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India sees 97% rise in open access solar installations in first half of 2022

New Delhi: India added 1.3 gigawatt (GW) of open access solar installations in the first half 2022, a staggering 97 per cent rise relative to 2021, according to a report titled ‘Mercom India Solar Open Access Market Report Q2 2022’, published by Mercom India Research Thursday.

The country had added 680 megawatt (MW) of open access solar capacity in the second quarter of the 2022 calendar year, a 223 per cent increase compared to 210 MW installations in the same quarter previous year.

Solar power through open access is an arrangement of contract between solar power producers and consumers. These producers establish solar power plants for consumers based on the Solar Power Purchase Agreement (PPA).

Open access usually enables consumers to buy relatively cheaper power directly from power producers, through the open market.

The report also noted that so far this year the installed solar capacity in the open access market is over 6.5 GW. Around three quarters of this capacity is centered in Karnataka, Maharashtra, Tamil Nadu, Uttar Pradesh and Rajasthan.

During the second quarter this year, these states made up 91 per cent of total installations in the country. Karnataka, being the leader, continues to dominate the market. It accounted for 44 per cent of all installations during the second quarter this year and 38 per cent of cumulative installations this year.

“Conducive policies and timely approvals by distribution companies (DISCOMs) have supported solar expansion through the open access route in Karnataka, Chhattisgarh, and Tamil Nadu,” the report added.

‘Demand for renewables mounting’

The report also noted that “increased focus on renewable purchase obligation (RPO) compliance” and “RE100 goals”— a global commitment for renewable electricity — by commercial and industrial companies drove up installations.

According to the Indian Electricity Act, 2003, RPO mandates that all electricity distribution licensees should purchase or produce a minimum specified quantity of their requirements from renewable energy sources.

Karnataka was also the leader at the Green Day Ahead Market (GDAM) and accounted for nearly 59 per cent of the market. GDAM is a market segment, introduced by the Indian Energy Exchange and the Power Exchange India, that allows consumers to purchase electricity a day in advance.

GDAM allows participants to bid and purchase electricity everyday. Meanwhile, Green Term-Ahead Market (GTAM) is the trading platform for renewable energy.

According to the report, “the GTAM witnessed a 39 per cent decrease in volumes traded through January, February, and March 2022”.

The report also stated that 2.8 GW of projects in open access solar power projects are under the “development and pre-construction” phase.

Reacting to the findings of the report, Priya Sanjay, managing director at Mercom India, said, “The green energy open access rules hold a lot of promise, and it is up to the states now to walk the talk. The demand for renewables through open access is mounting…Procuring renewables through open access is also helping businesses reduce their operating costs and carbon emissions.”

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Source: The Print

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