The Ministry of New and Renewable Energy (MNRE) has extended the deadline for mandatory domestic solar cell sourcing for domestic, commercial and industrial projects to December 31, 2026.
The move addresses a key supply-chain challenge, as India's solar module manufacturing capacity far exceeds its domestic solar cell production, leaving many manufacturers dependent on imported cells.
The extension is expected to support rooftop solar installations, the PM Surya Ghar: Muft Bijli Yojana, and smaller module manufacturers by easing supply constraints and helping stabilise prices.
Big Relief for Solar Industry; Government Extends Domestic Cell Sourcing Deadline
The extension gives solar developers and module manufacturers more time to comply with domestic cell sourcing norms as India works to bridge its manufacturing capacity gap
Summary
Advertisement
The Ministry of New and Renewable Energy (MNRE) has extended the deadline for mandatory domestic sourcing of solar cells for domestic, commercial and industrial projects to December 31, 2026, providing the industry with additional time to adapt to the new procurement requirements.
According to a report by The Indian Express, the ministry issued an office memorandum granting a seven-month extension beyond the earlier May 31, 2026 deadline. The move comes around six weeks after the domestic sourcing mandate came into effect.
Projects commissioned by the revised deadline will not be required to comply with the domestic cell sourcing rule. However, projects completed after December 31, 2026, must source solar cells from approved domestic manufacturers.
Why the Government Extended the Deadline
The extension marks a shift from the Centre's earlier position. In May, the government had ruled out a blanket exemption, stating that only projects that had already completed milestones such as land acquisition, financial closure and grid connectivity would be considered for case-by-case relief.
Advertisement
According to The Indian Express, the latest decision is aimed at giving module manufacturers more time to adjust to the Approved List of Models and Manufacturers (ALMM-II) framework.
A senior government official told the publication that while India has a large number of solar module manufacturers, domestic solar cell manufacturing capacity remains limited.
The additional time is expected to help protect investments made by module manufacturers while the domestic supply chain expands.
Cell Manufacturing Remains a Bottleneck
India has developed an annual solar module manufacturing capacity of nearly 200 GW, but domestic solar cell production stands at only around 30 GW.
This gap means a significant portion of the country's module manufacturing industry still depends on imported solar cells.
Industry stakeholders have argued that the sourcing mandate could disproportionately affect smaller, non-integrated manufacturers that assemble modules but do not produce cells.
Such companies would have to purchase domestically manufactured cells from larger integrated players, potentially increasing costs and reducing competitiveness.
Advertisement
The sector is also facing oversupply challenges. Against annual solar installations of about 45 GW in 2025-26, module manufacturing capacity is estimated at 60-65 GW, while several manufacturers are reportedly operating at utilisation levels of just 30-40% amid slowing exports and higher US tariff barriers.
Rooftop Solar Programme in Focus
The industry had also warned that the mandatory sourcing requirement could push up domestic solar cell prices, making rooftop solar systems more expensive.
Higher prices could affect the rollout of flagship schemes such as PM Surya Ghar: Muft Bijli Yojana and the deployment of solar-powered agricultural pumps.
Recognising these concerns, MNRE Secretary Santosh Kumar Sarangi met domestic solar cell manufacturers in June and urged them to ensure adequate supplies of domestically produced cells and Domestic Content Requirement (DCR) modules for distributed renewable energy projects while keeping prices affordable.