November 2 (Solar) – The Indian rupee’s depreciation in combination with a safeguard duty on solar module imports may result in up to 20% higher photovoltaic (PV) project costs in India, rating company Crisil is warning.
Already, the viability of about half of the solar projects under implementation in the country is threatened by the weak rupee, because of which imported modules are more expensive. Crisil says there are 5.5 GW of solar PV projects bid out in the past nine months at or below the rate of INR 2.75 (USD 0.038/EUR 0.033) per kWh.
“Our analysis shows that for every 10% drop in the rupee, the cost of setting up a solar power plant increases by Rs 30 lakh per MW, assuming other factors remain unchanged,” said Crisil Ratings senior director Subodh Rai.
(INR 100 = USD 1.37/EUR 1.2)