Mercom may lower India solar power installation forecast if duties are imposed.

KOLKATA: Mercom Capital Group, a global clean energy communications and consulting firm, said it may lower its India solar energy installation forecast of 1,000 MW in 2014 if import duties on components are imposed, while cautiously reiterating the estimate.

There hasn't been much activity in the solar energy industry over the past few months with elections underway. But there is anticipation that the incoming Bharatiya Janata Party (BJP) government will introduce measures to boost the industry.

Solar installations so far this year total 444 MW. However, the ministry of trade and commerce has resuscitated the seemingly dead anti-dumping case related to the import of parts.

Mercom's stance on the anti-dumping case is that it is bad policy. The department of commerce has revived the case and concluded preliminary findings into allegations that domestic manufacturers have been injured by the dumping of solar cells and modules by manufacturers in China, the US, Malaysia, and Taiwan, Mercom said in a statement.

The commerce department has continued to pursue the case while the ministry of new and renewable energy (MNRE) holds that imposing anti-dumping duties will be damaging to the sector.

"For a sector that hasn't grown a lot since 2012, the imposition of an anti-dumping duty will be detrimental, increase uncertainty and raise solar power prices.

"Moreover, anti-dumping duties will hurt local manufacturing as higher component costs will make project economics unworkable, freezing project development activity," said Raj Prabhu, CEO and co-founder of Mercom Capital Group.

Several manufacturers that initially supported anti-dumping investigations have told Mercom they are now opposed to such duties. They feel this may choke project development by increasing costs while the industry is still trying to find its legs. They now contend that they would all benefit from a larger market.

The local solar industry hopes that the new Narendra Modi-led administration will put an end to the unpredictability and bring some badly needed order to the energy sector.

Source : economictimes.indiatimes.com