Building a complete manufacturing ecosystem in India. 1) India currently has a negligible presence in global PV manufacturing, with less than 5% share of module production capacity in 2010. 2) The key challenges for India to become a major player are the large capital expenditures required, the need for fast scaling and continuous cost reductions, and obtaining low-cost financing. 3) While India's policy support provides some incentives like local content requirements, more could be done to support manufacturing as other countries like China provide much larger subsidies in the form of low-interest loans.

1. Building a complete manufacturing eco-
system in India
November 10,2011
Madhavan Nampoothiri
Energy Alternatives India

2. “Has India missed the chance to
become a PV manufacturing super-
power?”

3. Overview
• Global PV manufacturing - Where does India stand today?
– Crystalline Silicon(Polysilicon to modules)
– Thin Films
– Balance of Systems(Inverters)
– PV Manufacturing Equipment
• What are the challenges to become a serious player?
• Is policy support sufficient to make that happen?

4. Solar PV – The evolution..
Annual Installations Annual production - Modules
90% 60%
80%
50%
70% Japan
60% 40%
EU
50%
USA
Japan 30%
40%
30% 20% EU
Rest of the
20% World Rest of the
10% World
10% USA
China/Taiwan
China/Taiwan
0% 0%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Source: EPIA Source: EPIA
Cumulative Global Installations(2010): Share of global PV Production capacity(2010):
Europe –30 GW (over 75%) China – more than 50%
India – About 30 MW (less than 0.1%) India – Less than 5% (in modules)

5. Global PV Manufacturing : Charging ahead!!
C- Silicon Thin Films
60 China: 4.5
16 GW 54.0
52.3
4
50 India: 47.3 Moser Baer 60 MW
0.6 3.5 HHV (a-Si)
GW 41.5
40.0
40 36.7 3
Capacity (GW)
Capacity (GW)
32.9
2.5 Shurjo
30 28.2
China:
20 GW
2
20 1.5
India: 1
10 1.2 GW
0.5
0 0
2009 2010 2011
2010 2011
PolySilicon Wafer Cell Module CdTe CIGS a- Si
Source: iSuppli(May 2011)
Source: GTM Research(May 2011)

6. Global Inverters manufacturing: Not left behind..
Top Global Inverter Manufacturers
Inverter Production Capacity vs. Solar PV Installed Capacity
SMA
SMA-35% Power One
45 SMA-40% Market
Share(E)
Kaco
Market
40 Share
Fronius
35 SMA-40% REFUsol
Market
30 Share Satcon
25 Danfoss
20 Solarmax
15 Delta
10 Advanced Energy
5 Indian Scenario
0
2009 2010 2011
AEG
Invertor capacity(GW) Installations(GW)
Delta Electronics (WIP)
DB Electronics

7. PV Manufacturing equipment : European
domination continues..
Rank Company Revenues Country
($Million)
1 Applied Materials 1495 USA
2 Centrotherm Photovoltaics AG 825 Germany
3 GT Solar Incorporated 775 USA
4 Meyer Burger^ 735 Switzerland
5 Gebr.Schmid GmbH+Co 570 Germany
6 Ulvac, Inc. 380 Japan
7 Roth & Rau AG* 325 Germany
8 RENA Sondermaschinen GmbH 300 Germany
9 48th Research Institute of CETC 295 China
10 Oerlikon Solar 195 Switzerland
^ Second after acquisition of R&R
* To be acquired by Meyer Burger
R&R sold CdTe coating division to undisclosed Chinese buyer
List includes both c-Si and Thin Film capacities
Source: VLSI Research
HHV in India

8. Indian PV manufacturing – The challenges
Financial
Operational
Market

9. Market Challenges – Dramatic price drops Manufacturing Operations
$4.50 Highlights:
$4.25
$4.00
$3.50
Excess
capacity
- Commodity manufacturing(almost)
$3.00 - Standard off-the-shelf technology available
$2.50 $2.60
$2.20
$2.00
$1.50 Key success factor:
$1.20
$1.00 $1.00
$0.70
• Lead times in commissioning a unit
$0.50 $0.45
$-
$0.21 • Utilization rates
2008 2009 2010 2011(Q4) 2012(ASP • Infrastructure(ex. electricity)
Estimate)
Module($/W) Cell($/W) Wafer($/W) Polysilicon($/W)
C-Si
Investments and returns Cost Drivers
Poly Silicon Ingot & Cells Module Module 8.0% 0.3% 89.0% 0.7%
Wafer
Investments/ Medium Medium High Low Cell 37.0% 3.0% 52.0% 5.0%
MW
Optimum Very High Medium Low Very Low Wafer 30.0% 4.0% 60.0% 4.0%
production
scale
Polysilicon 45.0% 26.0% 17.0% 10.0%
Margins High Medium Low Low
0.0% 20.0% 40.0% 60.0% 80.0% 100.0%
Capex Depreciation Electricity Materials Labor Cost Others

10. Market challenges Manufacturing Operations
- Narrowing gap with c-Si Highlights
- R&D intensive, not commodity manufacturing
- Lower conversion efficiency - Standard production technology not available
- a-Si : limited efficiency upside - Successful CdTe manufacturing tech
proprietary
- Cadmium : a carcinogen Success factors
- CIGS : Not cost competitive yet • Lead times
• High R&D
• Sourcing of rare earth metals/raw
materials
Thin
Investments and returns Films Cost Drivers
a- Si CdTe CIGS
CdTe
Capital High Medium High CIGS
Investments
a Si
Optimum Scale Low Low Low
of Investment 0 20 40 60 80 100
Raw material and consumables Capital Depreciation & amortization
Energy Labour
Research & Development Others

11. Policy support for Manufacturing
Chinese Advantage
Ontario, Canada • Low interest loans (4.8% in Jan 2011)
- Local content • No principal or interest payments for
requirement first 5 years
Italy • Scale of loans much higher (over 60% of
- 10% higher FiT CAPEX funded)
Chinese Advantage for made in EU • Local content mandated for
• Low interest loans (4.8% in Jan 2011) manufacturing
• No principal or interest payments for first 5 years
USA • Scale of loans much higher (over 60% of CAPEX
India
- Local content requirement under
-Sunshot Initiative JNNSM
-- DOE loans(eg. Solyndra) funded) -Incentives under Rajasthan policy
• Local content mandated for manufacturing- Duty exemptions

12. Half glass full or half glass empty?
• Global PV manufacturing - Where does India stand ?
o Crystalline Silicon – Negligible, but relatively better
o Thin Films - Negligible
o PV Manufacturing Equipment – Negligible
o Inverters - Negligible
• What are the challenges?
o Market - Global excess capacity
o Operational – Scaling up fast, continuous cost reduction, efficiency increases
o Financial – Huge capex outlays, Low cost financing
• Is policy support sufficient?
o More can be done
• Silver lining – We can only get better!!

13. How can we get around the
challenges?
• Shammy Khan, VP Strategic Markets, Flextronics - "PV
manufacturing- Outsource vs. InSource"
• Dr. VS Gangadhara Rao, Lanco Solar, "PV Manufacturing
Technology Options“
• Prasanth Sakhamuri, HHV Solar, "The case for equipment
manufacturing in India - experience with thin film equipment
& lines & the potential for cost reduction“
• Navakrishna Akkineni, Solar Semi, "Experience with Indian
Manufacturers – Strategy & Opportunity"

14. Thank You