To address the apprehensions about the viability of low renewable tariffs, discovered in the latest auctions, the government plans to call a meeting with banks and financial institutions in July. The ministry of new and renewable energy (MNRE) would request lenders to extend their support to the sector in the meeting, Anand Kumar, secretary, MNRE, said on Saturday.
The theory — low tariffs not being feasible — can be confounded from the solar generation unit in Rajasthan’s Bhadla. The unit, where the lowest-ever solar tariff of Rs 2.44/unit was discovered in May 2017, is set to be inaugurated in August, Kumar added.
Kumar was speaking at the of global wind day celebrations organised by the Indian Wind Turbine Manufacturers Association (IWTMA). Currently, the lowest wind tariff is Rs 2.43/unit in Gujarat.
India will auction 40 Gw of renewable energy projects — 30 Gw solar and 10 Gw wind — every year till 2028, to meet the power demand of 862 Gw by 2030, Kumar said.
Elaborating further, he said, “We need to have 350 Gw in solar (to meet demand by 2030), of which 100 Gw is planned till 2022. So, we have to bid out at least 30 Gw each year from 2020 onwards to achieve an additional 250 Gw.”
The government’s power projection indicates India will have to bid out 140 Gw of wind energy to meet the demand by 2030, he said, adding the country would complete bidding of 60 Gw of wind energy by 2020. He further said, “India has already achieved 70 Gw of renewable energy capacity, including 22 Gw of solar and 34 Gw of wind.”
The country would ultimately have around 500 Gw of renewable energy capacity by 2030, including 350 Gw of solar and 140 GW of wind. The secretary believes the capacity addition would give opportunity to domestic renewable energy equipment manufacturers and project developers.
Ultra-low renewable power tariffs, coupled with uncertainties about proposed duties on solar components, pushed the country to the fourth position in the renewable energy country attractive index in a year. Now, it trails China, the US and Germany. A survey of 44 CEOs, conducted by renewable consultancy firm Bridge to India noted in May that most of the leaders in the sector believe developers have been irrationally aggressive while bidding, kumar also said that on request of the renewable industry, MNRE has asked IIM Lucknow to evaluate if the ongoing reverse auction mechanism, where the quotes of the bidders are open to every participant, can be amended.
Power minister RK Singh recently said the country would surpass its target of 175 Gw of renewable energy capacity by 2022, and install 225 Gw of green power capacity as well. Giving a boost to the uptake of renewable energy, the government has raised the minimum quantity of green power states have to mandatorily procure to 21% by FY22 from 14.3% in FY18.
According to industry estimates, achievement of revised targets (225 Gw) would require investments of about Rs 3 lakh crore till 2022. The government has already awarded 7,500 Mw, and another 11,500 Mw is in the pipeline.
By 2030, considering the 6% increase in power demand, the country will need around 860 Gw of installed power generation capacity, of which 350 Gw will come from solar, and 140 Gw from wind units.