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Some solar power project developers are said to be buying cheaper and poor quality Chinese solar modules to meet cost and deadline pressures

New Delhi, September 08, 2017: In what may impact solar power generation, poor quality Chinese solar modules— rejected by developers—are being sold in the domestic market at a discount, said several people aware of the industry practice according to livemint.com.

With their project deadlines approaching, some Indian developers have taken recourse to this route to meet cost pressures and timelines. Modules account for nearly 60% of a solar power project’s total cost.

“These defects range from huge cracks (in solar panels) to low-efficiency equipment. The Chinese suppliers know that there is a pressing demand here and, hence, these tactics,” said a New Delhi-based chief executive of a firm, requesting anonymity, whose rejected modules were sold recently in India by its Chinese supplier.

With the average efficiency of a solar panel usually only 16-22%, any sub-standard quality will impact generation.

According to the reports published in livemint.com “While an A grade developer would reject them because of micro cracks and other defects, someone will buy them at a cheaper cost. This practice is believed to have increased recently,” said Gagan Vermani, founder and chief executive officer of MYSUN, a rooftop solar company and an online solar platform.

The centre, on its part, has come up with stringent quality norms for solar equipment to be sold in the country along with making the destruction of sub-standard equipment mandatory, The Economic Times reported on Friday.

“The sub-standard or defective goods which do not conform to the specified standard....shall be deformed beyond use and disposed of as scrap by the manufacturer or the representative of overseas manufacturer from liaison office or branch office located in India, or by any agency authorized by the manufacturer as its authorized representative in India,” according to a 30 August order of the ministry of new and renewable energy (MNRE) that will come into effect one year from the date of its publication in the official Gazette.

India is also conducting an anti-dumping investigation on solar equipment from China, Taiwan and Malaysia.

Major Chinese solar module manufacturers include Trina Solar Ltd, Jinko Solar, JA Solar Holdings, ET Solar, Chint Solar and GCL-Poly Energy Holdings Ltd.

Experts say that the quality of imported modules in India has always been suspect.

“There has long been a festering issue with quality of imported modules in India. In particular, the smaller and second-tier developers, under pressure to cut back on costs, are known to skimp on quality. The result is poor quality projects with lower than expected power output,” said Vinay Rustagi, managing director at solar energy researcher Bridge to India.

“But there are also some cases, where the modules get rejected, which are then scrapped or used in rooftop and off-grid applications. Exact numbers are hard to get but we believe that 20-30% of imported modules may be sub-standard,” added Rustagi.

livemint.com also quoted that queries emailed to Trina Solar, Jinko Solar, JA Solar Holdings, ET Solar, Chint Solar and GCL-Poly Energy on 30 September remained unanswered. Queries sent to an MNRE spokesperson also went unanswered.

Electricity distribution firms are aware of this malaise.

“This has been a concern all along. While I was promised a Capacity utilization factor (CUF) of 18% for our solar projects, it is not even 14-15%,” said the CEO of a power distribution company (discom) requesting anonymity.

Capacity utilization factor is a measure of how well a solar power plant is utilized and is the ratio of the actual electricity output from the plant to the maximum possible output during the year.

“Due to these quality concerns, we have become very particular about quality and specifications with anyone who wants to set up solar rooftop projects for net metering scheme as I don’t want my grid to interconnect with a lousy panel,” added the discom head.

India has set an ambitious clean energy target of 175GW by 2022. Of this, 100GW is to come from solar projects.

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