MNRE Softens and Extends the ALMM Compliance Date to October 2022
Updated: Aug 12, 2022
The Ministry of New and Renewable Energy (MNRE) has extended the start date of compliance with the ALMM list for all open access and Net metering projects to October 1, 2022, from April 1, 2022 before, in a major attempt to balance the needs of developers and local manufacturers.
The move comes after numerous statements and claims from all sides of the argument, particularly the developers' side, which made its position plain through DiSPA on Monday. While developers have claimed that open access projects do not get government equipment subsidies by their very nature, MNRE's declared view on the matter has been that these projects do receive preferential rates or exemptions on specified fees, which is equivalent to a subsidy. With corporate investment in renewables on the rise, it's evident that the ministry sees some rationale in giving these projects a little more time before requiring ALMM compliance. Keep in mind that by October of this year, more'modern' solar modules, principally Mono PERC, should be on the market, which, the MNRE plainly expects, will eliminate the major objection of developers that they are obliged to use older technology in the form of polycrystalline modules.
The ruling is a setback for domestic makers, albeit it was not entirely unexpected. We noticed several manufacturers' surprise when the necessity to use only ALMM authorised products for open access, Net metering, and PM KUSUM component A projects was first proposed. Perhaps they, too, were aware of the difficulty of gaining quick benefits from developers who had already placed orders abroad or had access to domestic inventory of imported commodities.
The MNRE, through its Minister, Sh. R.K. Singh, has hailed the ALMM list as a key non-tariff barrier to support domestic manufacturing. There is currently no foreign manufacturer on the list that has been approved to sell solar modules.
The industry was outspoken in its opposition to the restriction of sourcing only from the ALMM list for a variety of reasons. One of the most significant was that it restricted consumers' ability to select modules with high power output and innovative technology. Because space is limited in commercial and industrial (C&I) projects, developers typically employ modules with 400W or higher power ratings and improved generation efficiency. There are few businesses on the ALMM list that produce higher watt modules, resulting in a shortage of options for C&I solar projects.
The Distributed Solar Power Association (DiSPA), an industry group of distributed solar project developers, has filed an appeal with the Delhi High Court. The ALMM rule, according to DiSPA, might have a negative influence on open access and net metering projects. MNRE should postpone the implementation of the ALMM for the C&I solar projects by at least one year. In response to the plea, the Delhi High Court has requested clarity from the Ministry of Natural Resources and Environment (MNRE) on the provisions put in place to protect C&I solar projects in the pipeline that will be harmed by the ALMM Order.
Official ALMM notification issued by MNRE here:
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