A new report by ICRA says large-scale solar in the country will likely achieve the 60 GW target set by the Indian government. Rooftop solar and wind, however, will see a shortfall.
India will reach a cumulative renewable energy capacity of 120-125 GW by December 2022. This will include 50% from solar, 38% wind and the balance from other sources—according to ICRA analysts.
The analysts expect utility-scale solar capacity to achieve the 60 GW target set by the government. Rooftop solar and wind power segments, on the other hand, will see a shortfall.
Sabyasachi Majumdar, Group Head & Senior Vice President-Corporate ratings, ICRA, said, “While [the 120-125 GW estimate] is lower than the capacity target of 175 GW set by the Government of India (GoI), the incremental capacity addition is estimated to be healthy at 33-38 GW with investment outlay of more than Rs 2 lakh crore over the next two-and-a-half years.”
ICRA expects this to be supported by a large pipeline of projects awarded by central nodal agencies and state distribution utilities (discoms) and likely improvement in execution timelines.
ICRA expects RE capacity addition to remain subdued at about 8 GW in FY2021, given the continued execution challenges amid Covid-19, because of disruption of supply chain as well as labour availability issues.”
“7.5-8 GW RE estimate for FY 2021 will comprise 5-5.5 GW solar (mainly utility-scale) and about 2 GW of wind energy,” according to Girishkumar Kadam, Sector Head & Vice President – Corporate Ratings, ICRA.
Nonetheless, ICRA expects the overall medium- to long-term investment outlook for the renewable energy sector to remain strong supported by highly competitive tariffs, policy support and new schemes such as peak supply, round-the clock supply and RE plus thermal blending.