India Solar Market Update – Q3 2017

Executive Summary

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India Solar Demand Forecast

• Total solar installations in Q3 2017 came to 2,247 MW,

which were up 300 MW compared to Q2 when 1,947 MW

were installed. In the first nine months of 2017 over 7.1 GW

of solar installations were added.

• Mercom is forecasting calendar year (CY) 2017 solar

installations in the range of 9.5 to 10 GW.

• The pipeline of utility-scale projects is currently at about 11.5

GW and another 5.6 GW of tenders are pending auction.

• A total of 1,456 MW of solar were tendered and 1,232 MW of

solar were auctioned in Q3 2017, down from Q2 2017 when

3,408 MW of solar were tendered and 2,505 MW of solar

were auctioned.

• The lowest bid quoted in Q3 2017 was ₹2.65

(~$0.0408)/kWh in the recently held Gujarat Urja Vikas

Nigam Limited (GUVNL) 500 MW solar auction.

• Renewables comprise almost 19 percent of India's total

installed capacity with solar accounting for over 5 percent.

Among renewables, solar accounts for over 27 percent of

the installed capacity.

• Cumulative solar rooftop installations in India totaled 1,345

MW at the end of Q3 2017

0

20,000

40,000

60,000

0

4,000

8,000

12,000

2009 2010 2011 2012 2013 2014 2015 2016 2017F 2018F 2019F 2020F 2021F

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Annual Rooftop Solar Installations (MW)

Annual Utility-scale Solar Installations (MW)

Cumulative Solar Installations (MW)

Source: Mercom India Research (Sep 2017)

India Solar Demand Forecast (MW)

www.mercomindia.com

All India Cumulative Utility-Scale Solar Installations by Policy Type

0

500

1,000

1,500

2,000

2,500

All India Cumulative Utility-scale Solar Installations By Policy Type (MW)

Cumulative Large-Scale Solar Installations ~15.7 GW

Source: Mercom Capital Group (Dec 2016) Source: Mercom India Research (Sep 2017)

www.mercomindia.com

Quarterly Solar Installations in 2017

0

500

1,000

1,500

2,000

2,500

3,000

3,500

Q1'17 Q2'17 Q3'17

Rooftop Solar

Utility-Scale

Solar Installation in 2017 by Quarter (MW)

Source: Mercom India Research (Sep 2017)

2,955

1,947

2,247

• Total solar installations in Q3 2017 totaled 2,247 MW, up

300 MW compared to Q2, when 1,947 MW were installed.

In the first nine months of 2017 over 7.1 GW of solar

installations were added.

• Utility-scale solar installations quarter-over-quarter were up

by almost 15 percent.

• Installed rooftop solar in the third quarter was up by

approximately 18 percent compared to the second quarter

of 2017.

• The first quarter of 2017 was the strongest in terms of total

installed capacity, largely due to few projects that were

slated to be commissioned in 2016 but were connected in

Q1 2017.

Click here for the list of projects announced and commissioned in

the third quarter of 2017

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Policy Updates

Policy Updates:

Over 4.1 GW of solar projects have been commissioned under various phases of the

Jawaharlal Nehru National Solar Mission (JNNSM) so far: Migration program (PV -

48 MW and CSP – 2.5 MW), Phase I Batch 1 (PV – 140 MW and CSP – 200 MW),

Phase I Batch 2 (PV – 330 MW), Phase II Batch 1 (PV – 680 MW), Phase II Batch 2

(PV – 1,780 MW), and other programs.

JNNSM - Phase II Batch 2 State Specific Bundling Program (NTPC)

The MNRE has specified 3,000 MW of PV projects under this program, implemented

by NTPC through open competitive bidding. These projects are spread across states

including Andhra Pradesh, Karnataka, Rajasthan, Telangana and Uttar Pradesh.

JNNSM - Phase II Batch 3 (SECI)

Solar Energy Corporation of India (SECI) has called for tenders amounting to 2,510

MW under JNNSM Phase II Batch 3 - State Specific VGF Program.

JNNSM - Phase II Batch 4 (SECI)

Under this program 5,000 MW of grid-connected solar PV projects on a build, own

and operate basis with VGF benefits are to be developed. Tenders for 3,650 MW

projects under this program have been issued, out of which 1,000 MW tenders were

cancelled by SECI.

JNNSM - Phase II Batch 5 (SECI – CPSU)

This batch aims to set up 1 GW of grid-connected solar PV power projects for

Central Public Sector Undertakings (CPSUs) and Government of India organizations

for either self-use or sale to third-parties or merchants.

0

6,000

12,000

18,000

In-Operation Under Development Tendered

India: Utility-Scale Solar Projects by Status (MW)

Source: Mercom India Research (Sep 2017)

www.mercomindia.com

Solar Tender and Auction Activity

0

1,000

2,000

3,000

4,000

Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017

India Solar Tenders and Auctions by Quarter (MW) Tenders Auctions

Source: Mercom India Research (Sep 2017)

www.mercomindia.com

Average Solar Module Price Trends in India

• Chinese solar module ASPs increased by 14 percent in Q3

compared to the second quarter of 2017.

• During the same period in 2016, Chinese module prices

actually dropped by 14 percent.

