India To Achieve 76% of Renewable Energy Target by 2022: Wood Mackenzie
World's leading research and consultancy firm, Wood Mackenzie said in a report that India is set to achieve 76% of its Renewable energy target by 2022
India may achieve about 76 per cent of the target of having 175 gigawatts of renewable power generation capacity by the scheduled date of 2022 as it faces myriad challenges, Wood Mackenzie said Monday. The report is the latest in a series, that includes a report from leading ratings and research agency CRISIL too, that India may not hit its targets.
India is targeting 100 GW of solar capacity and 75 GW of wind power by 2022.
“Even with significant cost declines, Wood Mackenzie expects about 76 per cent of the target to be met by 2022 and this would still be a noteworthy achievement,” the world’s leading research and consultancy firm said in a report.
Wood Mackenzie analysts point out to the various challenges the renewable industry is facing. Recent cancellations, various duties like Safeguard Duty has had weakened the investor confidence in the sector which has been doing well for past 2 years. It did add that if the government continues to support the sector through its policies, it will eventually remove the project risks.
Nonetheless, the government’s commitment and support towards renewables has remained strong.
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The government adaptable response to various industry hurdles is helping reduce project risks, as a result, renewable prices continue to remain competitive.
Wood Mackenzie report says combined wind and solar capacity have almost doubled from 2014 levels to 61 GW this year. The experts at the Wood Mackenzie did add that significant decline in the cost is behind the growth. Capital costs are further expected to fall in the next five years.
- capital costs are expected to decline by 23 per cent for wind and 31 per cent for solar
Wood Mackenzie expects non-hydro renewables energies will make up for 13 per cent of power generation mix by 2023.
Improving grid flexibility through storage and flexible power generation will be extremely crucial in achieving high levels of renewable penetration, it said, adding that economic competitiveness, technological maturity, and financially healthy off-takers will provide a solid base for renewable capacity growth to cater to electricity demand growth.
Forecasts for 2040, the Wood Mackenzie analysts say that India is to increase its renewable capacity around seven times to 384 GW driven by diverse sub-segments which include offshore wind, hybrid projects, floating solar and distributed solar. The 384 GW of non-hydro renewables will ultimately contribute 20 per cent of generation share by 2040.
Coal
On the blip side, Wood Mackenzie, said coal will remain principal energy driver in the near term.
Its coal principal analyst says that Wood Mackenzie sees increase in India’s imports for thermal coal from 158 million tonnes to 164 million tonnes in 2018 with a further upside risk of 3-4 million tonnes as the principal, and world’s largest cola miner, Coal India Limited, continues to struggle to increase output.
In February, Wood Mackenzie said that Oil demand will also stay strong till 2030. Even though India aspires to sell at least 30% electric vehicles by 2030, it still sees gasoline and diesel consumption doubling over that period.
Electric vehicles will take time to become affordable enough for price-sensitive Indian masses, according to the country’s energy forecaster. During that time, gasoline and diesel vehicles will remain the mainstay as cars and scooters sold in the next few years will stay roadworthy for at least a decade after.
In addition, while the electric vehicle goal has been spoken of by various minister and states like Kerala and Uttarakhand have rolled out their policies. However by Prime Minister office, it hasn’t been formulated into an official policy yet.
Also Read: China, India fast becoming the twin engines of renewable growth
