UPSC Prelims 2018 Q67: Science & Technology – Energy & Environment
- (a) 1 only
- (b) 2 only
- (c) Both 1 and 2
- (d) Neither 1 nor 2
Answer: (d) Neither 1 nor 2
Explanation
Solar Power in India - Manufacturing and Tariffs
| Statement | Claim | Verdict | Detail |
|---|---|---|---|
| 1 | India is the 3rd largest producer of silicon wafers for PV | FALSE | India is heavily import-dependent for solar components. China dominates global production of polysilicon, wafers, cells and modules (~80% market share). India was NOT in top 3 for silicon wafers as of 2018; still building capacity under PLI schemes. |
| 2 | Solar power tariffs are determined by SECI | FALSE | Solar tariffs are discovered through competitive reverse auctions/bidding conducted by SECI, NTPC and states. SECI conducts the auction but does NOT set the tariff - the tariff is the outcome of market bidding. Grid-connected tariffs are also subject to determination/approval by CERC (Central Electricity Regulatory Commission) for inter-state transactions and SERCs for intra-state. |
Answer: (d) Neither 1 nor 2.
Why each option is right or wrong
- (a) Incorrect. India was not among top 3 silicon wafer producers in 2018 - China dominated overwhelmingly.
- (b) Incorrect. SECI conducts reverse auctions but does not set solar tariffs - they emerge from competitive bidding, subject to regulator approval.
- (c) Incorrect. Both statements are factually wrong.
- (d) CORRECT. India was not third largest wafer manufacturer, and SECI does not determine tariffs (they are market-discovered via auction).
Key point
India's solar reality (2018): Heavy import dependence on China for cells/modules/wafers. Tariffs = reverse auction discovery (SECI, NTPC, states). Regulator = CERC (inter-state) / SERCs (intra-state). Domestic manufacturing pushed via PLI schemes post-2020.
Remember
As of 2018, India was NOT the third largest producer of silicon wafers - global PV manufacturing was dominated by China, and India was import-dependent. Solar power tariffs in India are discovered through competitive reverse auctions (conducted by SECI, NTPC, or states), not determined by SECI itself. Tariff regulation is handled by CERC (inter-state) and SERCs (intra-state).
Common mistakes
- Believing India was self-sufficient in solar manufacturing - even today India imports the bulk of cells and modules.
- Confusing SECI's role - it aggregates demand and conducts auctions; tariff discovery is market-based.
- Missing PLI scheme (2020-21) - Rs 24,000 crore push to build domestic solar cell/module manufacturing capacity.
Exam tip
India solar ecosystem: MNRE = policy. SECI = intermediary/aggregator + auctions. CERC/SERCs = tariff regulation. Discom = buyer. Developers = builders. Manufacturing largely imported from China; PLI to change this.
Sources
- MNRE Annual Report - Solar Sector Progress and Manufacturing Status
- CERC and SECI - Solar Tariff Discovery Auction Documents