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US silicon wafer maker 1366 Technologies and First Solar are among 15 companies that are considering total investments of around $3 billion to build solar equipment manufacturing facilities capitalizing on the Indian government’s initiative to push local manufacturing.

A government official aware of the development that these companies have communicated to the government on their plans to manufacture a total of 10 gigawatt (GW) of wafer, and 20GW each of solar cells and modules. The other major companies who have shown interest include Acme Solar, Vikram Solar, ReNew Power and Adani Solar, the official said, requesting anonymity.

These initiatives follow the Indian government announcing a production-led incentive (PLI) scheme that offers manufacturers in 10 sectors, including those of high-efficiency solar modules, total benefits of 1.97 trillion. Separately, the government also articulated its plans to impose a basic customs duty of 40% on modules and 25% on solar cells imports from 1 April 2022. The government also plans to build three large manufacturing zones in a coastal state, a hill state and a land-locked state for power and renewable energy equipment by offering incentives to the manufacturers.

“All the companies which have expressed intent to manufacture in solar, are expected to create a manufacturing capacity of 20GW module, 20GW cell and 10GW wafer in India," the official cited above said.

Wafers and ingots—building blocks for manufacturing solar cells and modules—are key to India’s ambitious clean energy plans. India plans to encourage self-reliance and reduce dependence on Chinese equipment. Globally, the manufacturing of solar wafers and ingots is dominated by China, but India does not have any such capacity so far. India has a domestic manufacturing capacity of 2GW for solar cells and 10GW for modules.

“Incidentally, when we announced that we are going to impose customs duty, we have got expressions of interest or letters of intent for manufacturing of almost 20GW of cells and modules," power and new renewable energy minister Raj Kumar Singh told Mint in an interview.

Prime Minister Narendra Modi has said India will not be able to fully use its solar power potential unless it develops better solar panel, battery and storage manufacturing capacity.

“I can confirm that we are actively exploring opportunities to build a wafer and cell manufacturing plant in India," said a 1366 Technologies spokesperson in an emailed response. Queries emailed to a spokesperson for First Solar late Tuesday night remained unanswered till press time.

While Vikram Solar is planning to reach a 5GW capacity over the next three years, Acme Solar is interested to build a 1.5GW solar module manufacturing capacity. ReNew Power plans to set up a 2GW solar cell and module manufacturing facility in India and Adani Solar, which has a 1.5GW solar cell and modules manufacturing capacity, is building another 2GW capacity.

“Vikram Solar presently has 1.2GW of solar module capacity. We are expanding our capacity in Tamil Nadu by building about 3GW of manufacturing plant, consisting of solar modules, solar cells and solar wafer, the entire value chain," said Saibaba Vutukuri, CEO of Vikram Solar, in an emailed response. “Overall, we are planning a total capacity expansion to 5GW in the next three years".

“ReNew Power’s plan to set up a 2GW manufacturing facility for solar modules as well as solar cells is very much on track. We are in advanced negotiations with a few shortlisted states to set up the facility, and hope to conclude the discussions soon," said Sumant Sinha, CMD, ReNew Power in an emailed response.

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