Cabinet approves PLI scheme for solar PV modules

MNRE proposed to implement the PLI Scheme for achieving manufacturing capacity of Giga Watt scale in high-efficiency solar PV modules.

The Cabinet, chaired by Prime Minister Narendra Modi, has approved the Ministry of New & Renewable Energy’s (MNRE) proposal for the implementation of the Production Linked Incentive (PLI) Scheme ‘National Programme on High-Efficiency Solar PV Modules’ for achieving manufacturing capacity of Giga Watt (GW) scale in high-efficiency solar PV modules with an outlay of ₹4,500 crores.

Solar capacity addition presently depends largely upon imported solar PV cells and modules as the domestic manufacturing industry has limited operational capacities of solar PV cells and modules. The National Programme on High-Efficiency Solar PV Modules will reduce import dependence in a strategic sector like electricity. It will also support the Atmanirbhar Bharat initiative.

Solar PV manufacturers will be selected through a transparent competitive bidding process. PLI will be disbursed for five years post commissioning of solar PV manufacturing plants, on sales of high-efficiency solar PV modules. Manufacturers will be rewarded for higher efficiencies of solar PV modules and also for sourcing their material from the domestic market. Thus, the PLI amount will increase with increased module efficiency and increased local value addition.

The outcomes and benefits expected from the scheme include: additional 10,000 MW capacity of integrated solar PV manufacturing plants; direct investment of around ₹17,200 crores in solar PV manufacturing projects; demand of ₹17,500 crores over five years for ‘Balance of Materials’; direct employment of about 30,000 and Indirect employment of about 1,20,000 persons, import substitution of around ₹17,500 crores every year, and impetus to Research & Development to achieve higher efficiency in solar PV modules.

The MNRE has already decided to impose a basic customs duty of 40 per cent on imported solar modules and for imported solar cells it would be 25 percent, starting April 1, 2022. This is expected to boost the domestic manufacturing of solar cells and PV modules.     

Source; PIB