Top Developments that Influenced Hybrid and Wind Power Market in 2022

The government amended bidding guidelines for wind-solar hybrid projects


The year 2022 saw heightened interest in hybrid power projects in the country. India has approximately 1.3 GW capacity installed under hybrid power projects and about 11 GW in the pipeline across the country, according to Mercom India Research.

Top developments in the hybrid power sector

States like Rajasthan, Karnataka, Andhra Pradesh, Gujarat, and Haryana have seen the most hybrid project developments. While other states are slowly picking up pace, the segment has a lot of ground to cover.

In a significant development, the Ministry of New and Renewable Energy (MNRE) amended the guidelines for tariff-based competitive bidding for grid-connected wind-solar hybrid projects.

According to the amendments, if there is a delay in the operationalization of long-term access by the central or state transmission utilities or if there is a delay in the readiness of the intrastate or interstate transmission system-connected substation at the delivery point, the projects will be eligible for a time extension.

The Ministry of Power proposed 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 further said each sector would have a different central pool, like solar, wind, hybrid, large and small hydropower, and power from any other renewable energy resource, including storage or their combination. The central pool will be constituted for five years.

Top Developments in the Wind Sector

India can add 23.7 GW of wind capacity by 2026 with supportive policies and dialogue between the central and state governments, according to the ‘India Wind Energy Market Outlook 2026,’ jointly published by the Global Wind Energy Council and MEC+ Intelligence.

With the demand for energy from renewable sources growing, wind power, along with solar and energy storage, will play a critical role in the future.

Last month, MNRE issued a draft tender to select wind power developers for leasing sea-bed areas to develop 4 GW of offshore wind power projects off the coast of Tamil Nadu. The energy generated from offshore wind power projects will be for sale through open access, captive, bilateral, third-party, or merchant sale modes.

The draft tender follows Union Minister for Power and New & Renewable Energy R.K.Singh’s announcement that bids would be issued for offshore wind energy blocks of 4 GW annually for three years.

A Danish-Indian collaborative study, which aims to support India’s 30 GW offshore wind target by 2030, identified fifteen zones for the first offshore wind development project. The study was released by the Centre of Excellence for Offshore Wind and Renewable Energy, a joint initiative between the Danish Energy Agency and MNRE.

The offshore wind sector in India is still in its early stages, and several challenges will have to be overcome to achieve the target of 30 GW by 2030. These include the need to develop the necessary infrastructure and supply chain, as well as to address regulatory and financial barriers.

The government also announced that it was contemplating pooling bids across the states to boost wind energy installations which have fallen off since 2017. Falling tariffs under the reverse auction regime have pushed developers to bid only in the high plant load factor (PLF) states of Gujarat and Tamil Nadu. The concentration of development in Gujarat and Tamil Nadu has led to a scarcity of potential wind sites in the two states. The other states were neglected because developers could not bring the power cost under ₹3 (~$0.036)/kWh due to lower PLF.

Further, MNRE issued the draft ‘Policy for Repowering of the Wind Power Projects, 2022.′ The policy intends to facilitate the optimum utilization of wind turbines below 2 MW whose design life is completed by maximizing their energy yield per square kilometer of the project area by deploying state-of-the-art onshore wind turbine technologies.

The Ministry of Power issued the renewable purchase obligation (RPO) and energy storage obligation (ESO) targets until the financial year 2029-30, which specified that wind RPO would be met only by energy produced from wind power projects commissioned after March 31, 2022.

The government has also been giving some attention to phasing out e-reverse auctions in the wind sector. The government decided to consider alternative options for e-reverse auctions following complaints from the industry that it leads to unviable tariffs due to unhealthy competition.