The state government of Gujarat recently concluded another edition of its biennial Vibrant Gujarat Global Investors Summit. The summit, once again, witnessed pledges being made for large-scale renewable energy deployment in the state, but these pledges need to be taken with a pinch of salt given the poor track record of such pledges being converted into actual operational power plants.
According to media reports, private and government-owned companies have entered into agreements worth over $14 billion for the development of renewable energy projects across Gujarat. These companies may receive some financial incentives that the government offers to attract investors in the state.
Perhaps the largest commitment has been made by Adani Green Energy, which has proposed to set up the world’s largest solar-wind hybrid park in the state. The hybrid park will entail an investment of Rs 30,000 crore ($4.23 billion). We recently covered this in detail — the company likely plans to set up the park in the Kutch district. The company has already requested the government to provide it access to the grid in order to feed 1.5 gigawatts of wind and 750 megawatts of solar power.
Wind energy major Suzlon Energy has pledged to invest Rs 25,000 crore ($3.5 billion) to set up another hybrid park in the districts of Saurashtra and Kutch. The power distribution utility Torrent Power has pledged to invest 5,235 crore ($740 million) in renewable energy projects, and an additional Rs 3,150 crore ($444 million) to set up power distribution network. Torrent Power recently issued a tender to procure 300 megawatts of solar power to meet its renewable purchase obligation.
Solar Energy Corporation of India, part of the Ministry of New and Renewable Energy, has signed two agreements for wind and solar power projects. Under the first agreement SECI will facilitate setting up 1 gigawatt of offshore wind energy project. The project will entail an investment of Rs 15,000 crore ($1.83 billion) from various private sector developers. The second agreement would see SECI facilitate the auction of 4 gigawatts of solar power capacity for a project planned in Dholera. The total investment for the project is expected to be around Rs 20,000 crore ($2.8 billion). An installed capacity of 5 gigawatts has been planned at the Dholera solar power park. Gujarat has already issued a tender for 1 gigawatt capacity for the park.
Since 2003, when the Vibrant Gujarat Global Summit was first inaugurated, a total of 559 agreements in renewable energy sector have been signed by the investors. However, 307 of those proposals have been dropped. The total pledged investment, excluding the 2019 pledges, has been over $77 billion while the actual investment has been just 7.35% at around $5.7 billion.
Of the 252 projects undertaken by the project developers, 105 have been commissioned, 25 are under development, and 122 projects are in the planning stage. Against a proposed capacity of 58.8 gigawatts, only 6.8 gigawatts is operational.