Comments
A policy revamp could help accelerate implementation of renewable energy projects such as solar and wind power, while lowering cost of implementation, the US-based Climate Policy Initiative and Indian School of Business say.
Their report suggests the cost of support can be further reduced by accelerating wind deployment in the near term and gradually ramping up solar deployment.
In an analytical study ‘Reaching India’s Renewable Energy Targets Cost-Effectively’ conducted by CPI and ISB, it observes that with appropriate policies, the Budget 2015 target of 60 GW of wind power by 2022 can be achieved with minimal government financial support.
The report observes that the Centre can save on solar incentives by adjusting current policy. Compared to imported coal, the cost of wind power is already competitive, thus requiring no additional support, and the cost of solar power will be competitive by 2019. The Government support could be reduced by offering extended tenor debt.
Wind power India aims to install 60 GW of wind power capacity and 100 GW of solar power capacity by 2022, which is more than six times the current installed capacities of approximately 22 GW and 3 GW, respectively.
The cost of electricity from imported coal is taken as the baseline for this comparison because this is the fuel, rather than domestic coal or natural gas, that renewable energy is likely to replace. While natural gas is the most expensive fossil fuel, it has very limited availability. Imported coal is the next most expensive fossil fuel, and is also projected to account for 18 per cent of India’s total generation, higher than India’s target of 15 per cent of generation from renewable energy by 2020.
Compared to imported coal, the cost of wind power is already competitive, thus requiring no additional support, and the cost of solar power will be competitive by 2019, it is expected to be cheaper than imported coal-based plant.
The solar capital costs are expected to come down while fossil fuels become progressively more expensive to run plants.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.