According to Ind-Ra, solar projects exhibit stability, benefiting from adequate debt coverage and improved liquidity. The decline in module prices has proven advantageous for under-construction projects. However, the agency highlights the importance of timely project completion, emphasizing the significance due to the slowdown in yearly capacity additions expected in the first half of fiscal 2024.
Ind-Ra's data indicates that India added 5 GW of solar capacity and 1.6 GW of wind in the first half of fiscal 2024, a decrease from the 6.8 GW of solar and 1.3 GW of wind installed in the corresponding period of fiscal 2023. The total capacity additions for all of fiscal 2023 stood at 12.8 GW for solar and 2.3 GW for wind.
Wind projects, according to Ind-Ra, continue to grapple with generation variability. The agency anticipates wind generation in fiscal 2024 to be comparable to the preceding year. The removal of reverse auctions is expected to enable developers to bid with improved risk-return profiles, potentially supporting capacity additions over the medium term.
The assessment underscores the evolving dynamics within India's renewable energy sector, where solar projects find stability amid favorable market conditions, while challenges persist for wind projects, requiring strategic adaptations for sustained growth.