India added 1.4 GW of solar in October-December period

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A new report by the CEEW Centre for Energy Finance (CEEW-CEF) reveals India’s grid-scale solar capacity addition during the third quarter (October-December period) of FY 2020-21 stood at 1125 MW. This is more than double the 529 MW grid-scale capacity added in the previous quarter (July-September).

Rooftop solar addition during the quarter was 289 MW. 

Overall, the nation added 1414 MW of solar from utility-scale and rooftop projects combined, compared to 928 MW installed in the previous quarter (July-September).

Solar continued to dominate, accounting for 73% of the 1.9 GW RE capacity (grid-scale solar, rooftop solar, wind and biomass/other RE sources) added in Q3 FY21.

Arunabha Ghosh, chief executive officer, CEEW, said, “India offers one of the largest renewable energy markets operating on market principles. The performance of the RE sector in this quarter has further reiterated the promise the sector holds. To meet the 450 gigawatts renewables target, India needs investments worth more than USD 200 billion for generating capacity alone. Significant additional funds will be required for supporting infrastructure such as storage and transmission. The focus must now be on reducing the cost of finance and embracing innovative financing models such as a time-bound credit enhancement scheme to accelerate the growth of the sector.” 

The report also indicated a decline in quarterly capacity auctioned, with 2.97 GW RE capacity auctioned in Q3 FY21, compared to 4.4 GW in Q1 FY21 and 3.2 GW in Q2 FY21. 

“This might be due to challenges faced by the Solar Energy Corporation of India (SECI) in finding adequate buyers for the previously tendered (higher tariff) capacities in the face of rapidly declining tariffs and discoms’ grid integration,” it reasoned.

Nikhil Sharma, Associate, CEEW-CEF, said, “SECI needs to ensure power purchase assurance with discoms to attract bidders and provide an upside of the rapidly declining tariffs to discoms to regain momentum in the quarterly capacity auctioned.”

On the discom payables front, there was only a 1% increase in overdues in Q3 FY21, compared to a 30% spike in Q1 FY21. As of December 2020, the amount overdue by discoms was INR 1.43 lakh crore. 

 

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