Coal tightens grip in power mix as solar slides in weak quarter for clean energy

A decline in solar installations and a surge in coal power from July to September reduced the total renewable energy additions this quarter, an analysis showed.

Investments fell by a steep 65% to $2.2 billion in the past quarter in a weak phase for the renewable energy sector, a study by the Institute for Energy Economics and Financial Analysis (IEEFA) said.

Globally, fund flows to clean energy projects have reduced amid concerns over maintaining profitability against the backdrop of rising interest rates and material costs, the study said.

To meet surging power demand across the country, a government order had extended the operation of fossil fuel utilities for blending from February to October, leading to an uptick in power generation. As a result, fossil fuels continued to be the source of nearly 75% of the power generated in the country between April and September, the study said.

The quarter wasn’t entirely bleak for the renewable sector. Notable investments did find their way.

The government charted plans to raise $2.2 billion (₹18,300 crore) by selling sovereign green bonds in the second half of the current fiscal. About half the funds may be allotted to railway projects, and the remaining has been earmarked for new and renewable energy projects, housing and urban affairs, as well as environmental and climate change endeavors.

French multinational energy firm TotalEnergies has tied up with Adani Green Energy to set up a joint venture, which will have a total of 1,050MW of wind and solar energy assets under operation. The deal is valued at about $300 million, or ₹2,500 crore.

State-run Rural Electrification Corp. Ltd (RECL) has thrown its weight behind Greenko, endorsing a $730.8 million investment for a pumped storage project boasting a 1,440MW capacity. Concurrently, discussions between RECL and Greenko are underway for financing other green energy projects.

Meanwhile, in Karnataka’s Gadag district, Serentica Renewables is gearing up for a 560MW solar-wind hybrid project, courtesy of RECL’s $370.6 million funding. Additionally, Power Finance Corporation is backing Serentica’s other renewable ventures in the state with about $312 million funding.

In Tamil Nadu, Tata Power Renewable Energy Ltd is prepping for a 4.3GW solar cell and module manufacturing facility, fueled by a $425 million funding from the US International Development Finance Corporation.

Renewable power producer Juniper Green has caught the eye of international investors. A joint venture of Singapore’s AT Capital Group and Dutch firm Vitol has poured in $350 million, enabling Juniper Green to chase an ambitious goal of tripling its capacity to about 2.5GW by 2026.

In a strategic move in the past quarter, INQ Holding LLC, an arm of sovereign Qatar Investment Authority, bought a 2.7% stake in Adani Green Energy for $473 million.

ReNew Power locked in a $324 million loan from State Bank of India for a 403MW project, whie Adani New Industries is bolstering its solar module manufacturing capabilities in Gujarat, thanks to a combined $394 million funds infusion by banking giants Barclays and Deutsche Bank.

Amid the flurry of investments, the World Bank has also unveiled a grand plan, sanctioning $1.5 billion to uplift India’s renewable energy landscape, pave the way for green hydrogen infrastructure, and promote low-carbon energy initiatives.