Renewable sources lag in energy production, total electricity generated by green sources in country less than 7%

Renewable energy which has witnessed rapid capacity addition in the last three years has started lagging when it comes to electricity generation, this source of power now comprises a little less than 7% of the total electricity generated in the country.

Secondly, renewable energy is witnessing a slowdown in capacity addition due to inability of state distribution companies (discoms) to sign new Power Purchase Agreements (PPAs), says Care Ratings report on power sector.

During the 10 years from 2007 to 2017, renewable energy capacity has increased from 10 GW to 59 GW, during the same period coal and gas based electricity generation saw net addition of 135 GW.

“Hydro and nuclear energy generation capacity as a percentage of total installed capacity has fallen during this 10 year period. Nuclear power and hydro power capacity addition has been much less compared to thermal and renewable energy which could be attributed to lesser private sector role in setting up power plants in these segments. As a percentage of total installed capacity, hydro power witnessed a fall in its share from 23% in 2007 to 13.6% in 2017. Nuclear power capacity during the same period witnessed its share falling from 2.8% to 2.1%,” reads the report.

The largest share continues to be of thermal energy with almost two-third of the total installed generation capacity in the country.

In terms of electricity generation, total energy generated in the country was 1,135 billion units (BU) at a peak demand of 157 GW.

For this, thermal energy has been contributing in excess of 80% of the total electricity generated in the country. Hydro power is the second largest generator though its share has fallen from 15-16% in 2007 to 10% in 2017.

“Renewable energy in terms of electricity generated constitutes for 6-7% of the total electricity generated in the country. Even if renewable energy were to achieve its 2022 target  of 175 GW by 2022 and at the current electricity demand growth of 5%, coal would still continue to fulfil over 75% of the electricity generation requirement in the country,” added the report.

Currently, the PLF of coal based thermal plants is in the range of 58-60% as reported by Central Electricity Authority. Gas-based thermal power plants which constitute approximately 10% of the total installed thermal power capacity would continue to witness lower capacity utilisation in the range of 22-25% because of rising global gas prices.

Power tariff across sources remain to be low on account of suppressed demand and the same is expected to continue for the coming months.