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India may cancel 3-4 gigawatts of solar projects after the renewable energy ministry directed clean energy agencies to withdraw and reissue tenders that were rushed to bypass upcoming import restrictions. From June 2026, government solar projects must use locally made modules and cells, but tenders submitted before August 31 were temporarily allowed to use imports. Industry groups alleged that agencies exploited this exemption by offering bid windows as short as seven days to secure cheaper Chinese cells. The ministry confirmed misuse and asked agencies to act within 15 days. India expects to become largely self-sufficient in solar cell production by March 2027.
At least 3-4 gigawatts of Indian solar projects may be cancelled after the government directed clean energy agencies to reissue tenders that were rushed to bypass import restrictions that kick in next year, an industry source told Reuters on Friday. Advertisement
The country's renewable energy ministry in a circular on Friday asked the agencies to cancel some solar tenders and reissue them, but did not name the agencies or disclose the power expected to be generated by such projects.
Renewable energy agencies act as intermediaries between the government and clean energy project developers, and issue tenders for projects. Once the projects are built, the electricity is sold to state power utilities.
Starting June 2026, India's clean energy policy will require developers of government projects to use only locally-made modules and cells. Most Indian companies use cheaper China-made solar cells.
But the government in July allowed projects with bid submission dates on or before Aug. 31 to use imported cells.
In late August, the Indian Solar Manufacturers Association made a representation to the government, reviewed by Reuters, in which the industry body said the clean energy agencies misused this exemption, issuing tenders with unusually short bid windows to lock in cheaper imports before the deadline.
The government found nearly 3-4 gigawatts worth of projects to be misusing the exemption, the industry source said. The source could not be named as they were not allowed to speak to the media.
Some agencies gave companies only seven days to submit bids, the ministry said in the circular on Friday.
This short window may have been used to avoid the import restrictions, the ministry said.
The agencies have been given 15 days to report on the action taken.
India should be largely self-sufficient in solar cells only by March 2027, and effective production could be lower in the initial quarters after the restriction, SBI Caps said in a research note in August.
Source: Reuters
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