Market to watch: India
Contributed by: MEC+
Total wind installations in India are expected to reach between 48GW to 54GW by 2020 – well short of the government’s 60GW target. This implies that new tenders issued will be between 2GW to 3GW per year after accounting for the pipeline already under construction. The sudden decline in the market has taken all stakeholders by surprise as this range is 60 per cent lower than the range expected over the last two years.
The sharp decline in expectations is driven by supply-side bottlenecks mainly attributed to sanctioning of grid and land (See our note in the GWR 2019). GWEC and MEC+ provide a scenario-based foundation for policy action by shedding light on the development of wind installations in India. The report presents three scenarios exploring different development pathways of the India wind industry.
- Low Case = A business-as-usual scenario.
- As-if Case = A scenario that only certain pockets of constraints are resolved.
- High Case = A scenario whereby bottlenecks are opened in 2020 to drive installations during 2021-2022.
These three scenarios open up five realities for stakeholders to consider the thought of installation in India. The interplay of these realities will determine how market volume shapes up:
The government is aware of these realities and has done multiple consultations to resolve the bottlenecks. Some evidence is seen in the resolution of the supply side bottlenecks with the announcement of two new large renewable energy parks, removal of price caps in future auctions and strengthening its agencies to step-in for helping developers.
The future market volume will depend on the extent to which the realities are managed. Nevertheless, stakeholders must take market uncertainties into account while building their India business plans.
India market outlook through 2022: Upcoming webinar and report
In May, GWEC and MEC+ will publish a comprehensive report on the market outlook of the India wind energy sector through 2022. Ahead of this report, we are holding a webinar in April to discuss India wind energy market insights and realities in detail.
To sign up for the webinar on 28 April 2020, please click the button below: