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Time of India
6 days ago
- Business
- Time of India
India's power demand to grow 6-6.5% annually through FY2030, driven by EVs, data centres, green Hydrogen: Icra
India's power demand is projected to grow by 6.0–6.5 per cent annually over the next five years, driven by accelerating electric vehicle (EV) adoption, rapid expansion of data centres, and the development of green hydrogen projects, according to ICRA. Tired of too many ads? go ad free now 'These three segments are expected to contribute to 20–25 per cent of the incremental demand over the next five-year period from FY2026 to FY2030,' said Vikram V, Vice President & Co-Group Head - Corporate Ratings, ICRA, quoted by ANI. However, he also claimed that this rising demand for grid capacity could be partially offset by the increasing uptake of rooftop solar and off-grid solutions, aided by initiatives like the Pradhan Mantri Surya Ghar Yojana. The report highlights that the EV sector will see broad-based growth, led by three-wheelers, followed by two-wheelers, electric buses and passenger vehicles. For FY2026, ICRA expects a strong thermal plant load factor of 70 per cent, backed by a projected power demand growth of 5.0–5.5 per cent. Total power generation capacity is forecast to rise to 44 GW in FY2026, up from 34 GW in FY2024, with contributions from both renewable and thermal sources. 'The thermal segment is expected to add 9–10 GW capacity in FY2026, while the remaining capacity addition will primarily come from renewable energy,' the agency said. While renewables will continue to dominate capacity growth, ICRA noted a significant uptick in thermal projects under construction, which currently exceed 40 GW. The agency also observed that the expected FY2026 demand growth of 5.0–5.5 per cent is slightly below its GDP growth forecast of 6.5 per cent for the same period, attributing the gap to the anticipated early onset and above-average monsoon, which tends to dampen cooling and agricultural power demand.
Time of India
7 days ago
- Business
- Time of India
Electricity demand to grow 5-5.5% in FY26; 44 GW capacity addition likely: ICRA
New Delhi: India's electricity demand is projected to grow by 5.0–5.5 per cent in FY2026, trailing the anticipated GDP growth of 6.5 per cent, according to ICRA. The lower projection is attributed to the early onset of monsoon and the expectation of an above-average rainfall, affecting cooling and agricultural demand. The projected growth is higher than the 4.2 per cent reported in FY2025 but lower than the over 8.0 per cent growth recorded between FY2022 and FY2024. ICRA estimates the all-India thermal plant load factor (PLF) to remain flat at 70.0 per cent in FY2026, compared to 69.5 per cent in FY2025. This is despite an expected addition of 9–10 GW thermal capacity, with renewable energy sources contributing significantly to the generation mix. "Over the next five years, ICRA expects the electricity demand to achieve a healthy compounded annual growth rate (CAGR) of 6.0–6.5 per cent, higher than the ~5.0 per cent CAGR achieved over the past decade, driven by the demand from rising adoption of electric vehicles (EVs), green hydrogen (GH) and the increase in data centre capacity," said Vikram V, Vice President & Co-Group Head – Corporate Ratings, ICRA. EVs, green hydrogen, and data centres are expected to contribute 20–25 per cent of the incremental power demand during FY2026–FY2030. Rooftop solar and off-grid installations, supported by initiatives like the Pradhan Mantri Surya Ghar Yojana, are likely to partially offset the increase in grid-connected demand. Total power generation capacity addition is expected to touch 44 GW in FY2026, the highest-ever addition in a single fiscal, surpassing the 34 GW added in FY2025. This would take the overall installed capacity to nearly 520 GW by March 2026. Of this, thermal capacity additions are estimated at 9–10 GW, while the remaining would come from renewable energy. The under-construction thermal capacity has increased to over 40 GW in the last 12 months. In the spot market, average power tariffs on the Indian Energy Exchange declined to ₹4.4 per unit in FY2025 from ₹5.2 in FY2024, owing to slower demand and higher available capacity. Coal stock at thermal plants stood at around 20 days as on May 21, 2025, the highest in five years, due to improved supply and lower growth in thermal generation. Lower imported coal prices and improved availability are expected to keep short-term tariffs stable in FY2026. Book losses for distribution companies (discoms) declined in FY2024 over FY2023, helped by tariff hikes, subsidies and state grants. However, the cost-tariff gap continues across most states. Gross debt for state-owned discoms rose to ₹7.4 lakh crore as of March 2024 from ₹6.6 lakh crore in March 2023, driven by borrowings for settling past dues and funding capex and working capital requirements. "The tariff orders for FY2026 have been issued in 19 out of the 28 states as of May '25, reflecting a moderate progress in issuance of tariff orders. Despite the loss-making operations of the discoms, the tariff hikes approved for FY2026 remain muted across most states, similar to FY2025," Vikram V added. ICRA projects the cash gap per unit for discoms at the all-India level to remain high at 35 paise per unit in FY2026 and maintains a "Negative" outlook for the power distribution segment. The implementation of smart metering and timely execution of fuel and power purchase cost adjustment mechanisms are identified as crucial for financial recovery of discoms.
