ICRA in its latest report has said that wind energy generation capacity addition may improve to 3.5-4.0 GW in current financial year (FY20), while land acquisition and transmission connectivity challenges will remain crucial. Improvement in wind power capacity addition will be mainly on account of large project awards by the nodal agencies and measures being taken to address some of the key challenges.
It highlighted that since February 2017, the overall wind power capacity awarded by the central nodal agencies and the state distribution utilities has been sizeable at more than 12 GW, providing a visibility for substantial capacity addition. However, it said the actual execution on the ground has been slow with only 1.6 GW added in last financial year (FY19), owing to delays in execution caused by land acquisition issues and securing transmission connectivity.
It further mentioned that the government initiated certain measures towards resolving the issues faced by the developers, such as offering incentives in the form of facilitation charge to state governments providing support for land acquisition and investments towards augmenting inter-state transmission infrastructure. Besides, the tariff discovered in the recent wind power auctions continue to remain at less than Rs 3 per unit. The average bid tariff declined from Rs 3.01 per unit in CY17 (calendar year) to Rs 2.64 per unit in CY 2018.
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