Norway’s Scatec – which has a 50% stake in Acme’s 900 MW solar project in Rajasthan, India – has put the planned installation on hold due to a lack of domestically produced solar panels and a 40% import duty on PV modules that will go into effect from April.

From pv magazine India

Norway’s Scatec and Indian developer Acme Solar have decided to put their 900 MW solar project in the Indian state of Rajasthan on hold.

Scatec pointed a lack of domestically made solar panels and a 40% import duty on PV modules from April as the reasons for putting the project on hold. The project has been moved from backlog to pipeline, the developer said, adding it still sees India as a robust market.

Scatec has a 50% stake in the Rajasthan solar project, which is being developed by Acme. The project was scheduled for commissioning in 2022. It will benefit from a 25-year power purchase agreement (PPA) with Solar Energy Corp. of India.

Scatec stated the main reason for putting the Rajasthan project back in the pipeline was “the realization or confirmation that the import duty was not going to be lifted for some of the projects in that [it’s 900 MW project] category … There will be a change in the market in terms of where are the modules being sourced from, China or all the production being built up in India. We are a bit uncertain how quickly that is moving. That’s why we have decided to take this large project into the pipeline from the backlog.”

It also pointed to a “gap in between the price level that we have seen in modules from China and the expected price level” for panels made in India.

“We expect that over time, production lines for modules in India will approach the same cost level as in China,” it added. “But that needs to be confirmed. Without knowing that, we have decided to move the project from backlog to pipeline.”

Scatec said last year that the 900 MW solar project has an estimated total capex of $400 million, with 75% debt financing from an Indian state-owned lender. Scatec holds a 50% stake in the project, with Acme holding the other half.