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The economics of renewable energy has won the fight in India, says IEEFA

Hailing India as a world leader in the energy system disruption, the IEEFA has said that the economics of renewable energy in India has won the fight

  • Cost of renewable energy in India is now 20-30 percent lower than the cost of a new domestic coal-fired power plant

  • Renewables are clearly the low cost, zero inflation, zero-emissions source of new domestic electricity supply for India

New Delhi: Hailing India as a world leader in embracing the opportunities of the current energy system disruption, the IEEFA (Institute for Energy Economics and Financial Analysis) has said that the economics of renewable energy in India has won the fight.

“India is a world leader in embracing the opportunities of the current energy system disruption. While the energy security imperative is clear given India’s massive overreliance on volatile fossil fuel imports (and now more so than ever in a globally supply-constrained world), the economics have won the fight,” the report said.

Cost of renewable energy in India 50% lower than thermal power plant

Tim Buckley, Director of Energy Finance Studies IEEFA, South Asia, said that the cost of renewable energy in India is now 20-30 percent lower than the cost of a new domestic coal-fired power plant, and 50 percent below that of a new import-reliant coal power plant.

“Even as electricity demand has collapsed 27 percent this month to-date, the Indian government announced the awarding of a US$2bn 2 gigawatt (GW) solar tender at a near-record low price of Rs 2.55/kWh or US $33/MWh,” Buckley said.

On April 17, NHPC closed an e-reverse auction (E-RA) for the 2,000 MW grid-connected solar PV project to be set up anywhere in India at a tariff of Rs 2.55/2.56 per unit.

Renewables the new low-cost, zero inflation, source of power generation

Renewables are clearly the low cost, zero inflation, zero-emissions source of new domestic electricity supply for India, the report said. “Renewables have near-zero carbon impact on our warming planet. IEEFA expects the deflation of renewable energy costs to continue for the coming decade, accelerating the realisation of stranded asset losses for aging and obsolete coal-fired power plants, and other fossil fuel technologies,” the report added.