Could India reach its 2022 target of 100 GW ?
India’s estimated cumulative installed solar capacity reached 30 GW at the end of the first quarter of 2019. However, rooftop installations still only make up 12 per cent of total solar installations which is some thing around 3.5 GW and the country could achieve only 9 per cent of its targeted rooftop capacity addition of 40 GW by 2022 if there would not be aggressive push to the installations.
Despite the hype and incentives, solar installations in the country are slowing down. Though the first quarter of 2019 saw a 4 per cent jump in installations to 1,737 megawatt (MW) but when compared to the 1,638 MW installed in Q4 2018, it was down 49 per cent compared to 3,377 MW added in the first quarter of 2018.
Source:-Business Today (Mercom Report)
Investments in the sector were over $2.8 billion in the first quarter, though 12 per cent lower compared to investments made in the first quarter of 2018. The report notes that while 85 per cent of the installations were large scale, only 15 per cent accounted for rooftop solar. Rooftop installations fell by 33 per cent year-on-year with capacity additions of over 260 MW in the first quarter of 2019, compared to 390 MW in Q1 2018.
According to the Institute of Energy Economics and Financial Analysis (IEEFA), 75 GW of renewable capacity has been installed across India, 28 GW has been auctioned and 37 GW of capacity is under various stages of tendering and bidding with a view to come on stream in the next couple of years.
While elections and inability to get clearance for many projects was an issue, there were many other problems the sector was going through. Availability of credit has been a brewing issue and has impacted the growth momentum of renewable energy in the last six months. Easy availability of credit and reducing the cost of capital will result in speedy implementation of projects and also reduce the cost of construction
In the last five quarters, government agencies such as the Uttar Pradesh New and Renewable Energy Development Agency (UPNEDA), the Grid Corporation of Odisha (GRIDCO), Gujarat Urja Vikas Nigam Limited, and others have cancelled nearly 5 GW of solar auctions, citing the final tariffs were either too high or there was a wide gap between the highest bidder and the rest. Only part of this capacity was re-tendered. Other main factors that affected the capacity addition were land and transmission constraints, a 25 per cent safeguard duty on imports from China and Malaysia and issues in the tender schemes and tax uncertainties.
Despite this, India’s capacity addition is one of the fastest in the world. The global energy demand increased an estimated 2.3 per cent in 2018, and of this, India, China and the United States accounted for almost 70 per cent of this addition, says a REN21 (Renewable Energy Policy Report for the 21st century) report. India ranked fourth globally for non-hydro renewable capacity and overtook Italy to reach fifth in the global rankings for cumulative solar PV capacity.