Month in a Minute: Top Headlines from Indian Renewable Sector in August 2022

India adds over 7 GW of solar in a record first half of 2022


Here is a recap of some of the most important headlines from August 2022:

India installed over 3.9 GW of solar capacity in the second quarter (Q2) of the calendar year 2022, an increase of 18% compared to 3.3 GW installed in the previous quarter. On a year-over-year basis, installations rose by 59% from the 2.4 GW. The latest installation data was revealed in Mercom’s newly released report – Q2 2022 India Solar Market Update. Large-scale solar accounted for 90% of the installations, and rooftop accounted for the remaining 10% during the reporting period.

The Union Cabinet approved the Nationally Determined Contribution (NDC) as part of the global response toward climate change goals as agreed under the Paris Agreement. As per the updated NDC, India aims to reduce the emissions intensity of its GDP by 45% by 2030 from 2005 levels and achieve 50% of total installed power capacity from non-fossil fuel-based sources by 2030. The updated NDC also represents the framework for India’s transition to cleaner energy from 2021 to 2030.

The Ministry of Power (MoP) released its tenth annual integrated ratings for the state distribution companies (DISCOMs) for the financial year (FY) 2022. Out of the 71 DISCOMs covered, six state DISCOMs received A+ ratings. Compared to the previous ratings, 25 DISCOMs were downgraded, while only Assam Power Distribution Company and Tripura State Electricity Corporation improved their ratings. The Eastern and Southern Power Distribution Companies of Andhra Pradesh and Meghalaya Power Distribution Company were downgraded to a new low rating of D.

Power System Operation Corporation (POSOCO) debarred 15 DISCOMs in six states and a Union Territory from buying or selling electricity at power exchanges. POSOCO invoked the Electricity (Late Payment Surcharge and Related Matters) Rules, 2022, to penalize DISCOMs by barring them from buying electricity from alternative short-term sources at the power exchanges.

The MoP suggested creating a central pool of interstate transmission systems-connected renewable energy sources from which an intermediary company will procure power to be supplied to an entity that will undertake distribution and retail supply to more than one state. The ministry proposed that there will be a different central pool for each sector, like solar, wind, hybrid, hydro, small hydropower, and power from any other renewable energy resource, including storage or their combination. The central pool will be constituted for five years. The proposal is part of the draft Electricity (Amendment) Rules, 2022, on which the ministry has invited stakeholders to share comments by September 11, 2022.

India added 430.45 MW of wind power capacity in Q2 2022, a 57% increase over  275 MW installed in Q1 2022. The cumulative wind installations in the country stand at 40.8 GW, according to the recent data released by the Ministry of New and Renewable Energy. The YoY installations increased by 80% compared to 239.6 MW in Q2 2021.

India generated 47.64 BU of solar power in Q1 2022, an increase of 34% compared to the same period last year. In Q2 2022, the country generated approximately 25.41 BU of solar power, a 14% QoQ increase compared to 22.22 BU generated in Q1 2022. The solar power generation increased by 40% compared to 18.12 BU in Q2 2021. The increase in solar power generation may be attributed to the new capacity additions during the year’s first half.

Vikram Solar, a solar module manufacturer and EPC solutions provider, received SEBI’s nod to raise funds through an initial public offering (IPO). The IPO consists of a fresh issue of up to ₹15 billion (~$188.9 million) and an offer-for-sale of up to 5 million equity shares. According to the draft papers, proceeds from the fresh issue will be utilized to set up an integrated solar cell and module manufacturing facility with an annual production capacity of 2 GW.

The government of Uttar Pradesh issued the draft Solar Energy Policy 2022. The policy will be valid for five years. The policy proposes to achieve 16 GW of solar power projects by 2026-27, which would include 10 GW of utility-scale solar power projects, 4 GW of rooftop solar projects, and 2 GW of distributed solar projects. The Uttar Pradesh New and Renewable Energy Development Agency would act as the nodal agency for implementing the proposed policy. Uttar Pradesh had a cumulative installed capacity of 2.3 GW as of Q2 2022 and ranked ninth among states for large-scale installations, according to Mercom India Solar Project Tracker.

India imported solar cells and modules worth $597.48 million (~₹47.39 billion) in Q2 2022, a decline of 22% YoY, according to Department of Commerce data. On a QoQ basis, imports fell by 51% compared to $1.23 billion (~₹92.62 billion). Exports during the quarter decreased 57% to $26.22 million (~₹2.07 billion) compared to $60.58 million (~₹4.8 billion) in the same period last year. On a QoQ basis, exports rose 250% from $7 million (~₹555.1 million).

India installed over 389 MW of rooftop solar capacity in Q2 2022, a decline of 15% compared to 456 MW installed in the previous quarter. Installations fell by 25% from the 521 MW installed in the same period last year. The first half of 2022 saw 845 MW of rooftop solar capacity added, a 2% decrease compared to the same period last year. Around 63% of rooftop solar installations were carried out under the capital expenditures model in Q2 2022. The operating expenditures/renewable energy services companies model accounted for 37% of the projects.

The average cost of large-scale solar projects in Q2 2022 was ₹45.4 million (~$568,536)/MW, according to Mercom’s recently released Q2 2022 India Solar Market Update. The average cost increased by 18% compared to the same period. The cost rose 4.4% from the previous quarter. India installed over 3.5 GW of large-scale solar capacity in Q2 CY 2022, an increase of 23% compared to 2.9 GW installed in the previous quarter. On a YoY basis, installations rose by 82% from 1.9 GW. Large-scale solar accounted for 90% of the installations during the quarter.

Investments in the Indian solar sector in Q2 2022 totaled $2.82 billion (~₹217.49 billion), a 3% increase compared to the $2.73 billion (~₹205.38 billion) in Q1 2022. Investments were up 24.8% YoY compared to $2.26 billion (~₹166.71 billion). The figures were revealed in Mercom India Research’s latest Q2 2022 India Solar Market Update. According to the report, nearly $2.1 billion (~₹160.02 billion) went into utility-scale solar projects and $233 million (~₹17.6 billion) to the rooftop solar segment.


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