Wfes day2 stream a 1430 1445 paolo frankl v2

India’s Renewable Energy Ambition Paolo Frankl Head, Renewable Energy Division International Energy Agency

Country Focus on India, WFES - Abu Dhabi, 18 January 2017 © OECD/IEA 2016

Annual wind and solar capacity additions conducive to targets The Government of India targets 160 GW of cumulative wind and solar by 2022 20000 18000 16000 14000

Cumulative additions

12000 Rooftop Grounded

10000 8000 6000 4000 2000 0

Source: Central Electricity Authority, Draft National Electricity Plan, December 2016

Renewable electricity targets for 2022 are ambitious, esp. with respect to solar PV deployment Š OECD/IEA 2016

Auctions proved effective in reducing generation costs Weighted average PPA bid prices in solar PV auctions, state and JNNSM*, 2010-2016

USD/kWh

0.3 0.25 0.2 0.15 500 MW

0.1 0.05 0 07/2010 Rajasthan Telangana Punjab JNNSM I

11/2011 Mahrashtra Madhya Pradesh Karnatka Reference

Karnatka Punjab Andhra Pradesh

03/2013 Telangana Karnatka Rajasthan

Rajasthan Telangana Tamil Nadu

08/2014 Andhra Pradesh Andhra Pradesh Madhya Pradesh

12/2015 Andhra Pradesh Madhya Pradesh Karnatka

Madhya Pradesh Uttar Pradesh JNNSM II

*Jawaharlal Nehru National Solar Mission

Competition and long-term contracts key to reduce prices Š OECD/IEA 2016

USD/MWh (nominal)

Comparing auctions across countries 140

Recent announced long-term contract prices for new renewable power to be commissioned over 2016-2019

Jordan

India

India

120

Germany

South Africa

100

Uruguay

80

Chile

France Jordan

Brazil

Germany US

South Africa

UAE

60

India

Peru

Mexico

Denmark

40 UAE 20

Chile

0 2013

2014

2015

2016

Solar PV

Prices differences strongly dependent on resource availability and cost of financing

Š OECD/IEA 2016

India’s electricity mix shift towards renewables

Installed power capacities in 2014 and 2040 in the New Policies Scenario

In the New Policy Scenario, by 2040 non-hydro renewables account for 1/3 of capacities (43% including hydropower) Š OECD/IEA 2016

India’s renewable energy targets are in line with ambitious climate targets India cumulative renewable capacity in 2016; 2022 targets; and WEO 2016 scenarios

Bioenergy

Solar PV

Wind

0

20

40

60

80

100

120

140

160

180

200

GW WEO 2016 450 in 2030

WEO 2016 NPS in 2030

2022 targets

2016

Financial health of utilities, better state-level implementation of RPOs, faster grid infrastructure expansion and reduced land acquisition barriers remain challenges Š OECD/IEA 2016

D olla rs pe r MW h (2 0 1 5 )

Relying only on wholesale markets may not suffice to drive investment

Utility-scale solar PV in INDIA 120

Competitive in NPS

X

X

80

40

0 2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

Utility-scale PV seems competitive in India and various other countries but in climate-friendly scenarios lower fossil fuel prices make competitiveness elusive Š OECD/IEA 2016

Integrating large shares of VRE requires system transformation Policy and market framework Flexible resources

Level of VRE penetration

System-friendly VRE deployment

planning planning & & investments investments

Distributed resources integration 24 /7

System services Generation time profile

Grids

Generation

Storage

Demand shaping

Technology mix Location

System and market operation

Integrated planning

Actions targeting VRE

Actions targeting overall system Š OECD/IEA 2016 - 8

Drivers & Challenges Drivers

Challenges

Excellent renewable resource availability

Accelerated implementation of federal targets at state level

Growing power demand and electrification needs

Improved financial health of state utilities

Robust and supportive policy environment with ambitious targets

Faster grid infrastructure expansion

Auction schemes with long-term PPAs

Land acquisition for some renewable projects

Š OECD/IEA 2016