BHEL to start end-to-end solar equipment manufacturing, seeks consultants

BHEL’s green energy portfolio includes close to 1.2 GW of ground mounted, rooftop, canal top and floating solar PV plants across the country
State-owned BHEL Limited plans to make complete solar equipment in India, encouraged by the government’s plan to push local manufacturing through incentives under the Atmanirbhar Bharat scheme.

The company plans to have a complete value chain: from raw material quartz (polysilicone) to wafers and then finished products like cells and modules.

BHEL recently came out with a tender to hire consultants for preparing the ‘detailed project report (DPR)’ for its solar manufacturing plans.

“To support the Aatmnirbhar Bharat campaign of the government, solar PV value chain holds substantial indigenisation potential especially in upstream. There is no domestic polysilicon and wafer manufacturing capacity and minimal cell and module manufacturing capacity. Against this background, BHEL is exploring opportunities in manufacturing of solar PV value chain,” said the company in a tender notice for hiring consultants.

It said the move was in line with the company’s aspirations of identification and diversification into emerging technology areas for growth and sustainability and simultaneously increasing the share of non-coal business.

BHEL in the investor presentation for Q3FY21said the company’s solar business has been restructured by converting it into a profit center as ‘Solar Business Division’ under its diversification plans. “The SBD will be responsible for complete solar business value chain, including order booking, manufacturing and execution. This is likely to improve cost competitiveness and execution performance,” it said. The SBD is based in Bengaluru for marketing, engineering, manufacturing and project management in the solar segment. BHEL also has a centre of excellence in Gurugram working on indigenous solar PV technology.

BHEL’s green energy portfolio includes close to 1.2 GW of ground mounted, rooftop, canal top and floating solar PV plants across the country.

In its annual report for 2019-20, BHEL said the diversification initiatives led to the highest ever order booking in the industry segment, including highest ever orders in transmission, solar and defence & aerospace in 2019-20. BHEL already produces space grade solar used in satellites launched by Indian space agency ISRO.

BHEL has been looking to expand in newer areas as it faces demand slowdown from its core customer – thermal power sector. For the third quarter ending December 2020, the revenue from the power segment was down by 36 per cent over corresponding last fiscal. The profits from the segment were also down by 278 per cent year on year to Rs 114 crore in the same period.

The company’s industry segment, which includes new businesses like solar equipment manufacturing, suffered a revenue decline of 13 per cent and a loss of Rs 119 crore in the Q3FY21.

There is currently no end-to-end solar value chain manufacturer in the country. There are private existing solar cells and module makers like Adani Solar, Vikram Solar and Waaree Energy. Among state-owned companies, mining major Coal India plans to set up solar manufacturing. It also plans to have an end-to-end solar manufacturing for wafers, cells and modules.

India awarded its first solar manufacturing tender last year. Under this, Adani Green and Azure Power will construct solar cells and module manufacturing of 2 GW and 1 GW respectively. India has set an ambitious target of 175 GW of renewable energy capacity by 2022. This includes 100 GW from solar and 60 GW from wind energy.

Solar power projects in India are dependent on imported solar panels. Close to 75 per cent of India’s solar power capacity is built on Chinese solar cells and modules. India’s solar cell (component of a solar panel) manufacturing capacity stands at 3 GW and of module (finished product) is 5 GW, while the country’s solar power generation capacity stands at 34.7 GW.


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