Solar Energy only power source to grow YOY in FY18; Capacity additions declined among thermal and wind sources

Renewable energy capacity additions continued their upward momentum in India reaching 20.32% of India’s total capacity mix at the end of financial year 2017-18 compared with 17.5 % a year ago largely aided by solar capacity additions that saw a jump of 89% year on year.

According to Mercom Communications India, a subsidiary of Mercom Capital Group, at the end of FY18, the country’s total installed power generation capacity was 345,000 MW with renewables accounting for 70,000 MW or 20.32%. This was a 2.8% share increase over fiscal year 2016-17, which had cumulative renewable energy installations of 57,000 MW, or 17.50% of the total energy mix.

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Due to increase in installation activity, solar accounted for over 22,000 MW of the total installed capacity, representing 6.59% of overall capacity. “Solar recorded the largest increase with capacity installations rising 89% YOY. The share of solar capacity grew from 3.76% as of March 2017 to 6.59% as of March 2018,” Mercom said.

However, wind power currently accounts for over 34,000 MW of total installed capacity and 9.87% of overall power generation. Wind installations declined in 2017-18, adding less than 2000 MW in capacity additions, a decline of 68% YoY. The slowdown in installation activity can be blamed on the transition from a feed-in-tariff system to reverse auctions, the cosulting firm said.

Recently, the Solar Energy Corporation of India (SECI) auctioned 2000 MW of Interstate Transmission System (ISTS)-connected wind power projects under Tranche-IV, increasing the pipeline of new wind projects considerably. However, these projects will take some time to be installed.

Hydro power comprised around 13.12% with 45,000 MW of the capacity added in the country. In the previous financial year, hydro made up 13.61 percent. Capacity installations declined by 52% YoY.

The cumulative installed capacity of small hydro increased moderately with 4500 MW of total installed capacity. The percentage share of small hydro in the energy mix has remained the same.

Nuclear power has a total capacity of 6,780 MW and makes up 1.96% of total capacity.

Despite the increase in renewable capacity addition, coal-fired capacity still dominates overall and accounts for 57.14% of India’s total installed capacity.

Coal was the second most installed energy source but capacity addition in FY18 was less than half of solar with around 5,000 MW of capacity installation compared with 10,000 MW of solar installations. Coal additions declined by 28% YoY in FY18.

The consulting firm believes by the end of FY18, the renewable energy numbers should have been more than where it stands currently. A slowdown in wind installations was the primary reason behind it.

- TradeBriefs Bureau -