The government has come up a slew of reform initiatives to boost steady and sustainable growth in power sector. Interestingly, this was not only focused for solar energy segment but also for wind, thermal and hydro power, which were less regarded in the past few years and were struggling with number of issues including fuel supply to power off take.
Even as industry analysts warn of slowdown in the renewable energy sector, the segment has added 4,273 MW of new capacity to the grid during the first half of this fiscal, which is one of the highest additions in a first-half year period in the last several years. However, the addition to capacity during the April-September 2019 is only 36 per cent of the target (11,802 MW) set for the fiscal.
According to government’s official data update by Ministry of New and Renewable Energy (MNRE), solar power segment continues to be the major contributor of new capacity growth in the renewable energy sector with a share of more than two-thirds of the new capacity. It added 2,921 MW (includes 2,479 MW ground-mounted and 442 MW rooftop) capacity during April-September 2019, according to the Wind sector continues to show progress and it added about 1,304 MW of new capacity. During the last fiscal, this segment added 1,481 MW and this year it is expected to add more capacity. As on September 30, 2019, total grid-connected installed renewable power capacity in India stood at 82,589 MW. The total installed capacity of wind power stood at 36,930 MW. The fast-growing solar segment had a cumulative installed capacity of 31,101 MW (ground-mounted: 28,863 MW; Rooftop: 2,238 MW).
Recently, a Crisil report has warned that India’s installed capacity in renewable energy could increase by just 40 to 104 GW by fiscal 2022 from 64.4 GW in fiscal 2019, because of enduring policy uncertainty and tariff glitches. The sector has witnessed a material waning of developer interest last fiscal. Little over a fourth of the 64 GW of projects that were auctioned by the Centre and States did not receive bids or response was lukewarm and 31 per cent faced delays in allocation after being tendered. “Thus, despite the increase in tendering volume, not only has allocation of projects slowed down, but both under-subscriptions and cancellations of awarded tenders have also increased,” says Miren Lodha, Director, Crisil.
However, with the government relaxed the tariff caps as this could help improve the viability and attract new players. Power and New & Renewable Energy Minister R K Singh has exuded confidence that India will achieve 175GW of renewable energy target by 2022. “The target of having 175 GW of renewable energy by 2022 looks huge. But, today we have established 83 GW clean energy. About 29 GW of renewable energy is under installation. That makes it 112GW and under about 30GW is under bid. So that makes the 175GW of renewables. I am very confident that we would make it (175GW of renewables by 2022),” Singh during a ministerial panel discussion at Indian Energy Forum.
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