Last Updated: January 04, 2023
Bridge to India
New Delhi: India’s renewable capacity, exclusing large hydro, is expected to have touched 122 GW by December 2022 against the Government of India’s target of 175 GW – a deficit of 30 per cent, consultancy firm Bridge to India said.
Annual solar and wind capacity addition has averaged at about 9 GW over the last five years as against a corresponding target of 19 GW. Wind capacity growth has suffered particularly badly since transition to competitive auctions in 2017 with average annual capacity addition of only 2 GW, it said. In contrast, solar capacity has grown more consistently.“
The sector has been somewhat muddling along recently in absence of policy stability and proactive long-term planning. The task ahead is going to get more acute as we add more intermittent renewable capacity impacting grid stability,” said Vinay Rustagi, MD, Bridge to India.
The government has adopted an extremely ambitious target anticipating combined solar and wind capacity addition of 36 GW annually up to FY 2030, but 2023 is expected to be a very slow year as many projects are being postponed due to lack of domestically manufactured modules.
The firm said in a statement module supply over next year is expected to be constrained following implementation of up to 40 per cent BCD and Approved List of Models and Manufacturers (ALMM) policy. The government has already provided time extension of up to September 2024 for many centrally auctioned projects.
“It is clear that an urgent course correction is needed to meet revised targets and address both demand and supply side challenges in the sector,” Bridge to India said, adding the government needs to work on four key areas – encourage demand from states, address land and transmission bottlenecks, improve integrity of bidding process, and provide policy certainty to corporate and residential renewable markets.
Most states seem reluctant to buy more renewable power despite strong policy thrust, growing demand and low cost, and 25 of the 30 states had adopted Renewable Purchase Obligation targets lower than the central government target of 21.2 per cent for FY 2022.
“Even the low targets were rarely enforced by state regulators because of poor financial condition of DISCOMs, intermittency concerns, lack of renewable resource and land at reasonable cost,” the firm said.
It added that initiatives such as solar park scheme, green energy corridors and renewable energy zones have faced extensive delays and cost overruns, and almost all utility-scale projects face acute land and transmission challenges delaying execution.