Indian Government Grows More Aggressive On RE Targets

India is running the most impressive renewable energy program in the world. The country has an installed renewable energy capacity of about 80 GW currently, and has plans to further install 500 GW by 2030, as part of its clean energy drive. It is estimated that the country would need $80 billion in funds until 2022 for its future RE investments.

Given its recently increased target of 500 GW of renewable energy capacity installation by 2030, it is further estimated that funds to the tune of $250 billion would be required during 2023-30. There is thus, investment opportunities for over $30 billion per year for the next decade and beyond. A pro-renewable energy government at the Center and the promise to provide affordable electricity to the masses act as strong tailwinds for faster adoption of renewable energy in the country.

OPEC, which accounts for around more than 80% of India’s total crude oil imports is also cutting down its production. India thus needs to strengthen its renewable energy footprint to compensate for the lost energy and gear up an aggressive roadmap for the installations.

Pro-active measures by the government in the Pipeline

In order to further ramp up installations, the MNRE has asked the RBI to remove the limit on priority sector lending for the renewable energy sector. If implemented, this would encourage the public sector banks to lend more for renewable energy projects. The ministry has also asked the financial institutions and banks to recognize renewable energy as a separate sector different from the power sector. To remove hurdles from the matter of land acquisition, the ministry has assured that SECI would tie up with the respective state government. There will be no upfront payment for the land as it would be on a lease. In a bid to further streamline the processes, the ministry has also promised to implement corrections of duty structure around GST, inverted duty model, and approval scheme for capital subsidy.