NOT SO GREEN. Industry experts flag delays in PPA signing, implementation hurdles

 

GOAL AHEAD. The wind industry is looking at annual installations of 10 GW, two years from now

Bhupinder Singh Bhalla, Secretary, Ministry of New and Renewable Energy, is all smiles, when he says that in 2023-24, renewable energy capacity auctions came up to a record 70 GW, based on which he foresees a bright future for the Indian renewable energy sector.

Speaking at the Global Wind Day celebration held in Delhi on Saturday, Bhalla said that the Ministry had scheduled auctions of 50 GW for the year, but, ended with 52. State governments auctioned another 17 GW, and there were some auctions of private energy buyers, all addingup to a juicy 70 GW.

 

PERSISTING ISSUES

The secretary said that the wind industry could be looking at annual installations of 10 GW, two years from now. 

The renewable energy industry, has welcomed the high level of auctions with caution. According to Parag Sharma, President, Wind Independent Power Producers Association (WIPPA), told businessline, that while projects were being awarded, power purchase agreements (PPAs) were not being signed. Energy companies (called ‘developers’) quote a tariff at which they will sell energy; the bidders are those who quote low tariffs. Once the winners are decided, then the bidding agency (such as the government company, SECI) signs a PPA with the winners. The PPA is a critical document, based on which the developer would raise funds. PPAs for about 40 GW of renewable energy projects are pending signing, Sharma told businessline.

Some delays are also caused by the regulator, C ERC, giving its approval for the tariffs discovered by the auctions, one industry insider said.

The PPA issue aside, there are also difficulties in implementation. Sumant Sinha, Founder, Chairman, and CEO of the renewable energy company, ReNew, pointed to difficulties such as getting land, securing right of way to bring in heavy materials, such as blades in long trailers, and the rising cost of ‘balance of plant’.

BoP costs have gone up 40-50 per cent, in the last two to three years, Sinha said, at the Global Wind Day deliberations.