First Solar in India
First Solar (NASDAQ: FSLR) just announced deals for the sale of 50 megawatts of its cadmium telluride (CdTe) thin-film modules to Indian developers Kiran Energy Solar Power Pvt. Ltd. and Mahindra Solar One Pvt. Ltd. for side-by-side 20-megawatt and 30-megawatt projects in the state of Rajasthan.
First Solar’s India strategy “includes establishing a deep local presence,” CEO James Hughes recently said. India is “a very real opportunity.” The company’s impressive average module manufacturing cost of $0.70 to $0.72 per watt, its 12.7 percent efficient modules, and its proven bankability, Hughes believes, are competitive advantages in India.
India’s Jawaharlal Nehru National Solar Mission (JNNSM), aimed at the addition of 20,000 megawatts of solar capacity by 2022 through a renewable auction mechanism, closed this year. In addition, several Indian states, notably Gujurat, have solar feed-in tariff programs.
With an energy deficit and infrastructure that led to the world’s worst blackout, India’s turn to solar caused a stampede of capacity building by Indian module manufacturers and a stampede to India by international solar manufacturers, builders and financiers seeking a piece of the action.
“There is roughly 1050 megawatts of cumulative capacity now installed in India,” explained GTM Solar Market Analyst Scott Burger. “Of that, roughly 670 megawatts came from the Gujarat policy and the remaining portion from the National Solar Mission and then a mix of other, smaller policies.”
Burger identified First Solar activity in India that included JNNSM deals with Fonroche Energie Group (twenty megawatts), NVR Infrastructure (two megawatts), Azure Power (35 megawatts), and Green Infra (25 megawatts). The two newest projects fall under the JNNSM. 2011 deals with Reliance Power (NSE:RPOWER) (100 megawatts) and ACME Tele Power Ltd (fifteen megawatts) fall under Gujarat’s feed-in tariff policy.
India solar experts point out a market distortion that favors First Solar.
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