India’s government has ambitious plans to achieve 175 GW of renewable energy capacity by March 2022, although it was standing only at over 81 GW by the end of July 2019. It is even targeting 523 GW by 2030 which IEEFA sees as achievable provided investor confidence is restored and protected with strong policy framework. Pictured is the cityscape of Noida, a city in Indian state of Uttar Pradesh.
India’s government led by Narendra Modi has put the country on a path to achieve 175 GW of renewable energy capacity by March 2022 with solar alone expected to contribute 100 GW. However, the path seems more ambitious and steeper than he probably thought. Till the end of July 2019, India’s total operational renewable energy capacity was not even mid-way – it exceeded 81 GW and solar added a little over 30 GW (see 30 GW: India Installed PV Capacity Till July 2019). It needs to speed up dramatically to achieve its 175 GW target.
However, the Central Electricity Authority (CEA) of India is even more enthusiastic as it sees the country eyeing 523 GW of renewable energy capacity by March 2030 in which solar power is expected to contribute the lion’s share with 300 GW (see India: 300 GW Solar Power Capacity By FY 2029-30).
To be able to meet its renewable energy targets and support grid investment over the coming decade, India would need $500 billion to $700 billion, according to the Institute for Energy Economics and Financial Analysis (IEEFA). It sees the renewable energy targets as entirely achievable with the right policy and contractual risk-return framework.
In a briefing note shared by IEEFA, it sees India to achieve 144 GW of renewable energy by the end of FY 2021-22. Although the market is receptive towards renewables, IEEFA expects the government to provide a clear policy framework while implementing measures to lower risks and protect investor confidence that has been marred by obstacles such as a slow-down in the tendering process, grid integration constraints, and issues with excessively aggressive tariff caps on reverse auctions.
The authors of the report also recommend better coordination between central and state governments to be able to meet the targets.
In another report, this one from India’s Centre for Financial Accountability (CFA) titled Coal vs Renewables 2018, it is said that there was a 90% decline in 2018 coal power project finance/lending in 2018 compared to the previous year. Of all energy project financing profiled in the study, the authors of the report claim 80% went to renewables while coal got only 20%. Most of the financing for renewables came from privately-owned commercial banks.
This article, first published in Taiyang News, can be accessed here.