New Delhi: India’s addition is set to grow by up to 76 per cent to 3,000 Megawatt (Mw) in the current financial year (2018-19) from around 1,700 Mw added last fiscal. "The project awards so far are expected to increase the capacity addition to about 2.5-3 GW in FY2019 from 1.7 GW in FY2018. As for the increase in bid tariffs, it is partly because of some increase in equipment pricing, additional evacuation cost and rising cost of funding," said Girishkumar Kadam, vice-president at ratings agency . He, however, added the ability of the nodal agencies to achieve the target wind project awards of 10 Gw each in Financial Year 2019 and 2020 remains a challenge in view of the difficulties being faced by developers in securing connectivity and to inter-state transmission network. The sector has witnessed project awards of 10 Gw between February 2017 and September 2018 by central nodal agencies Limited (SECI) and Ltd (NTPC) as well as state distribution utilities. This has provided a visibility for substantial wind-based capacity addition in 2018-19 and 2019-20. The bid tariffs discovered in the recent auctions increased slightly from a low of Rs 2.43 per unit to Rs 2.77 per unit discovered during August 2018 to September 2018, though continuing to remain less than Rs 3 per unit. While the wind energy bid tariff levels are still competitive as compared to conventional energy sources, the viability of such tariffs depends on the developers’ ability to identify locations with high generation potential, availability of long-tenure debt at cost competitive rates and capital cost. The generation performance of wind-based Independent Power Producers (IPPs) was constrained by poor wind season in 2017-18 with many wind assets reporting Plant Load Factor (PLFs) below the expected level. However, wind power generation has improved in the current fiscal. Generation from wind-based capacity at an all-India level increased by 21 per cent in the first six months of the current fiscal as compared to the corresponding period last fiscal. This increased generation came despite the slowdown in addition of new capacity in 2017-18 and the first half of 2018-19. The payment cycle by the discoms remain mixed across states with visible improvements seen in utilities in Rajasthan post the implementation of UDAY as well as in Maharashtra recently. “The significant improvement in payment cycle by the utility in Maharashtra as reflected from current overdue receivable position of about one-month period (from the earlier level of 8-10 month) aided by efficiency improvement measures remains a positive development for the wind IPPs," Kadam said. The Maharashtra Electricity Regulatory Commission (MERC) in a recent order asked for clearing the outstanding dues including delayed payment charges in a timebound manner.
India's wind energy sector is set to expand capacity 76% to 3 GW by the end of the 2018-19 fiscal year, according to Girishkumar Kadam, VP of ratings agency ICRA. The target of deploying 10 GW in 2019 and 2020 faced headwinds, including access to interstate transmission networks. India has been a net importer of electricity for more than two decades, but its domestic demand grew at an average annual rate of about 5% from 2011 through 2016, said Ajay Mathur, chief executive officer of India's national wind-based energy generation increased 21% during H1, YoY, despite the drop in new capacity.