India’s got big plans for its renewable energy sector.
Welspun Energy Ltd., the nation’s largest solar developer, declared that India would exceed its solar power generation target twice over within the next ten years.
This is the latest in a pattern of energy companies paying increasing attention to renewable power—just last month, India’s biggest wind power developer CLP Holdings Ltd. stated that it will be focusing more on renewable development after noting consistent conventional fuel shortages.
India’s government aims to establish 20 gigawatts of solar power generating capacity by 2022. Welspun, which has been signing numerous agreements over the last year to build 1,500 megawatts of solar power, says that they are more likely to hit 40 gigawatts given the increasing parity between renewable and fossil fuel costs.
Welspun’s 1,500 megwatt installations will likely cost around $1.8 billion.
India has seen explosive economic growth over the past few years with a 9 percent growth rate. However, to maintain that rate, the nation will need to add another 169 gigawatts of power capacity in five years according to the Indian Planning Commission.
The recent economic slowdowns worldwide have affected India’s growth as well; in the three months ending March, GDP rose by 5.3 percent. That is the slowest rate of growth in the past nine years.
Vineet Mittal, managing director of Welspun Energy, told Bloomberg:
“India is different from the U.S. or Europe because renewables aren’t just competing on cost with fossil fuels. It’s a question of energy security.”
And, he says, the fact that renewable energy is innately resistant to disruptions—a common feature of the conventional power infrastructure in India—makes it highly attractive to investors and consumers alike.
Today, 70 percent of India’s power supply comes from conventional fuels—coal, oil, gas—and the supply is frequently unreliable thanks to an aging rail and pipeline infrastructure. Solar and wind power costs have already fallen below that of diesel.
Welspun plans to replace diesel generation units at its group companies with renewable options over the next 18 months.