In Exclusive Talk With Mr. Geoffrey S. Kinsey
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- How much modules have you supplied to India till now, what is the target/expectation in 2017-18
More than 350 MW installed to date (over 1 million modules)
Target for 2017/18 is about 200 MW.
- The recent aggressive bidding by various developers keeping Solar Tariffs in the price range of Rs.2.44-3.3 per kWh in various Solar Tenders…Whats your view on the viability, Costs & timeline pressures, Resource Challenges (Materials, ManPower, Execution, Grid Connection, Land Possession) etc…
The low-end tariff recentlyquoted, Rs. 2.44, is a “fringe” bid that was placed at one location, where commissioning costs were particularly favorable; it is also based on speculation that future project costs will be well below current costs. Such speculative prices can be expected in any auction process, but the fundamentals of power plant construction costs will not necessarily shift to meet these expectations. As such, low-end bids do not represent the cost of PV energy across the country. Understanding that such low numbers tend to attract (probably undue) attention, it would be better to track average tariffs as a way to understand the near future of the market.
Some of the lowest tariffs seen in the recent auctions have been for solar parks, where land, interconnection and other shared infrastructure costs are quite low. We have also seen a large influx of low cost capital for solar projects in India (Engie, Softbank, etc.) due to significant de-risking of the Indian solar sector over the last few years. Even so, we believe some developers have taken aggressive calls on equipment costfor the next 12 – 15 months. So far this year, we have not seen softening of the poly silicon and module price going into Q3 as we saw in 2015 and 2016. Poly price has increased in the last few weeks, and if the poly price holds in the $13 – $15 per kg range, we may not see the expected decline in the module price.
- Kindly enlighten our readers on the performance of your modules in India in various geographic locations, customer feedback.
The multicrystalline modules that make up the bulk of Hareon Solar projects in India to date have predictable performance wherever the local solar resource and temperature are known. We track the performance of our modules against “predicted” generation (using PVsyst) and “expected” generation (using measured local conditions). Performance to date matches expectation and, in some cases, has exceeded predictions based on the module ratings. Sample data from our installations is available on our website (hareonsolar.in)
- What are the Module Price Guideline on module prices for next Q3-Q4-2017 and 2018
Assuming stable polysilicon prices, we expect prices for Tier-1 modules to remain in the vicinity of US$0.32 in Q3 – Q4 2017.
- Present some noteworthy projects, case studies of solar plants built using your solar modules
At 172 MW, the Dichipally project recently commissioned with ReNew Power is the largest project Hareon has constructed outside of China, and most likely the largest solar project by a Chinese company in India. Our six utility-scale projects in Telangana and Andhra Pradesh add up to 320 MW.
- Please describe in brief about your company, directors, promoters, investors, its vision & mission
Hareon Solar, founded in 2004, is one of the world’s largest solar cell & module manufacturers. Hareon Solar also develops, constructs, and operates PV power plants around the world. Hareon Solar Technology Co., Ltd. has been listed on Shanghai Stock Exchange (ticker: 600401) since 2012. Current market capitalization is about US$1 billion.
- What is the size of your company in terms of manufacturing capacities, growth chart, future expansion plans, revenues, shipments, ASP’s, financial figures,
Hareon Solar has over 6000 employees worldwide. Our wafer, cell, and module capacity is 2 GW. We have installed over 1.4 GW worldwide. We are a publicly-traded company (Shanghai Stock Exchange: 600401).
- What are your plans for India, your view on the GOI target of 100GW Solar Power by 2022
Hareon Solar is proud to have contributed about 2% of the PV installed in India to date. We hope to expand with local manufacturing in India, for both the utility and distributed generation sectors, so we can play an increasing role in helping India reach, and then exceed, its 100 GW target. With solar energy at or below grid-parity in most parts of the country, we believe the 100 GW target is reachable by 2022. We hope the GoI will continue its support for the solar industry by strengthening the DISCOMs (UDAY scheme), and investing in grid modernization to better integrate renewable sources.
- What are your plans for Manufacturing set up in India, the opportunities and challenges in manufacturing in India
Hareon is excited to manufacture in India soon. We have a plant under construction in Visakhapatnam (hareoninternational.com/factories/).
- Solar Trade Wars :What is Your View ?
Trade disputes can be a healthy part of any industry, shining light on any unfair practices and providing insight into what the market price should be. However, once trade disputes escalate into a “war” they tend to destroy, rather than create, value for customers (as well as suppliers). In the case of the current module price war, the relentless downward pressure on module prices cripples companies delivering quality products and rewards those companies that supply sub-standard hardware. Deploying this hardware will reduce energy generation, drive up O&M and legal costs, and undermine confidence in the PV sector, ultimately resulting in more expensive solar energy for all.
- How much is your R&D budget as % of your sales / profits
The R&D budget is typically about 4% of revenue; this includes reliability testing.
