European Commissioner Kadri Simson stresses on diversifying solar manufacturing

New Delhi: European Commissioner for Energy Kadri Simson on Wednesday called for broadening the base of manufacturing of renewable energy equipment, especially solar, saying that "putting all our eggs in one basket is a risky strategy".

Broadening the manufacturing market will decentralise the technology for future generations, Simson said, adding that it will help boost both Indian and EU (European Union) economies.

"Until now, we all know that manufacturing for solar PV has largely been dominated by one country. But putting all our eggs in one basket is a risky strategy. Especially when the stakes are so high for the energy transition," she said.

"These days we live in a multi-polar world. If renewables are the future then how we source them should reflect that," said Simson while addressing the 'Solar Energy-Diversification of the global supply chain and EU-India cooperation in the area of manufacturing' here.

Simson's comments assume significance in view of large imports of solar equipment by India and many other nations from countries like China, Taiwan and Malaysia.

She suggested that there's much more to do and untapped potential (of RE equipment manufacturing) to explore.

"Especially when it comes to realigning global supply chains. This is where recently established Trade and Technology Council will come into play. The EU and India can learn from each other. Especially when it comes to diversifying supply chains and developing an open, competitive and rules-based market for solar," she stated.

She was of the view that the biggest democracies like the EU and India have a responsibility to help drive the shift towards renewables.

Referring to the strategic importance of shifting toward clean energy from fossil fuels she stated, "The role of renewables has become even more significant because of another tragedy, this one political. Russia's war against Ukraine." Past six months have taught us that being dependent on fossil fuels, especially those from Russia, is unpredictable and unsustainable, she added.

On the occasion, Minister of State for New and Renewable Energy Bhagawanth Khuba said, "The world has witnessed some major supply chain disruptions in the recent past. In order to avoid such disruptions in the future, the international community has rightly identified the need to diversify our supply chains to make them more resilient and responsive." This becomes even more crucial in the context of RE supply chains, as RE hold the key to a timely energy transition to avoid catastrophic effects of climate change, he added.

He suggested that India and the EU must promote Joint R&D in solar PV technology for improving efficiency and developing reliable substitutes for silicon.

The minister informed that India today has a solar manufacturing capacity of about 20 GW, which is expected to rise to about 75 GW with the enhanced PLI (production linked incentive) scheme.

This capacity will not only meet domestic requirements but will also promote exports, making India a reliable partner for the global solar supply chain, he added.

"We look forward to partner with the EU to use India’s capabilities to facilitate the diversification of the solar supply chain," he also added.

Dr Ajay Mathur, Director General International Solar Alliance also pointed out the centralised solar manufacturing base.

"Currently manufacturing is concentrated. We expect and believe that module manufacturing would be occurring everywhere. There is need for support in early years and as a global community we need to support countries in enabling an environment for manufacturing to occur," he said.

"We are looking at annual capacity addition of PV to about 800 GW each year, which had until now been limited to 200GW. This is a large number and the distances to which these will need to be carried, these seem to be incredible," he added.