India curbs solar power output to keep grid stable amid low demand, ministry says
Congestion in power lines due to some new plants coming into operation ahead of schedule and delayed transmission projects have also forced power output curbs, also known as curtailment, the MNRE said in an emailed response to questions late on Monday.
The curtailments are the latest setback to India's renewable power developers, who are increasingly languishing without supply contracts as demand for power slows.
The National Solar Energy Federation of India (NSEFI) said in a July 24 letter to the ministry that solar power producers in Rajasthan, the top green power producing state, were facing prolonged and frequent curtailments, which had risen to 48% of output during peak generation hours.
The producers have lost more than $26 million in revenue since April due to the curbs, NSEFI said in the letter reviewed by Reuters.
NSEFI, whose members include the green energy arms of Indian conglomerates Adani and Tata, Amazon Web Services, Dutch investment firm SHV and Malaysia's Gentari, said curtailments undermined project viability and future investments.
'Projects in the state had been deferred by 18-20 months to accommodate for the delays in the transmission system, but are still unable to be commissioned due to even further delays,' NSEFI said.
There's a need to strike a fair balance between solar and grid users
NSEFI has asked the government to accelerate transmission and battery storage projects, some of which face up to two years of delay.
The federal power ministry has said it is fast-tracking interstate transmission lines to support renewable energy.
Beyond Rajasthan
While Rajasthan is the worst affected by curtailments, other major green energy producers such as the southern Tamil Nadu state, and Gujarat and Maharashtra in the west are also curbing output, according to four industry officials and analysts.
Data compiled by Tamil Nadu's Renewable Energy Producers Association showed solar output was 10% lower than forecast in the quarter ended June. J Radhakrishnan, a spokesman for the Tamil Nadu energy department said solar was being curbed as a 'last resort' measure, and that coal power was also being curtailed amid low demand.
India's renewable energy generation, mainly solar, rose at a record pace in the six months ended June as previously awarded projects came online, while overall power generation growth was largely flat compared with an increase of nearly 6% in 2024.
However, solar projects awarded in the three months ended June fell 75% annually and tenders for new projects declined 65%, according to clean energy consultancy Mercom.
The decline reflects a 'temporary recalibration rather than a slowdown,' MNRE said, adding that bids were being issued in line with national targets and demand.
Government data shows the usage rate of solar capacity fell to 21.4% in May and 19.5% in June.
The MNRE said some of it was due to lower irradiance, adding it expected capacity utilisation of 21%–25% range from February to June in the future.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Recorder
an hour ago
- Business Recorder
India panel proposes exempting taxes on health, life insurance
NEW DELHI: A panel of Indian state ministers on goods and services tax (GST) has proposed exempting tax on health and life insurance premiums for individuals, two state ministers told reporters on Wednesday. The panel met days after Prime Minister Narendra Modi announced sweeping cuts to the GST to boost India's economy in the face of trade conflict with Washington. The panel of state ministers has proposed exempting health and life insurance premiums for individuals from the current 18%, the deputy chief minister of Bihar state, Samrat Chaudhary, said after the meeting in New Delhi. The final decision will be taken by the GST council, which is chaired by the federal finance minister and includes all state finance ministers as members. India's tax restructuring a 'huge reform', will boost competitiveness, Maruti Suzuki chair says The GST council meeting is expected in September or October, before the Hindu festival of Diwali, which is the country's biggest shopping season. The panel expects a revenue loss of 97 billion rupees ($1.11 billion) if health and life insurance premiums for individuals are exempted from GST, added Mallu Bhatti Vikramarka, a minister from the southern state of Telangana. In the next GST council meeting, the ministers are also expected to decide on the biggest overhaul of the tax regime since its introduction in 2017.
Business Recorder
2 hours ago
- Business Recorder
Russia has ‘special mechanisms' to supply oil to India, embassy official says
NEW DELHI: Russia will continue supplying oil to India and the country's President Vladimir Putin will meet India's Prime Minister Narendra Modi in New Delhi by the end of year, a Russian embassy official in India said on Wednesday. Russia has a 'very, very special mechanism' to continue oil supplies to India, Roman Babushkin, the charge d'affaires at the Russian embassy in India, told reporters at a press briefing, adding that India's crude oil imports from Russia will remain at the same level. No dates had been finalised for the Putin-Modi meeting yet, he said. The U.S. is set to impose an additional 25% tariff on Indian exports on August 28, citing their imports of Russian oil, which expanded after Western nations sanction Russian supply after its invasion of Ukraine. However, the U.S. has stopped short of imposing similar tariffs on China over its purchases of Russian oil. Indian Oil, BPCL resume buying Russian oil for September as discounts widen, sources say Last month, the European Union sanctioned Russian-backed Indian refinery Nayara Energy, leading the refiner to cut back processing and companies to curtail their trading with them. Trade between Indian and Russia was expected to grow 10% annually, Evgeniy Griva, Deputy Trade Representative of Russia to India said at the briefing.
Business Recorder
2 hours ago
- Business Recorder
India bond yields ease after 2-day climb lures value buyers
MUMBAI: Indian government bond yields ended lower on Wednesday, reversing a two-day trend, as investors indulged in value purchase after a selloff over the first two days of the week. The 10-year benchmark bond yield ended at 6.4969%, after ending at 6.5139% on Tuesday, which was its highest since March 28. The 10-year bond yield jumped as much as 15 basis points in the past two days after Prime Minister Narendra Modi unveiled sweeping goods and services tax reforms, expected to increase fiscal burden. The move also completely erased the rally that followed S&P Global's upgrade of India's rating, as traders started fearing additional supply. Despite lingering fiscal pressures, the fiscal deficit target is still achievable, a government official said. Union Bank of India has a constructive view that longer-duration bonds offer better risk-reward versus the shorter end under current conditions. 'The centre's clear signal of no supply glut and continued focus on borrowing discipline further strengthens our conviction for a favourable duration bias,' said Kanika Pasricha, chief economic advisor at Union Bank of India. India bonds fall; 10-year yield hits 4-month high as fiscal worries sap demand Immediately, investors remain focused on the minutes of the Reserve Bank of India's August policy meeting, which are due after market hours. Traders will assess the commentary for clues on the rate easing trajectory. The central bank had kept the key interest rates unchanged, even as it slashed its annual retail inflation forecast, a decision that had led to a bond selloff. Rates India's overnight index swap rates dipped in early trading hours, as traders resumed receiving floating rates after the rates rose to 2-month highs on fiscal worries. The one-year OIS rate ended at 5.5250% and the two-year OIS closed at 5.4750%. The liquid five-year OIS declined 2 bps to 5.7150%, amid receiving for a large foreign bank, traders said.
