Indian solar module export prices to the US increase amid import regulations

India's solar module exports to the US have risen by approximately 3-4 cents/Wcompared to other destinations, largely due to a regulatory requirement imposed by the US importers, sources said July 1.

The price difference is linked to the US ban on solar cells sourced from China's Xinjiang region, the largest and most cost-effective cell producer in the world. Consequently, Indian manufacturers eyeing a foothold in the US market are compelled to procure cells from alternative, often less cost-effective, locations such as Indonesia, Thailand, and various Southeast Asian nations.

"Importing cells from countries outside of China significantly raises our import costs, which we inevitably pass on as higher export prices to the US," an India-based module manufacturer said.

This concern was underscored by a solar cell technology provider who noted that imports from Xinjiang were restricted due to allegations of forced labor, among others.

"All silicon production from Xinjiang is banned in the US due to these labor concerns, necessitating a traceability report for shipments entering the country," the provider added.

Currently, the US is the foremost destination for Indian solar module exports, accounting for over 80% of the total volume shipped outside of India. Canada, Bangladesh, the UAE, and some African countries follow.

In response to this burgeoning market, Platts, part of S&P Global Commodity Insights, commenced daily price assessments for Indian solar modules, effective July 1. These assessments encompass modules with outputs ranging from 520-680 W for PERC specifications and 570-720 W for TOPCon specifications, applicable for contract volumes between 5-50 MW.

Platts assessed the FOB India prices for TOPCon (570-720 W) and PERC (520-680 W) modules at 18 cents/W on July 1. While many Indian manufacturers transitioned to TOPCon technology due to its enhanced efficiency, market participants noted that price differentiation between the two technologies remained negligible.

During the week ended July 1, FOB India prices for TOPCon (570-720 W) and PERC (520-680 W) modules, exported to countries other than the US, were heard at 13-14 cents/W.

As domestic demand for solar modules in India continued to rise, several manufacturers prioritized local sales. As of March 31, India's total installed renewable energy capacity reached 220.10 GW, with solar energy contributing significantly by adding 23.83 GW in the fiscal year ending in March, bringing the total installed solar capacity to 105.65 GW. The Indian government has set an ambitious target of achieving 500 GW of non-fossil fuel-based capacity by 2030.

"Every year, the demand for solar modules in India grows by 7%-10%, prompting producers to focus on local markets," another manufacturer said. Despite this trend, many India-based producers still rely on imported cells from China to manufacture modules for domestic buyers, as local equipment costs remain high.

During the week ended July 1, a domestically traded solar TOPCon module with cells imported from China was heard at 16-17 cents/W, while the same using completely domestic content was heard at 28-29 cents/W.