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Solar Cell Imports to Halve as Domestic Supply Surges
18 Jun
Summary
- Domestic solar cells will meet half of 60-65 GW demand this fiscal.
- Import dependence to fall materially starting next fiscal.
- New solar capacity could extend payback periods by 1-2 years.
Domestic solar cell production is poised to satisfy roughly half of the anticipated 60-65 GW demand for the current financial year. This represents a substantial increase from previous years, signaling a reduced dependence on imports. The growth in domestic supply is attributed to government efforts to bolster local manufacturing capabilities.
While imports will still fulfill a portion of the demand, particularly for projects with bids submitted before August 31, 2025, their role is expected to diminish significantly from the next fiscal year onwards. This reduction is contingent on the phasing out of earlier project pipelines.
The surge in domestic solar cell manufacturing capacity, however, introduces economic considerations. Manufacturers are advised that newly commissioned capacities by the end of this fiscal year may experience extended payback periods, estimated at 1-2 years longer than those of early market entrants.
This could impact the profitability and investment returns for solar projects, especially given the rapid technological evolution in the sector. Deeper backward integration into ingot and wafer manufacturing may offer better returns for producers aiming for higher realisations.
