India’s solar self-reliance: Avaada targets full domestic production of solar components
India’s solar module production assembles cells from polysilicon, processed into ingots and wafers. Despite growth in modules and cells, India still lacks major wafer, ingot, and polysilicon producers, keeping the supply chain reliant on China.
New Delhi: Avaada Electro, the solar module manufacturing arm of the Avaada Group, plans to start manufacturing the entire chain of solar components and equipment domestically, starting in FY28, as India focuses on local production to reduce dependence on imports, chairman Vineet Mittal said in an interview.
Currently, the company produces about 8.5 GW of solar modules annually and it is developing 6 GW of solar cell manufacturing capacity. Going ahead, the company plans to start making sub-components such as wafers, ingots and polysilicon.
"Avaada wants to play the full value chain energy security solution. Our vision is that we will convert sand into glass, then we will convert polysilicon into ingot, ingot into wafer, wafer into cell and cell into module, as part of the sand-to-molecule philosophy," Mittal said.
Avaada competes against local companies including the Adani Group, ReNew Energy Global, Reliance Industries and Waaree Energies, which operate or plan to enter the solar component manufacturing ecosystem. India currently has over 100 GW of solar module manufacturing capacity and cell capacity of over 25 GW, while domestic wafer and ingot manufacturing capacity is just about 2 GW.
Solar modules are manufactured by assembling cells. The process relies on polysilicon, which is shaped into ingots and sliced into wafers, onto which the solar cell layers and electrical contacts are built.
The supply chain is currently dominated by China. While India has developed its module-manufacturing capacity in the past few years and cell facilities are growing, there are no major producers of wafers, ingots and polysilicon in the country so far, continuing the reliance on China.
Avaada’s expansion plans come when the government has announced plans to mandate the use of locally manufactured wafers. Last month, the union ministry of new and renewable energy proposed to include solar wafers in the Approved List of Models and Manufacturers (ALMM) starting June 2028.
ALMM mandate
This requires utility-scale and government-backed projects to use only wafers enlisted in the ALMM. Such a mandate was first implemented for modules and is set to be implemented for solar cells starting in June next year.
Mittal noted that engineering of technologies for ingot and wafer manufacturing is complete and construction will start next year, while its 6 GW cell manufacturing capacity will be ready next year.
"After April 2027, we will also use DCR (domestic content requirement) ingot and wafers," he said, referring to plans to produce wafers and ingots with locally manufactured components.
He added that although not all its products would be DCR-compliant by the given timeline, its presence across the ecosystem would be established during the period. DCR norms refer to regulations mandating products to be manufactured with components produced within India, rather than with imported components.
As Avaada has already forayed into retails sales of its modules, the company now plans to retail modules for rooftop space. Under the government's flagship PM-Suryaghar Yojana, developers need to use domestically produced modules, those listed in ALMM.
"We have started appointing franchisees in the DCR rooftop space. We will start selling modules in retail for rooftop starting next year. And we will eventually sell in retail," Mittal said.
Last month, Avaada Electro’s facilities at Butibori in Nagpur in Maharashtra and Dadri in Uttar Pradesh received approval under ALMM, taking the company's combined ALMM enlisted capacity to over 5.4 GW.
Adani, Reliance
Currently, Adani Solar is the only company present across the ingot-to-module ecosystem. In April this year, Reliance Industries said its first line of 10 GW of solar module manufacturing capacity has been commissioned.
The company is developing giga factories on a 5,000-acre site at Jamnagar in Gujarat to produce photovoltaic (PV) modules, batteries, hydrogen electrolysers and fuel cells. It is expected to start solar cell production by the third quarter of the ongoing fiscal.
In May, Nasdaq-listed ReNew Energy Global received $100 million from British International Investment to expand its solar manufacturing business in India.
The Avaada Group has begun preparations for a ₹4,000-5,000 crore initial public offering of Avaada Electro, Bloomberg reported in May. Mittal did not comment on the IPO plans and said the company has adequate capital currently for its future plans. In 2023, the group raised $1.3 billion from Brookfield’s Energy Transition Fund and Thailand’s GPSC, a subsidiary of the PTT Group.
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