'Wait for few more weeks': Suzlon CEO on Trump's IRA fund halt, impact on renewable sector

Suzlon Group chief executive officer (CEO) JP Chalasani, in a recent earnings call, has addressed concerns around the new US administration under president Donald Trump's decision to halt Inflation Reduction Act (IRA) fund disbursements, a move which is likely to impact both US independent power producers (IPPs) and Indian module manufacturers.

In response to a query on the "impact of Trump's era on the renewable energy sector", Chalasani said, "I only look at it is that in case the opportunities for, first of all, I have no clue about what is going to be impacted because every day you are reading a clarification. So, suddenly IRA is impacted, next I see a statement which is the IRA is impacted only to the extent of the EVs so it is an evolving situation. And there is a clear view that onshore wind turbines won't get impacted. Only the offshore is going to get impacted. So, therefore whether you speak, or I speak, it is more of a gossiping between two of us and both of opinion."

We should wait for a few more weeks before we see any impact on India, he added. "If at all there is going to be an impact, in my opinion, it will be a positive impact, but not negative impact. But the investment comes down in US, there will be more investment opportunities coming down here, coming in India. So, I can only see the positive side of it. At this stage, I am not seeing anything, significantly negative for us," Chalasani further said.

The Suzlon CEO also spoke on the extended part of question which asked whether Chinese and European players would start dumping in the Indian market. "Chinese are already there. And Chinese are there not there anyway significantly in the US at this stage. So, the US market is mainly with the GE and the Vestas. So, I don't think that would make a difference. European significantly presents today their manufactured used amount of quantities in India, but they are exporting because they are unable to compete in India. So, therefore, either way, it does not make a difference," he answered.

On solar module price correction, Chalasani said, "The only thing what you are seeing is the tariff during the solar time are coming down because the supply is higher, and the demand is less. So, I think there is enough appetite in the market to meet the current load profile for the wind capacity and the wind tariffs are not going up. I don't think any tariffs are going up because tariffs are only falling even for FDRE because solar prices are falling. Only the case of solar, the tariffs have gone up because of restrictions on this and tariff significantly gone up, if I remember right, the solar standalone now is almost Rs 3 because of the domestic content criteria, so that can increase the tariffs, but the wind tariffs are not increasing."

Wind tariffs remain the same adding that the demand is going to keep increasing. "To some extent, there is the impact of solar tariffs going up because of domestic content. But I think to that extent the storage space, what is coming down should be able to compensate," he also stated.

In terms of capital expenditure, Chalasani said the renewable energy firm is looking at close to about Rs 350-400 crore of annual capex for the next 2-3 years.

Shares of Suzlon Energy, a part of Suzlon Group, on Tuesday closed 1.01 per cent higher at Rs 56.93.