Time of India
19-05-2025
- Business
- Time of India
ICRA revises telecom tower industry's rating to stable from negative
New Delhi: Investment Information and Credit Rating Agency (ICRA) on Monday, revised its outlook for telecom tower industry to stable from negative, helped by the timely payments from key customers, along with the clearance of past over dues, which has eased the receivables cycle of the telecom tower companies. According to ICRA, the situation has improved drastically "with consistent, timely payments to the tower companies," leading to a reduction in receivable days to around 45-60 days, which is lower than ICRA's negative outlook threshold of 80 days. "Improvement in the credit profile of some key telecom service providers, who are the customers for tower companies, has eased the working capital cycle of tower companies. Moreover, there has been clearance of a sizeable amount of past over dues, which has resulted in reversal of provisions made earlier in FY2023," said Ankit Jain, Vice President and Sector Head, Corporate Ratings, ICRA Ltd. "The collections are expected to remain timely, going forward, thereby restricting the industry debtor levels below 60 days. This will also result in a reduction in external debt, with ICRA projecting net external debt/OPBDITA at around 3.4x for FY2026," he added. The improved credit quality has helped to boost the demand for telecom services, especially data, which would lead to consistent network expansion and upgradation by the telcos. "This is keeping the demand for tower companies buoyant, resulting in consistent additions in the tenancies," the release by ICRA added. ICRA sees the tower industry is likely to see an operating income growth of 4-6 per cent with operating margins at around 70-75 per cent for FY2026. "These along with easing of the working capital requirements, is likely to boost the liquidity position with the cash balances of the industry increasing to around Rs. 5,500-6,000 crore from Rs. 2,200-3,000 crore levels in the past." the agency added.
Yahoo
25-04-2025
- Business
- Yahoo
New policy shift threatens the future of solar and wind projects across key regions: 'Companies have to additionally factor the cost'
Clean energy that derives electricity from renewable, nonpolluting sources like wind and solar is a growing sector on the world stage. Up until now, it has been doing particularly well in the Indian state of Rajasthan. But new fees affecting land sales for clean energy projects are set to slow that progress down, Reuters reported. Rajasthan, a desert region, is the ideal site for solar farms, which often require 50-100 acres of unoccupied land. With new development, the state has amassed 30 gigawatts of clean energy capacity, and Indian companies have pledged to invest billions of rupees in more. However, Rajasthan's land registration laws have recently been amended. Now, companies must pay registration charges and stamp duties for both leasing and purchasing land that they want to develop for clean energy projects. The change represents an 8% to 10% increase in land costs. Since land accounts for about one-fifth of the total project cost, per Reuters, that's an increase of up to 2% of the overall cost of a clean energy project — a large sum when we're talking about a full-scale solar or wind farm. "For newer projects that are yet to be bid out and developed, companies have to additionally factor the cost," said Vikram V, vice-president and co-group head of Corporate Ratings at credit rating agency ICRA, per Reuters. Land costs are already an obstacle to clean energy development efforts in India, especially in the most desirable areas with reliable connections to the power grid. Those costs are set to keep going up, which will inevitably slow the adoption of solar. Right now, solar and other clean energy options are the world's best shot at cooling down the planet. Heat-trapping air pollution from dirty energy sources is heating up the Earth and causing severe weather disruptions. Clean energy is making a difference, but we need to commit to making the switch to prevent major harm to our world. You may not be able to change India's land sale policies, but you can vote for local candidates who have an environmentally friendly agenda. You can also adopt solar yourself, either by installing solar panels if you're in a position to do so or by subscribing to a community solar service. If you were to install home solar panels, which of these factors would be your primary motivation? Energy independence Lower power bills Helping the planet No chance I ever go solar Click your choice to see results and speak your mind. Join our free newsletter for good news and useful tips, and don't miss this cool list of easy ways to help yourself while helping the planet.
Reuters
24-03-2025
- Business
- Reuters
Rule change to drive up clean energy project costs in India's top solar state
March 24 (Reuters) - Renewable energy projects in Rajasthan, India's leading solar state, are expected to become more expensive and face delays due to a recent amendment to the state's land registration laws, industry experts said. The Rajasthan government has made it compulsory for companies to pay stamp duty when signing an agreement for sale or leasing land for solar projects, as both types of agreements must now be registered. New renewable energy projects in Rajasthan would see at least 8%-10% increase in land expenses due to registration charges and stamp duties, said senior executives from four renewable energy companies who did not wish to be named due to the sensitivity of the issue. Land expenses account for nearly one-fifth of overall project costs. "For newer projects that are yet to be bid out and developed, companies have to additionally factor the cost," said Vikram V, vice-president and co-group head of Corporate Ratings at the credit rating agency ICRA. Rajasthan tops Indian states in installed renewable energy capacity, at about 30 gigawatts, and Indian companies have pledged billions of rupees in investments in the state. Solar projects require large tracts of land, typically ranging from at least 50 to 100 acres to build 10-20 megawatts. With abundant land and high solar radiation, the desert state of Rajasthan stands out as a top choice. India's clean energy sector has been facing obstacles including weak demand for tenders, delays in power agreements and project cancellations. Issues such as the non-availability of land in resource-rich areas, site accessibility problems and complexities in land aggregation have already posed major challenges to clean energy deployment, according to a recent report from the Council on Energy, Environment and Water. The share of land cost in the overall project expenses has more than doubled and is expected to increase further in areas with strong connectivity and clean energy potential, CEEW said.
