Breaking News

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


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

Micro-finance institutions' asset quality stabilizes: Crisil Ratings

Credit ratings agency, Crisil Ratings in its latest report has said that asset quality of micro-finance institutions (MFIs) comprising small finance banks as well as non-bank MFIs has shrugged off the......

RBI's new NPA norms likely to push up banks' credit costs, weaken earnings: Fitch Ratings

Fitch Ratings in its latest report has stated that the Reserve Bank of India's (RBI) new norms for overhauling the mechanism to deal with the bad debt, is likely to push up banks' credit costs and weaken......

India will emerge as model for rest of world on completing transitions: Rajiv Kumar

With successful completion of three transitions such as economic, political and social, the Niti Aayog vice-chairman Rajiv Kumar has said India will emerge as a model for the rest of the world. ......

Top News

View all news

Sadbhav Infrastructure emerges lowest bidder for Vadodara Kim Expressway Project

Sadbhav Infrastructure has been declared L-1 (Lowest) bidder by the National Highways Authority of India (NHAI) for new Hybrid Annuity Project in the State of Gujarat.The Project is for the construction......

Tribhovandas Bhimji Zaveri opens 37th store in Pune

Tribhovandas Bhimji Zaveri has opened its 37th store at Unit No. UG-71, Phoenix Market City Mall, Viman Nagar, Pune, in state of Maharashtra on March 17, 2018.Tribhovandas Bhimji Zaveri, a well-known jewellery......

DHFL planning to raise funds through NCDs

Dewan Housing Finance Corporation (DHFL) is planning to raise funds through Non-Convertible Debentures (NCDs). The company has proposed to issue Secured Redeemable NCDs amounting to Rs 300 crore and a......