NEW DELHI: Fitch Solutions Macro Research released a report which states, India is likely to install 54.7 GW of wind capacity by 2022.India is ambitiously aiming to install 175 GW of renewable energy capacity by the year 2022, which includes 100 GW from solar, 60 GW from wind, 10 GW from bio-power and 5 GW from small hydro power.
The report also mentions the concern about the economic viability of low tariff projects from India’s wind capacity auctions raise the risk that investor appetite will weaken and auctions will be postponed.
“The combination of several challenges in the country’s wind power sector will hit near-term growth momentum, including land availability hurdles, grid access bottlenecks and concerns over the viability of low tender bids. This informs our view that India will add on average 4.5 GW of wind capacity annually between 2019 and 2022, with the aforementioned risks highlighting further downside risk,” the report said.
As per report released by the Ministry of New and Renewable Energy (MNRE) in December 2018, the country pursues to tender a total 20 GW of wind capacity by March 2020, with two-year execution deadlines, in order to expedite enough growth to meet the expansion targets. However, postponements to the application of tendered projects and more muted interest in new auctions will present a substantial hurdle to fulfilling these envisioned expansion plans, the report said.
“Of a total of 2,943 MW tendered by the Solar Energy Corporation of India (SECI) in Gujarat and Tamil Nadu over 2017 – where 42 per cent of total installed wind capacity is located in India as of end-March 2019 – only 825 MW was commissioned as of March 2019,” it noted.
Concerns over the viability of low tender bids and land acquisition issues in Gujarat were key contributors to the slow implementation of the projects, which initially were expected to be commissioned within 18 months, Fitch Solutions said.