India May Not Reach Clean Energy Target’
Safeguard duty doubts, weak distributor financials: Survey
India could fall short of its target of adding 175 GW of clean energy by the end of 2022 due to uncertainty around safeguard duty and weak financial position of power distributors, a survey by renewable energy consultancy firm Bridge to India shows.
The survey, which covered top executives of over 40 Indian and international companies, also points to prospects for domestic solar manufacturing remaining bleak, which could cap growth of India’s total integrated module manufacturing capacity at below 3 GW by 2022.
“India is expected to add total solar and wind capacity of 66 GW and 52 GW by March 2022, 66% and 87%, respectively, of the targets set by the government,” said the RE CEO Survey 2018, which was shared exclusively with ET.Clean energy players including Hero Future Energies, Engie, Aditya Birla Group, Sembcorp, Azure Power, Trina Solar, Schneider Electric and Larsen & Toubro participated.
More than 70% of respondents said the current bidding environment is “irrationally aggressive”. Tariffs for wind and solar energy hit Rs 2.43 and Rs 2.44 per unit, respectively, last year, making renewable energy cheaper than thermally-generated power. Though green energy tariffs have shown a northward trend in recent auctions, they still hover below Rs 3 per kWh.
Tariffs ought to move up particularly in view of increasing tender issuance, but it remains to be seen whether distribution companies, or discoms, are willing to accept that, the executives said. According to the survey, solar capacity addition would reach 50-75 GW by 2022, as against the government’s target of 100 GW.
The Economic Times, New Delhi, 17th May 2018