ALMM with Short Term Drawbacks And Long Term Benefits

To reduce India’s reliance on solar imports and achieve self-sufficiency, the Ministry of New and Renewable Energy (MNRE) announced mandatory registration of solar module manufacturers under the Approved List of Models and Manufacturers (ALMM) and published a list of eligible models and manufacturers of solar cells and modules as of March 2021.

In this blog, we will learn about ALMM as well as how it has affected the Indian solar industry after its implementation.

Now, the first question is what is ALMM?

ALMM stands for Approved List of Models and Manufacturers (ALMM). This is a list of eligible models and manufacturers of Indian solar cells and modules complying with the BIS (Bureau of Indian Standards) certification. Ministry of New and Renewable Energy (MNRE) initiated this concept in September 2020.

After knowing the basic information of ALMM, the second most important thing is, What’s the purpose of it.

The idea behind introducing the Approved List of Models and Manufacturers (ALMM) was to secure the interest of Indian Solar Cell & Module Manufacturers. It aims to have a quality benchmark for modules and prevent low-quality Chinese manufacturers from dumping their products in India. Only those modules and manufacturers, who are included in this list, shall be eligible for use in projects under Government schemes & Programmes, installed in the country. Hence it will be very helpful to build consumer trust in domestic products & encourage them to buy these.

Whatever the tender has been released over the last six months by SECI, ALMM is the priority.

Solar Projects for Reference:

United States Solar Firm Plans To Invest $ 300 Million In India

SECI Has Invited the Bids For 100 MW Solar Project in Chhattisgarh

Market Reviews For ALMM:

Good Side of ALMM:

Some stakeholders believe that deploying ALMM would be beneficial to the solar business. They hoped that this would improve the quality of photovoltaic products entering the Indian solar market, force enterprises to improve their manufacturing efficiency, and result in longer-lasting products that would help lower tariffs.

Not only this, the foreign companies who would want to enter into the Indian Market have to setup their manufacturing units in India, which will further help the Indian Solar Economy to grow.

During an interview, Chief Executive Officer of Adani Solar, Mr. Ramesh Nair stated related to ALMM, “Stringent time-to-time audits are always welcome from the government’s standpoint. ALMM could avoid incorrect qualification of manufacturers who do not have a robust process in place and help the emerging manufacturing industry set up effective controls to ensure quality.”

As a result, the industry’s performance and degradation rates may improve. With the industry considering a longer useful product lifecycle for their project, this could contribute to a reduction in tariffs. A minor increase in end-user cost might be an acceptable trade-off to avoid tariff losses due to degradation and other costs associated with untested panels.

One more leading solar company, RenewSys Solar’s Global CEO and Managing Director, Mr. Avinash Hiranandani stated about ALMM, “The ALMM guidelines are fairly simple, and RenewSys has applied for the same. We await the approval and are sure that as the COVID-19 situation improves and work begins, we will receive our approvals. ALMM will ensure competition among other approved players, making it fair play for developers, distribution companies, manufacturers, and other stakeholders by ensuring competitive tariffs through quality products.”

Bad Side of ALMM:

ALMM would not aid the business significantly, according to certain industry stakeholders. They said that the exorbitant application fees of $5,000 ($66) per MW on cells and modules would be prohibitively costly for smaller manufacturers, raising overall project costs and, in turn, driving up electricity tariffs.

The costs don’t end there: as part of the listing process, corporations outside India are also asked to pay for “preliminary inspection” at each production facility. Before registering a company, the MNRE’s standards specify that it will check manufacturing units operating beyond the authority of Indian laws. Applicants must pay for all costs associated with the inspection, including travel, lodging, and other expenses for both domestic and overseas officials assigned to the work of inspection. Depending on the size and location of the industrial site, these fees range from 500,000 ($6,583) to 3 million ($39,500) every visit.

Given the COVID-19 travel limitations, traveling within the country is not regarded as safe, let alone foreign site visits, which will be very dangerous, costly, and impractical. There’s no way of knowing when these international travel restrictions will be eliminated.

ALMM with Short Term Drawbacks And Long Term Benefits

Stakeholders also claimed that the entire process of becoming listed in the ALMM takes time, which would result in project delays and supply chain interruptions. They argued the entire process was pointless because quality control was already in place thanks to Bureau of Indian Standards (BIS) accreditation. BIS certification, according to the industry, is quite similar to the International Electrotechnical Commission (IEC) standards.

These fees could be prohibitively expensive, particularly for Chinese enterprises with large manufacturing facilities. According to the guidelines, if a corporation has a 10 GW installed capacity but only sells 1 GW to India, it is still required to pay for the entire 10 GW capacity.

Because BIS certification is a requirement for enlistment in ALMM, companies selling existing products or launching new ones in the Indian market may face longer lead times. Mercom previously discussed the industry’s worries about the BIS certification procedure, which featured high fees and long wait times.

Chief Operating Officer at Amp Energy India, Mr. C Chaudhary said about the negative side of ALMM, “The time involved in ALMM registration for foreign manufacturers for the first time is about one year. Also, BIS is a prerequisite for the ALMM application. This would substantially increase the time involved for a product to launch in India even after the initial ALMM registration by the manufacturer.”

Other than the high prices and extended lead times, the ALMM mandate would hinder international players from joining the market. Companies must currently submit information on their manufacturing units’ production, raw material purchases, sales, profit and loss account, statement of assets and liabilities, and balance sheet for the last three years as part of their ALMM listing application.

Some international participants, notably private Chinese enterprises, may be reticent to give these facts in the application, which could prevent them from being enlisted, according to a representative from an Indian solar cell and module manufacturing company. Because the majority of India’s cells and modules now come from China, this could generate supply issues as well.

REI Expo 2021 is a great place to see the impact of ALMM (Renewable Energy India Expo). Many Chinese firms used to come to the REI EXPO before 2021 to promote their solar products, but the majority of the companies at the REI EXPO in 2021 are Indian. REI EXPO 2021 has sparked minimal attention from outside solar industries.

How Can We Help?

Hope this information about “Approved List of Models and Manufacturers (ALMM)” helps you.

If you are planning to start a solar business or install a solar solution, you can connect with Ornate Solar to get the best assistance with the best prices for solar panels and inverters. We are the official partner of Canadian Solar panels & Renewsys solar panels in India. We are also the official distributor of SolarEdge inverters with DC optimizers, Enphase microinverters, Fronius On-Grid Inverters, and Havells solar inverters in India.

For more information, please give us a call at 011 4353 6666.