unit of rooftop solar systems and solar plants. This would generally increase the pricing of the module but for a greater outcome.
The clean energy and renewable energy drive is really a long way to go. With such measures and duties, India will soon be the country to make solar energy have a greater impact on the country and around the globe.
