Breaking News

You are here » Indian-Commodity  :  Economy  :  India's renewable energy market to experience strong growth: Moody's

28-Jun2017

India's renewable energy market to experience strong growth: Moody's

Global ratings agency Moody's Investors Service in its latest report has said that the renewable energy market in India is likely to experience strong growth over many years, as the country is moving towards meeting its commitments under the Paris Climate Change agreement on climate change. Though, it has also pointed out that renewable energy projects face a few headwinds related to the weak credit quality of offtakers, an evolving regulatory framework along with financing and execution risks.

The ratings agency has explained that India's emission reduction commitments under the Paris agreement will lead to a sharp rise in renewable energy capacity. It also noted that the country is aiming to achieve 40% of cumulative installed capacity through from non-fossil fuel-based energy resources by fiscal year 2030 from a current level of 30%. Adding further, it said that the country also plans to expand its renewable energy installed capacity to the tune of 175 gigawatts (GW) by 2022 from the current capacity of 57GW. It added that such growth will be driven by the public and private sector. 

The report however said that the key offtakers for most renewable projects are state-owned distribution companies, and these firms typically demonstrate weak financial profiles. It also said that this situation poses a key challenge for developers and while there is no history of defaults under power purchase agreements, payment delays are quite common. Moody's report pointed out that the overall policy framework for renewable energy is still evolving and noted that adherence to renewable purchase obligations has been low till now, leading to lower demand for renewable energy.


Related News

View all news

Working group recommends measures to attain $5 trillion economy by 2025

In order to increase the size of India's economy to $5 trillion by 2025, a working group of the Commerce and Industry Ministry has come out with a blueprint suggesting a bunch of lengthy and short-term......

RBI to inject Rs 10,000 crore into the system through OMOs

In a bid to increase liquidity in the market, the Reserve Bank of India (RBI) has said that it will inject Rs 10,000 crore into the system through purchase of government securities on January 17, 2019.......

Retail inflation softens to 18-month low of 2.19% in December

India's retail inflation based on Consumer Price Index (CPI) continued its easing trend for third straight month in December mainly on account of sliding prices of fruits, vegetables and fuel. CPI softened......

Top News

View all news

Spicejet's cargo arm launches freighter services on Guwahati-Hong Kong route

Spicejet's cargo arm SpiceXpress has launched dedicated freighter services between Guwahati and Hong Kong with a weekly flight, starting January 19, 2019. With this launch, SpiceXpress will be the first......

Reliance Industries to invest Rs 3 lakh crore in Gujarat in next 10 years

Reliance Industries has committed to invest Rs 3 lakh crore in various projects in the next 10 years in Gujarat that may range from energy and petrochemical to new technology and digital business. The......

Wipro reports 32% rise in Q3 consolidated net profit

Wipro has reported results for third quarter ended December 31, 2018. The company has reported a rise of 39.56% in its net profit at Rs 2,518.40 crore for the quarter under review as compared to Rs 1,804.50......