The government has eased solar cell sourcing rules for projects bid by August 31, 2025, to ensure project viability. While this provides relief from strict domestic manufacturing mandates, developers must still navigate specific contract terms for projects bid between late 2024 and mid-2025. Investors should monitor how this affects project costs and commissioning timelines.
The Ministry of New and Renewable Energy (MNRE) has issued an important clarification regarding the Approved List of Models and Manufacturers (ALMM) for solar photovoltaic cells. This update is designed to smooth the transition toward domestic manufacturing without stalling ongoing solar projects. The core of this decision is the exemption from ALMM List-II requirements for specific categories of solar power projects.
Projects where the bid submission deadline fell on or before August 31, 2025, are now exempt from sourcing solar cells from the ALMM-listed domestic manufacturers. This exemption applies to tenders that were live as of July 28, 2025. This is a significant relief for power developers, as it provides more flexibility in the supply chain. Before this clarification, there was uncertainty about whether developers would be forced to use only local cells, which could have led to higher costs or supply shortages for projects planned before domestic capacity fully scaled up.
However, the regulatory environment remains nuanced. The ministry has clarified that if specific tender conditions required the use of ALMM-listed cells for bids submitted between December 9, 2024, and July 28, 2025, those projects remain contractually bound to their original terms. This creates a mixed landscape for investors. Companies with large portfolios of renewable assets will need to manage different cost and supply structures depending on when each project was bid and the specific conditions of those tenders.
Additionally, the ministry provided clarity for net-metering and open-access projects. These are now exempt from ALMM List-II requirements for solar cells if they are commissioned by December 31, 2026. Residential rooftop projects under the PM Surya Ghar Yojna also receive an exemption until the scheme concludes in March 2027. Investors should note a key distinction in these rules: while solar cells have received this temporary relief, the requirement to source solar PV modules from ALMM-listed manufacturers remains in effect for most projects.
For domestic solar manufacturers, this policy adjustment does not signal a retreat from the 'Make in India' push. Instead, it serves as a practical measure to ensure that the current pipeline of solar projects does not face implementation delays due to supply chain mismatches. The long-term goal of domestic capacity building remains unchanged, as the industry continues to add significant gigawatt-scale production capabilities.
Going forward, the key monitorable for investors will be how solar developers manage their project execution timelines and costs under these varying regulatory requirements. The ability to source cost-effective components while adhering to remaining domestic content rules will be a major factor in determining profit margins for renewable energy companies in the coming quarters.