As many as 24 power projects with 41.81 GW capacity may be under a severe financial stress, but the troubled sector still holds hope in growth drivers including higher demand from the Railways, proposed law to enforce power purchase agreements (PPAs) on the discoms, increasing focus on electric vehicles and reaching electricity to all un-electrified villages, an Assocham study has noted.
“Our assessment shows that all is not that bad, as is made out by stock analysts or the bankers getting panicky, having financed the big projects. There are good prospects, provided we are able to enforce PPAs and work on the plans already finalised,” said Assocham Secretary General D S Rawat.
The government proposes to amend the law-making obligation under PPA, statutorily binding all discoms to have PPAs to cover 100 per cent requirement.
Similarly, Indian Railways have taken great initiative for electrification. About 50 per cent of the Railways is presently electrified. It is expected that the railway load is expected to exceed 3,000 MW by 2021-22 from a current traction load of 2,000 MW thus opening a potential of demand creation.
In view of large capacity addition of renewable energy sources in the country, strict enforcement of renewable purchase obligations (RPO) has become necessary. In fact, one amongst the various amendments proposed in the Electricity Act is the strict enforcement of RPO.
By and large, electricity is emerging as the primary source of energy as electric mobility is more efficient than mobility by petrol or diesel, the only thing required is the prices of the battery of storage systems to come down.
Combination of solar power and electric vehicle (EV) is the key to significantly reducing dependence on fossil fuels. In addition, storage is going to be next frontier for India’s clean energy push and the batteries in EVs offer a potential solution, the paper added.