Brighter days await renewable energy space; investments likely to cross $15 billion in 2022

India, which has an installed renewable energy generation capacity of a little over 150GW, aims to reach 175GW in 2022.

December 24, 2021 11:55 am | Updated 12:03 pm IST - New Delhi:

Union Minister R.K. Singh. File

Union Minister R.K. Singh. File

After witnessing cloudy skies this year, the country’s renewable energy sector is expected to boom with a likely investment of over $15 billion in 2022 as the government focusses on electric vehicles, green hydrogen, manufacturing of solar equipment as well as achieving the ambitious 175GW renewable capacity target.

India, which has an installed renewable energy generation capacity of a little over 150GW, aims to reach 175GW in 2022. Out of the total mix, 100GW would be from solar, 60GW from wind, 10GW from bio-power and 5GW from small hydropower projects.

Also read | India’s 450GW renewable energy goal by 2030 doable, says John Kerry

“In 2022, we expect the investment in renewable energy to cross at least $15 billion,” Union Minister for Power and New and Renewable Energy R. K. Singh told PTI .

According to Bloomberg New Energy Finance (BNEF) reports, new investment made in the clean energy sector in the country stood at $6.2 billion in 2020, $9.3 billion in 2019 and $10.8 billion in 2018. These figures were cited by the Minister in a written reply in the Rajya Sabha last month.

The second wave of COVID-19, which started in April, had impacted implementation of various renewable energy projects as States imposed restrictions to curb the spread of infections.

During the 2014-2019 period, renewable energy programmes and projects in India attracted investments of $64.4 billion, as per REN21 Renewables 2020 Global Status Report.

Nevertheless, in 2021, new opportunities emerged. Indian companies have started exploring overseas markets to raise funds and in August, ReNew Power became the first Indian renewable energy company to list on Nasdaq.

Comment | A clean energy transition plan for India

Data from the Department for Promotion of Industry and Industrial Trade (DPIIT) showed that Indian ‘Non-Conventional Energy’ sector received about $7.27 billion as FDI from 2014-15 up to June 2021. Out of the total amount, FDI to the tune of $797.21 million came in 2020-21.

On the country’s march towards achieving the renewable energy capacity of 175GW in 2022, the Minister said, “We will achieve the 175GW of renewable energy capacity target which was set by us (excluding large hydro).” In November, Mr. Singh said, the country achieved an installed capacity of 150GW of renewable energy, including large hydro projects. There is 63GW of renewable energy capacity which is under installation, which is expected to be completed next year, he noted.

At COP 21, as part of its Nationally Determined Contributions (NDCs), India committed to achieving 40% of its installed electricity capacity from non-fossil energy sources by 2030. India has achieved this target in November 2021 itself.

As on November 30, the country’s installed renewable energy capacity stood at 150.54GW, comprising solar (48.55GW), wind (40.03GW), small hydro power (4.83GW), bio-power (10.62GW) and large hydro (46.51GW). The nuclear energy-based installed electricity capacity is at 6.78GW.

Together, the non-fossil-based installed energy capacity is 157.32GW, which is 40.1% of the total installed electricity capacity of 392.01GW.

India aims to have 500GW of installed renewable energy (RE) capacity by 2030.

Also read | India needs to tap hydro resources to achieve 500GW renewable energy capacity target: Power Minister R. K. Singh

Talking about boosting investments in the RE space, Mr. Singh said, “We have also opened the gates for installation of RE and selling it through open access. Now, anybody can set up RE capacity and sell it wherever it wants.” In 2021, the government introduced the production linked incentive (PLI) scheme ‘National Programme on High Efficiency Solar PV Modules’ with an outlay of ₹4,500 crore to support and promote manufacturing of high efficiency solar photo voltaic (PV) modules.

These include the upstage vertical components such as cells, wafers, ingots and polysilicon. The initiative is expected to reduce import dependence in the solar PV sector.

Pursuant to the decision, a tender inviting bids for manufacturing of high efficiency solar PV modules was issued. As many as 18 bids were received and that could help add another around 55GW of solar PV module manufacturing capacity to the present capacity of around 11GW.

Letter of Awards have been issued by IREDA to three successful bidders for setting up 8,737MW capacity of fully-integrated solar PV manufacturing units. The government has plans to increase the allocation of the PLI scheme to ₹24,000 crore.

As on November 30, 52 solar parks have been sanctioned with a cumulative capacity of 37.92GW in 14 States. Solar power projects of an aggregate capacity of around 9.2GW have already been commissioned in these parks.

Under the rooftop solar programme Phase-II, a total of 5.7GW solar capacity has been set up as on November 30. Against the target of 4GW for residential sector under Phase-II, allocation of 3.4GW has already been made to various States/UTs and 1.07GW has been installed.

About 8,434ckm (circuit kilometres) of intra-State transmission lines have been constructed and 15,268 MVA intra-State substations have been charged under the green energy corridor for evacuation of RE.

In his Independence Day speech this year, Prime Minister Narendra Modi announced the launch of the National Hydrogen Mission.

The goal is to make India a global hub for green hydrogen production and exports. The draft National Green Hydrogen Mission document is under inter-Ministerial consultations.

Under the 12GW grid-connected solar PV power projects by Central Public Sector Undertakings (CPSUs) with domestic cells and modules, the government has sanctioned around 8.2GW projects as of November 30.

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