India added lowest solar capacity in 2020: Report

NEW DELHI: A report by Mercom India Research said that India added only 3,239 megawatt (MW) of solar capacity in 2020, which is down by 56 per cent in comparison to the solar capacity added in previous year, which was 7,346 MW. The report established that the addition of 3,239 MW of solar capacity was the lowest in the last five years.

According to the report, rooftop installations of remaining 719 MW panels were also down by 22 per cent in comparison to the installations in 2019. It showed that Andhra Pradesh, Rajasthan, and Gujarat emerged as top three states for large-scale solar capacity additions and represented around 51 per cent of India’s total installations in 2020.

Raj Prabhu, Chief Executive Officer, Mercom Capital Group, commented that India’s solar installations in 2020 were the lowest in five years. He said that other top solar markets in the world have experienced positive growth in comparison to India, which experienced one of the most stringent lockdowns in response to the pandemic. However, he added that the industry in India is expected to experience significant positive growth in 2021, with over 10 gigawatt (GW) of solar installations.

The report outlined difficulty faced by government agencies in getting distribution companies (DISCOMs) to sign power sale agreements (PSA) as an additional challenge in the market besides the COVID-19 pandemic. This bottleneck in the market has left about 17-18 GW of projects without a PSA. Other short-term challenges mentioned in Mercom India’s analysis included rise in module prices, increased shipping and freight charges, which have increased to the range of 500 per cent to 800 per cent, and a surge in costs of raw materials. The report added that as a result, the average large-scale solar project costs have increased by 2 per cent, quarter-over-quarter in October-November 2020.