Mercom Research revises annual solar installation forecast, down to 7.3 GW for 2019

V Rishi Kumar Hyderabad | Updated on November 21, 2019

Solar installations in the country increased by 44 per cent in Q3 2019, reaching 2,170 MW (2.2GW), compared to 1,510 MW in Q2 2019.

Installations were up by 36 per cent year-over-year (YoY) compared to 1,592 MW in Q3 2018.

However, solar installations in the first nine months (9M) of 2019 reached 5.4 gigawatts (GW), a decline of 19 per cent, compared to 6.7 GW of capacity added in 9M of 2018, according to the newly released Q3 2019 India Solar Market Update by Mercom India Research.

In Q3 2019, large-scale installations totalled 1,925 MW compared to 1,218 MW in Q2 2019 and 1,157 MW in Q3 2018. The large-scale solar project development pipeline for the country has increased to 22.6 GW. About 37 GW of solar have been tendered and were pending to auction at the end of the quarter.

Rooftop solar installations declined by just 16 per cent quarter-over-quarter in Q3 2019, a total 245 MW compared to 292 MW installed in Q2 2019. Rooftop solar installations fell by 44 per cent YoY compared to 435 MW installed in Q3 2018.

Raj Prabhu, CEO and Co-Founder of Mercom Capital Group said: “Solar installations in Q3 2019 beat the downward trend seen over the past five quarters; however, we are revising our forecast down for 2019 as over 1 GW of projects have been delayed. The rooftop market continues to be weak amid a lack of financing and consistent regulatory issues.”

Revision in forecast

The report attributes the revision in the solar forecast to the slowdown in rooftop solar installations, partial commissioning of large-scale projects, and over a gigawatt of projects that were scheduled to be commissioned in the third and fourth quarters getting pushed to 2020 due to legal issues, land acquisition problems, execution delays, tariff approvals, and AP state Issues – policy instability, and access to financing.

Total power capacity additions in 9M 2019 were 13 GW in India from all power generation sources. Of this, renewable energy sources accounted for nearly 56 per cent of installations, with solar representing 41.4 per cent of new capacity and wind with 13.6 per cent. Coal accounted for almost 44.1 per cent of new capacity in 9M 2019.

According to the report, India’s cumulative solar installations stood at 33.8 GW by the end of Q3 2019. However, rooftop installations still only made up 12 per cent of the total. Because of the liquidity crunch and worsening economic conditions, commercial and industrial companies are struggling to finance rooftop projects. The country has crossed 4 GW of cumulative rooftop solar installations and achieved only 10 per cent of the 2022 target of 40 GW.

Mercom has revised its solar forecast down to 7.3 GW for capacity additions in Calender Year 2019 from the previous estimate of 8 GW. Mercom is estimating about 10 GW of installations in Calender Year 2020, assuming stable market conditions.

Tamil Nadu was the top state for large-scale solar installations in Q3 2019, followed by Rajasthan and Karnataka. Large-scale solar installations were mostly concentrated in five states, which made up 96 per cent of installed capacity in the quarter.

Solar accounted for 41.4 per cent of the new power capacity additions in 9M 2019

Renewable energy capacity additions continue to increase at a significant pace in India, accounting for approximately 35.7 per cent of India’s cumulative power capacity mix.

Solar electricity generation crossed 10 billion units (BUs) in Q3 2019.

In the same quarter the investments in the Indian solar sector were 11 per cent lower compared to investments made in Q2 2019

Published on November 21, 2019

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