• Price quotes for Chinese modules in India ranged from $0.30

(~₹19.4)/W to $0.38 (~₹24.6)/W based on order size and other

parameters.

• Module prices in the third quarter were almost 20 percent more

than what developers had expected. This highlights a huge gap

between module price forecasts and the reality of rising prices.

• Although there was a rise in polysilicon and wafer prices in the

third quarter, heightened Chinese installation activity is the

primary underlying factor dictating module price trends.

0.30

0.40

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Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17

Indian Module ASP ($/W)

Chinese Modules ($/W)

Chinese and Indian Module ASPs Q3 2017

Source: Mercom India Research (Sep 2017)

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Bidding Trends in Reverse Auctions

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6.0

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Low Tariff (₹/kWh)

Source: Mercom India Research (Sep 2017)

Note: AP Phase II - The range of first-year tariff offered by the successful bidders was Rs.5.25-5.99/kWh with a 3% per annum escalation for the first 10 years, then flat thereafter. MP: Rewa Ultra Mega Solar project - low bid of Rs.2.97/kWh tariff escalating at Rs.0.05/kWh for 15 years. Levelized tariff comes to Rs. 3.30/kWh.

Lowest Solar Bids in Reverse Auctions in India (₹/kWh) Q3

2017

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Our quarterly report includes market share rankings

• Top Utility-scale Project Developers with Installed Capacity

• Top Utility-scale Project Developers with Under-development Pipeline

• Top Solar Inverter Suppliers in India

• Top Solar Rooftop Developers

• Top Solar Module Manufacturer in India

• Top Solar Cell Manufacturers in India

• Top Utility-scale EPC Players with Commissioned Capacity

• Top Utility-scale Third Party EPC Players with Commissioned Capacity

• Top Solar Module Suppliers in India

Complete Market Share Analysis and Rankings for Each Category Available in Our Full Report.

Some of the

market leaders:

Market Leaders

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State Policies

Updates: To facilitate the large-scale grid

integration of solar and wind power while

maintaining grid stability, the Andhra Pradesh

Electricity Regulatory Commission (APERC)

released new regulations for the forecasting,

scheduling, and deviation settlement of solar

and wind generation.

Updates: The Madhya Pradesh Electricity

Regulatory Commission (MPERC) has

proposed the application of scheduling and

merit order dispatch principles to energy

generation from co-generating and renewable

energy generating units from time to time,

implying that it wants to end the must-run

status of renewables.

Updates: The Jharkhand Renewable Energy

Development Agency (JREDA) issued a

tender to develop 1,200 MW of solar projects

in December 2015. In Q3 2017, JREDA

issued assurances that it would sign PPAs for

a total of 685 MW of solar projects out of the

1.1 GW for which LOIs were initially issued.

Updates: The HERC released a discussion

paper on HERC (Terms and Conditions for

the Determination of Tariff from Renewable

Energy Sources, Renewable Purchase

Obligation (RPO), and Renewable Energy

Certificate (REC)) Regulations 2017. In the

draft, the HERC determined the useful life of

25 years for a solar project.

Andhra Pradesh

Madhya Pradesh

Jharkhand

Haryana

Complete state by state updates are covered in our full report

State Ranking Based on Total Installed Utility-Scale Solar as of Sep 2017

The top three states which, now have over 2 GW of installed solar capacity, represent approximately 43 percent of the total installed capacity in the country

1

Total Installations - 2,479 MW Total Installations - 2,195 MW Total Installations - 2,089 MW Total Installations - 1,797 MW Total Installations - 1,648 MW

Total Installations - 1,291 MW Total Installations - 1,273 MW Total Installations - 792 MW Total Installations - 753 MW Total Installations - 618 MW

Top 10 Solar States in India

Telangana Andhra Pradesh Rajasthan

Data from Mercom's India Solar Project Tracker

Tamil Nadu

Gujarat Madhya Pradeh Punjab Maharashtra Uttar Pradesh

Karnataka1 2 3 4 5

6 7 8 9

15.7 GWCumulative Solar Capacity

2 GWSolar Installations Q3 2017

11

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India Solar Market Update – Q3 2017

Mercom India’s India Solar Market Update provides you with the most comprehensive report on the Indian solar sector. The report, a first-of-its-kind, delivers high-quality research and analysis, facts and figures, and forecasts for global solar professionals. Primary data for the report is directly collected from government agencies, developers, investors, manufacturers, installers and other industry stakeholders. The report offers details on prevailing market conditions, issues and challenges, opportunities, and the outlook for India’s solar industry.

Who Needs to Purchase this Report? • Project Developers • Component Manufacturers • Utility/IPPs

• EPC Provider • BOS Suppliers • Investment Firms/Funds

• Investors, Banks and Financial Institutions • Installers • Foreign Entrants

The report includes: • Quarterly and YTD Installations • Forecasts • Updates on Tenders and Auctions • Policy Updates and Analysis • State-by-State Installations and

Module Prices • Tariffs • Project Costs • Imports/Export Activity • Solar Power Generation • Market Share and Rankings • Quarterly Survey of Solar Supply

Chain • Other Important Updates

Click here for more information or to purchase a copy of India Solar Market Update – Q3 2017

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