A lack of communication from the Ministry of New and Renewable Energy (MNRE), Solar Energy Corporation (SECI) and states related to applicability of Force Majeure on business disruption caused by the spread of Coronavirus is creating confusion among the renewable energy companies, according to Federation of Indian Chambers of Commerce and Industry (FICCI).
“The Finance Ministry has issued a circular stating the current situation of COVID-19 should be treated as Force Majeure for solar projects. However, MNRE, SECI and state governments have not yet issued any circular with respect to the same. This is creating confusion in the renewable energy industry,” the industry chamber said in a note on Impact of COVID-19 on Indian Economy.
It added the Renewable Energy Industry is a capital-intensive industry where availability of liquidity is important and the current outbreak of coronavirus has affected the liquidity of the renewable energy companies due to the impact on supply chain.
India imports nearly 80 per cent of its solar cells requirement from China. Indian players are facing uncertainly regarding the supply of solar panels from China. The delay in supply of solar panels beyond the available inventory with the manufacturers is impacting timely completion of solar projects resulting in a force majeure situation.
In its suggestions to deal woth the sitiation, FICCI has said MNRE, SECI and state governments should declare the present situation in the renewable sector as Force Majeure for solar power projects and power purchase bills