Average development cost of large-scale solar projects up 21.6% YoY in Q4 2021

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The average cost of utility-scale solar projects in Q4 2021 (Q4 2021) was around ₹43 million (~$566,008)/MW, according to the recently released Q4 2021 and Indian Solar Market Annual Update by Mercom.

Average cost increased by 21.6% compared to the same period last year when it was ₹35.3 million (~$488,255)/MW and an increase of 1% compared to the previous quarter, where the cost was around ₹4.24 million (~$559,828)/MW.

The report attributes the rise in average project costs in 2021 to higher goods and services tax (GST) and component prices triggered by supply chain disruptions. Project costs are expected to increase further with the entry into force of the BCD in April 2022.

Project costs ranged between ₹4.03 Cr (~$0.508 million)/MW to ₹4.39 Cr (~$0.576 million)/MW, depending on the type of module used.

China’s polycrystalline module ASPs in 2021 saw the highest rise in recent history, growing 35% year-on-year.

According to the report, the average selling price (ASP) of polycrystalline modules from China increased by 10% compared to the previous quarter. On the other hand, the ASP of Chinese mono PERC modules increased by 1% compared to Q3.

Chinese module prices have risen for seven consecutive quarters, a trend not seen in the past ten years. Module prices had only trended upward in just two quarters before the pandemic in the past five years. Solar module makers also expect Chinese module prices to remain high until the first quarter of 2022.

Prices for Indian modules have also increased. The ASP of Indian polycrystalline modules increased by 3% and the ASP of Indian mono PERC module increased by 1% compared to the previous quarter.

The report notes that the increase in ASP modules resulted from higher prices for freight, polysilicon, EVA, backsheets, aluminum frames and solar glass.

According to the report, India added 10 GW of solar capacity in calendar year (CY) 2021, a 210% year-on-year (YoY) increase from 3.2 GW installed in CY 2020. Utility-scale solar projects accounted for 83% of installations with 8.3 GW and recorded a 230% year-on-year increase in the year 2021.

Mercom’s India Solar Q4 & Annual 2021 report covers all facets of the Indian solar market. For the full report, visit: https://mercomindia.com/product/q4-2021-india-solar-market-update


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