New Delhi, Feb 24 India’s annual capacity addition of wind power is projected to more than double to 7.1 gigawatt (GW) on average in the next two financial years, compared with 3.4 GW in fiscal year 2023-25 -- driven by government measures to ramp up the pace, a report said on Monday, adding that this will take the country’s total installed wind capacity to around 63 GW by 2026-27.
The capacity additions over the financial years 2023-24 and 2024-25 continued to remain tepid in the range of 6-7 GW on account of fewer successful auctions of wind capacities (5.9 GW in FY21-23 and 5.2 GW in FY23-25), according to a Crisil report.
These were largely due to lower interest from developers on account of low tariffs that dampened returns for developers along with issues in terms of availability of land and transmission infrastructure at sites with high wind potential, the report observed.
However, tailwinds are emerging which will help double the pace of capacity additions over the next two financial years.
The government’s push towards the auctions of hybrid renewable projects (which are a combination of solar, wind and/or storage) as well as an emerging favourable cost regime for wind projects are expected to drive capacity additions, according to the Crisil report.
In addition to the steady auction pace of standalone wind projects, auctions of hybrid renewable energy projects (which require the developers to supply renewable electricity during high-demand — evening and early morning — hours) have spurted.
Around 30–50 per cent of the capacities of such hybrid projects are expected to be wind power as these generate electricity during peak load times, unlike solar power, which generates mostly during daytime.
Further, as these hybrid projects help distribution companies (discoms) solve the problem of scheduling power at critical times, they are expected to find favour in offtake and grow fast, the report stated.
According to Ankit Hakhu, Director, Crisil Ratings, the country has over 30 GW of hybrid projects in the pipeline which are expected to be commissioned within next 2-4 years and would contribute to the expected step-up in wind capacity additions.
“Traction in signing power purchase agreements (PPAs) is also visible, with more than 60 per cent of such projects auctioned till March 2024 having their PPAs signed by January 2025,” he noted.
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