- What are the top 5 markets for your company in the past, present and future
With the growing awareness of the near- and long-term costs of climate change, the entire globe is becoming a promising market. We expect China, India and the rest of APAC, and the USA to remain the primary markets for the next several years. The Middle East, North Africa, and South America are emerging as promising markets in the medium term.
- Technology road map in terms of 1500V , Double Glass, BiFacial Cells, PERC/PERT Technologies, HIT/HJT, IBC upcoming game changes technologies
Our 1500-V modules and dual-glass modules are available as commercial products. We have developed the capability to manufacture bifacial cells (and modules) and for PERC cells. These products will be commercialized as the technologies become more economically viable. We have ongoing R&D efforts in IBC and other high efficiency cell technologies.
- Explain various guarantees, warrantees, insurance, certifications, test results, performance report of your modules
Hareon provides a 25-year performance warranty and a 12-year product warranty. Hareon productsare qualified to IEC 61215, as verified in our certified in-house test lab in Taicang, China. Hareon products maintain a host of certifications worldwide, including for India, Japan, and Europe (details can be found at hareoninternational.com/products/).
With costs and performance stabilizing across the sector, we consider module reliability to be the primary differentiator between PV products. Warranties are a necessary – but not sufficient – component of the diligence needed to assure return on PV investments. Ongoing batch testing (via accelerated stress tests) is also essential to confirm modules will go the distance and meet their performance guarantees.
- Kindly highlight your product, technology & company USP’s, distinctive advantages etc…
Hareon is a vertically-integrated supplier of cells and modules, as well as a project developer and owner. As such, we have a thorough understanding of, and a large financial stake in, how our products perform over their service life. We offer mono- and multicrystalline modules. We have found that mainstream multicrystalline modules provide the best value within the utility-scale market.
As a publicly-listed multinational, Hareon can access capital and worldwide procurement channels that enable the highest returns on projects with our modules.
- Do you also bring financing solutions for your customers ?
We do. As a publicly-traded company (Shanghai Stock Exchange: 600401), Hareon can often finance projects at favorable rates for customers.
- As a manufacturer, kindly share your plans to foray as developer or equity investor in solar pv power projects.
Hareon has found success in this approach. We have been proud to form successful partnerships in co-developing and co-owning projects with Renew Power and Nereus Capital in India.
- Please share information of some new orders in hand.
Cannot share specific order information.
- What are the trends in new manufacturing technology equipment, materials, processes, innovations etc…
The rise of dual-glass modules brings opportunities for increased durability and overall system cost reduction. The dual glass design makes bifacial modules more promising wherever the mounting approach avoids backside shading from the structure or cables. The transition to diamond saws reduceskerf and wafer cost; 5-busbar cells reduce resistive losses and increase module efficiency.
- As a module manufacturer provided 25 years warranties….is it backed up by warranties by cell manufacturer, materials manufacturers ?
In order to maintain quality, Hareon produces its own cells and its multinational procurement team works to verify that suppliers meet strict specifications for the bills of materials.
As mentioned in question #14:
With costs and performance stabilizing across the sector, we consider module reliability to be the primary differentiator between PV products. Warranties are a necessary – but not sufficient – component of the diligence needed to assure return on the solar investment. Ongoing batch testing (via accelerated stress tests) is also essential to confirm modules will meet their performance guarantees.
- What is your commitment towards the solar sector in India
Hareon plans to remain a significant deployer of renewable energy products in India for decades to come. To that end, we are engaged in forming partnerships to sustain the solar sector in India. Local supply chains and local manufacturing (including the factory we are building in Visakhapatnam) will play an increasingly important part of that strategy.
- What will be the cost, technology trends in solar pv modules
As the PV sector matures, look for it to adopt practices similar to other construction industries. As the module cost is approaching the cost of its materials, further innovation is likely to occur in the areas of installation and proving lifetime performance.
Installation is likely to become more mechanized, so modules will probably become larger (similar in size to roof decking, for example) and/or pre-fabricated for faster, more consistent installation on-site.
In order to prove modules will deliver on their assumed degradation profiles, more comparative accelerated stress testing and materials analysis will be used to help separate the “wheat” from the “chaff”.
- Comment on the warranty claim rate, rejections, replacements etc…
Warranty claims over the last three years have ranged from 0.01% to 0.02% of our shipped product. To date, such claims have mainly been the result of perceived cosmetic issues (snail trails, etc.) or glass broken at some point during shipping or installation.
Feel free to add/modify/delete any question.
No comments on the following:
- How has RUMS Bid and SECI Wind Tender Bid has changed the dynamics for Solar & Wind Projects in India. What are the challenges, threats and new opportunities you see emerging now?
- What is the impact of RUMS & SECI Wind Bid on past projects and upcoming tenders
- What has delayed the new upcoming tenders by NTPC/SECI and what are the learning’s and take aways from RUMS & SECI Wind Bids
- What are the expectations from Government / NTPC / SECI / RUMS Team
- What are the expectations from Tech Suppliers like Modules, Inverters, BOS, Trackers etc….Whats the tech solution you thinking of deploying
- Are the developers betting on Modules Prices or Interest Rates ?
