States Need To Improve Their Renewable Policies, Says Report

With India poised to grow at 7.3 per cent in 2017-18 and higher in the coming fiscals, the demand for energy, especially sustainable energy is bound to take a leap. Without a doubt, it becomes utmost important for the centre and the state government to formulate policies, leveraging the renewable mix of the country.

It is commendable that almost all the states have issued specific renewable policies and the efforts at the apex have resulted in greater penetration of the clean energy, the policy framework is still not robust enough to draw maximum results and need improvement, according to a recent report by CII.

“The ecosystem of Renewable Energy in is still fraught with constraints, in particular respect to State policies. Even though most of the Northern States have come up with their Renewable Energy Policies, but it is important to understand and imbibe the best incentives and practices depending on the need of the State”, says the report.

Amongst all the regions, Northern region has the maximum potential at 365 GW and can emerge as the hub for renewable energy in the country, given the right policy framework.

“There is a need for well-defined renewable energy policies in the states to create a conducive environment to lead this transformation by leapfrogging old technologies and building a state-of-the-art smart grid powered by affordable renewable energy," said Ratul Puri, Chairman, CII NR Committee on Power, during the fourth edition of the CII Renewable Energy Summit.

In terms of renewable potential, Rajasthan is followed by Jammu and Kashmir (118,208 MW), Himachal Pradesh (36,446 MW), Uttar Pradesh (27,593 MW), Uttarakhand (19,071 MW), Punjab (6,768 MW), Haryana (6,470 MW), Delhi (2,181 MW) and Chandigarh (6 MW).

Southern and Western Regions are also fast moving up the Renewable Energy installed capacity graphs.
The report also takes a case of the hydro policy scenario, amongst its solar and wind peers. While all the states have a dedicated solar framework, very few states have specific policies for small hydro, except Himachal Pradesh, J&K and Uttrakhand. These states are applauded for providing incentives and tax exemption, including various subsidies to draw investment in the hydro space.

Inderpreet Wadhwa, Founder, Director and CEO, Azure Power called on the States to come up with a policy mechanism which clearly defines the right mix of power requirements and power consumption in the state, so that new projects can only be auctioned after the demand for power is determined. 

Ratul mentioned challenges such as financial health of DISCOMs; inadequate and outdated grid infrastructure and operations, fragmented solar component manufacturing with many small players and high AT&C losses.  He added that exemption from wheeling charges, electricity duty and incentives may help in attracting fresh investments.