Second wave may lead to delay in Solar & Wind projects commissioning
Developers have request MNRE for a blanket extension of 3 to 4 months due to disruption caused by the second wave of COVID-19 across the country…
Industry experts are of the view that solar and wind power project commissioning during 2021 could see delay due to rising Covid-19 cases. This second wave across the country has led to lockdown conditions across many states disrupting the workflow of ongoing projects.
Rising covid-19 cases has led to lockdown situations in many states which have disrupted and delayed the equipment’s supply as well as caused a lack of labour availability at the projects site. Solar developers have requested MNRE for a blanket extension of 3 to 4 months because of resulted labour and supply chain disruptions.
These prevailing scenarios could lead to a delay in the project commissioning schedule of around 4GW of utility-scale solar and wind power projects, schedule for commission in the current financial year – according to JMK Research. While on the other hand the Rooftop solar market for OPEX projects is expected to face payment issues mainly on account of full or partial closure of manufacturing units due to lockdown that may lead to liquidity crunch.
In this regard, a blanket extension for 3 months has been requested over-scheduled commissioning date and for financial closure of ongoing projects by the National Solar Energy Federation of India (NSEFI). They had asked for an extension until some stability in module prices and steel prices could be seen in the market.
The NSEFI in its letter to MNRE had stated that the solar industry is already bearing the delayed deliveries, delayed BIS approvals, due to COVID-19 induced slowdowns leading to financial hardships for developers.
However, MNRE in its order released on March 30, clarified that the total extension offered by implementing agencies on account of Covid-19 should not exceed 6 months, including the 5-month blanket extension granted in August 2020.
Though industry experts have argued that since the second wave is witnessing worsen conditions across the country due to the severe spread of infection across the country, every activity of project development is facing greater disruptions and the situation is really grim than last year. Thus there will be at least there a loss of business activity for 3-4 months period as the value chain is facing severe pressure due to additional costs and delays.
Though states were asked not to impose complete lockdown, however, the infection spreading like fire in the jungle has made it necessary for the state to go for lockdown resulting in labour migration…Thus renewable projects in such states are bound to face delays…
Industry experts feel that it will be unfair if the government does not give an extension or impose any penalty for delay in projects commissioning under these prevailing scenarios.
