Rate of renewable energy capacity addition has since dropped, and in Covid-hit FY21, it was just 7.6 GW. Most of the capacity addition since FY18 have been based on solar plants.
The International Energy Agency (IEA) said the country is set to create new records in adding renewable energy capacities in 2021 and 2022 as it will likely clear the pipeline of projects already bid but have not been commissioned yet due to Covid disruptions. However, the IEA cautioned that the “current surge in Covid-19 cases has created short-term forecast uncertainty for this year”.
The current installed renewable energy generation capacity stands at 94 giga-watt (GW) and about 34 GW is under various stages of implementation while 30 GW is under bidding stages. The highest renewable energy capacity addition of 12.5 GW was in FY18, surpassing the previous record of 11.5 GW in FY17. Rate of renewable energy capacity addition has since dropped, and in Covid-hit FY21, it was just 7.6 GW. Most of the capacity addition since FY18 have been based on solar plants.
“Although India’s capacity additions in 2020 declined almost over 50% from 2019, the country is expected to set new records for renewables expansion in 2021 and 2022 as delayed projects from previous competitive auctions are commissioned,” IEA’s latest global renewable energy market update said, adding that “In India, contracted PV auction volumes in 2020 exceeded our predictions, raising forecast expectations”.
Out of the 143 GW of tenders floated for building solar capacities, around 78 GW had been cancelled since FY17. Out of the 24 GW solar tenders floated in FY21, around 14 GW were auctioned. The lowest solar tariff of Rs 1.99/unit was discovered in FY21. Most developers quoting the lowest tariff in FY21 were backed by foreign capital, who utilized the environment of low interest rates globally.
However, with the imposition of basic customs duty on solar equipment import starting April, 2022, tariffs are expected to increase.