Page 59

Energética India | September / October 2015

debt: equity ratio of 80:20 in lines with international practice 7. Push for strengthening the SME sector by encouraging them to invest into RE projects for their captive use, this will help in freezing their energy costs and thereby make them competitive , by giving an interest rebate of 5% on the investment made. This will truly transform India and would be a successful Make in India 8. GST for RE projects should be set at zero rate, this will lead to reduction in cost of energy and make RE affordable to utility & consumers Policy action has been reinforced by corporate backing. The Indian Government has secured pledges from 213 companies to set up renewable energy capacity of 266 gigawatts (GW) over the next five years with special focus on reducing the cost of energy (COE). The National Action Plan on Climate Change (NAPCC, 2008) envisages a dynamic RPO target of 10% at the national level for 2015 with an annual increase of 1% so as to reach around 15% by 2020. With a target of 15% increase in output by 2020, India is working towards becoming the leading destination for investment in this sector. Looking at the positive corporate backing on the policy action front, RBI has also recently proposed a revised guideline on loans to renewable energy sector bringing it under the ambit of priority sector lending. Investments in the Indian wind market have been volatile with sporadic inflows. The in-consistencies of the government policies at the state and central level have created road blocks for the growth of the renewable energy. This can be clearly analyzed from the fact that the wind energy generators who invested more than INR 20,000 crore ($3.9 billion) in wind energy were able to add 3,200 MW of wind capacity in financial year (FY) 2013–14. In FY 2012–13, wind energy capacity additions reduced to 1,700 MW while RENEWABLE ENERGY investments amounted to Rs 9,700 crore ($1.8 billion) due to rollback of key Government fiscal incentives like accelerated depreciation (AD). Supported by the reintroduction of generation based incentives (GBI) in September 2013 and reinstatement of accelerated depreciation, investments led largely by independent power producers increased the wind capacity to 2300MW by 2014-15. The fluctuating market investment therefore highlights that a stable policy regime is crucial to realizing the country’s enormous wind energy potential. The Indian Wind market is poised for rapid growth. Market size is expected to grow from 2000 MW in FY 14 to 4000 MW in the next 3 years and register a 20% growth annually. Though, policy amendments definitely provide the required push for the growth of the renewable energy sector, I hope very soon this sector becomes selfsustained in India without major dependence on government subsidies 57 energetica INDIA · SEP | OCT15


Energética India | September / October 2015
To see the actual publication please follow the link above