Upbeat on the improved regulatory and financial environment, investors are expected to pour over $15 billion into India’s wind energy sector by 2020, a report by ratings and research firm CRISIL has stated.
CRISIL expects that India will add 4 GW wind energy capacity every year over the next 5 years, translating into a total investment of over $15 billion. The firm stated in a recent report that the feed-in tariffs for wind energy projects has declined significantly and were fast approaching grid parity which would attract fresh investors to the sector.
It is noticeable that India has never added more than 3.2 GW wind energy capacity in a financial year. The Indian Wind Turbine Manufacturers Association expects that 3.5 GW capacity would be added in this financial year.
The Indian government has pledged the continuation of critical incentives for the wind energy sector, such as accelerated depreciation and generation-based incentive. The government is also planning to launch the National Wind Energy Mission which would accelerate the development of wind energy projects and open the offshore wind energy sector as well. The government is also expected to push utilities to procure more renewable energy.
These initiatives by the government have already started to reap results. Indian and international project developers have pledged to add over 47 GW of new wind energy capacity by 2022. The Indian government has set a target to install 60 GW worth of wind energy capacity by 2022. This means that around 37 GW capacity would have to be added by March-end 2022.