Home 0. HYPERMEDIA India’s solar market to grow by 90% in 2017 according to Bridge to India
India’s solar market to grow by 90% in 2017 according to Bridge to India

India’s solar market to grow by 90% in 2017 according to Bridge to India

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2017 packs a lot of promise as the industry starts with an order pipeline of around 14 GW of utility scale projects, out of which 7.7 GW is expected to be commissioned in the year, a growth of around 90 percent over 2016.

The year gone by was certainly rewarding for the Indian solar sector as key indicators grew around 2-3 times in 2016. India added around 4.9 GW of solar capacity, an increase of 101 percent over 2015 and crossed the 10 GW cumulative installed capacity mark and the rooftop solar segment also crossed 1 GW in September, 2016 which is a 135 percent jump 2015.

2017 packs a lot of promise as the industry starts with an order pipeline of around 14 GW of utility scale projects, out of which 7.7 GW is expected to be commissioned in the year, a growth of around 90 percent over 2016.

Market research firm Bridge to India says that combined with 1.1 GW of expected rooftop solar capacity, India should add a total of 8.8 GW in 2017, ranking it amongst the top three global markets after China and the USA.

On the policy front, impact of central government policies related to manufacturing, power distribution (UDAY) and implementation of GST is awaited keenly.

“There has been some concerns about weak power demand growth in India and growing incidence of grid curtailment and what it means for growth of solar power. Demonetisation may also impact power demand negatively. But we believe that continuing reduction in module prices and downward trend in domestic interest rates will provide strong ongoing demand impetus to the market,” says Vinay Rustagi, MD, Bridge to India in the report. “Solar tariffs are expected to fall below the critical Rs 4.00 (USD 0.06)/ kWh mark making solar power the cheapest new source of power. At the same time, improving financial health of power distribution companies due to UDAY implementation will also help in sustaining renewable energy demand in particular. We expect sustainable demand of 6-8 GW for utility scale solar in the coming years,” he said.

As the Indian market ramps up, it will become a key pillar for demand growth when demand in other leading countries including China, Japan and even possibly the USA is expected to slow down.

“We already see leading international equipment suppliers paying more attention to this market and developing specific pricing and product strategies for India,” Rustagi said. “However, we are still unsure if improving domestic demand will lead to large-scale investments in greenfield manufacturing capacity.

Notwithstanding the Indian government’s keenness to support domestic manufacturing as part of ‘Make in India’ campaign, the competitive dynamics are stacked against this sector,” he added. On the Implementation of Goods and Services Tax (GST) during the year, the report says that it will lead to marginal cost increases and may create uncertainty for developers and contractors although there is a widespread expectation that any adverse impact will be passed through to the distribution companies.

Rooftop solar will also continue its spectacular growth trajectory in 2017. Rustagi further said, “We expect around 1.1 GW of rooftop solar capacity to be added in 2017, up 75 percent from 2016, driven by capital subsidies and substantial demand from public sector.” Overall, 2017 is likely to be a bumper year for the solar power sector in India and the total installed capacity is expected to reach 18 GW by the end of the year.
SOURCE: Bridge to India through Moneycontrol

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