The rapid growth in renewable energy sector in India will easily overtake that in the thermal power sector and would result in more renewable energy capacity being operational than thermal power capacity by 2027, the latest economic survey of the Indian government has stated.
The recent economic survey released by the Indian government states that by 2026 installed capacity in the renewable energy sector will match that in the thermal power sector. In the following year, renewable energy will become India’s largest power sector, in terms of installed capacity.
Thermal power capacity at present contributes 55% to the total installed capacity of 327 gigawatts, while the contribution of renewable energy is 18%. However, renewable energy has already started to overtake thermal power capacity in terms of monthly and quarterly capacity addition.
“India added more renewable energy capacity than thermal power capacity in financial year 2016-17, the Central Electricity Authority of India has reported. The renewable energy capacity added during the period April 2016 to March 2017 was nearly twice as much as the thermal power capacity added during the same period.
“A total of 6,990 megawatt coal-based power capacity was added in India in FY2016-17 while the thermal power capacity addition during the financial year stood at 7,655 megawatts. In comparison, 14,140 megawatts of renewable energy capacity was added in the same period.
“Wind and solar power were the largest contributors among the renewable energy technologies in terms of capacity addition in FY2016-17. A total of 5,413 megawatts of wind energy capacity was added, the highest-ever in India’s history. Solar power capacity addition stood at 5,526 megawatts, also the highest-ever in India.
“The share of renewable energy capacity in India’s total installed capacity increased from 14.2% at the end of FY2015-16 to 17.5% at the end of FY2016-17. India targets 40% share of renewable energy technologies in the installed capacity mix by 2030.”
The sharp fall in solar and wind energy tariffs in competitive auctions is among the reasons for the rapid rise in renewable energy capacity addition. Tariffs of new solar power projects are now cheaper than a huge majority, 92%, of coal-based power projects.
“The government-owned NTPC Limited owns more than 42.7 gigawatts of thermal power capacity based on coal and gas. According to reports, the average tariff for these projects is Rs 3.20/kWh (5.6¢/kWh), about 24% higher than the lowest solar power tariffs.
“According to the data for 2014-15, there are 248 thermal power plants in India based on a variety of fuels including coal, lignite, imported coal, diesel and different forms of petroleum-based fuels. The new low of solar power tariffs – Rs 2.44/kWh – is less than the tariff of 227 of the 248 thermal power plants.”