India invites initial bids for setting up renewable energy manufacturing zone


Indian Ministry of Power and Ministry of New and Renewable Energy have issued an expression of interest (EoI) to set up manufacturing zones for power and renewable energy sectors on a pilot basis.

This project is part of a cooperative initiative by the Ministries to establish three industrial zones with a total investment of Rs 1,000 crore (US$131 million). The scheme will run for five years, from FY 2022-23 to FY 2026-27.

State governments and a special purpose vehicle can participate in the project, and the successful proposer will be selected by process authority that has adopted a single stage EOI process.

The manufacturing zone will focus on renewable energy manufacturing for solar photovoltaic projects, wind energy projects, and solar thermal projects. Equipment manufacturing for biomass, hydropower, green hydrogen, and power transmission and distribution will also be included in the zone. The project's financial assistance or grant-in-aid will be released in four installments over a five-year period.

To wean off its reliance on Chinese imports, India is pushing domestic production, particularly in the power and renewable energy sectors. The government has previously provided incentives for some manufacturing categories, such as the production linked incentive (PLI), and is likely to provide additional incentives to boost domestic producers.

The Ministry of Power announced the first phase of the National Hydrogen Mission policy on green hydrogen and green ammonia in February, with the goal of increasing hydrogen and ammonia production using renewable energy. The second part is expected to be released soon, and it will likely focus on topics such as viability gap funding (VGF) for green hydrogen and green ammonia projects, as well as possible industrial incentives.

According to the government’s EoI document, each proposer must submit a single proposal in line with the conditions of the document on or before June 8, 2022.

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