Investment trends in India’s renewable energy sector over the last few years have proven that the market remains of the most attractive and fastest growing clean energy markets in the world.
The Minister of New & Renewable Energy, Piyush Goyal, recently told the Indian Parliament that the country attracted Rs 90,841 crore (around $14 billion) over the last 3 financial years in renewable energy investments, that is, between FY2013–14 and FY2015–16.
The minister also reported that the government provided financial incentives worth Rs 6,541 crore (around $1 billion) during the same period. This financial support includes capital cost support for setting up projects, as well as generation-based incentives for power generation.
The wind energy sector remained the most attractive one for the investors who poured in Rs 46,831 crore (around $7 billion). This was followed by the solar power sector, which received investments worth Rs 30,440 crore ($4.5 billion). Bioenergy projects received Rs 7,382 crore ($1.1 billion) of investment while small hydropower projects attracted Rs 6,187 crore ($0.92 billion).
Over the last few years, investment in the wind energy sector has increased again after the government re-introduced financial incentives such as accelerated depreciation. Annual capacity addition in the wind energy sector has been up since then, increasing to 3.3 GW in FY2015–16. However, investments are likely to fall starting next financial year when the incentives are reduced or withdrawn.
Investment in the solar power sector is expected to increase significantly over the next few years and overtake wind energy as the most attractive sector. Over the next 6 years, India plans to add over 33 GW of wind energy capacity and more than 93 GW in solar power capacity.