With the addition of 145 gigawatt (GW), India is forecast to almost double its renewable power capacity over 2022-2027. Solar photovoltaic (PV) accounts for three-quarters of this growth, followed by onshore wind with 15 per cent and hydropower providing almost all the rest.
Two policy measures that India has adopted to promote domestic manufacturing in the solar PV sector include the PLI scheme and raising import duties on modules.
Almost a quarter of the capacity awarded since 2021 has been contracted through hybrid auctions. These auctions are thus expected to be an increasingly important growth driver as the penetration of wind and PV technologies in India’s power system grows and grid integration challenges emerge.
Clean energy transitions are driving down the costs of energy storage technologies, expected to reduce further with an increase in scale and innovations.
Policy changes in the wind energy sector were also made to accelerate the transition to renewables.
Wind energy is a different ball game compared to solar because the good sites are only located in coastal states. Even within a coastal state, there are tier 1, tier 2, and tier 3 sites depending on the wind intensity.
To this end, improving the financial performance of DISCOMs and increasing penalties for non-compliance with renewable purchase obligations should limit delays in signing PPAs with auction winners, making developers and investors more willing to undertake new utility-scale projects.
In addition, offering DISCOMs financial and regulatory incentives to increase rooftop PV deployment in their grids should encourage them to attract tens of millions of potential prosumers by facilitating investment, thereby tripling main-case distributed PV deployment for 2022-2027.