Renewable auctions haven’t lost steam despite pandemic: Sumant Sinha, senior vice president, ASSOCHAM

Sumant Sinha, senior vice chairman, ASSOCHAM

Even with the pandemic slowing down the tempo of renewable power deployments within the nation, the {industry} and authorities had been profitable in limiting the damages to the minimal, says Sumant Sinha, senior vice chairman of {industry} group ASSOCHAM. Sinha, who can also be the chairman and managing director of ReNew Power, tells Anupam Chatterjee why he thinks the sector is headed in the proper route and prospects are vibrant for the {industry}. Excerpts:

How did the industry-government teamwork pan out in coping with the coronavirus disaster?

The pandemic has been a disruptor to all financial exercise throughout the globe, however I imagine the renewable power {industry} and the federal government have labored collectively to make sure that the influence … was minimal on the sector … Firstly, regardless of the pandemic, auctions didn’t lose steam and aggressive photo voltaic tariffs had been found. Secondly, the federal government’s Aatmanirbhar Bharat bundle introduced final yr helped infuse cash into the distribution sector and allowed energy turbines to get majority of their cost dues. In the meantime, the PLI scheme to spice up home manufacturing was additionally launched, paving the way in which for a lot of Indian firms to get into photo voltaic module manufacturing.

Despite the Rs 1.25 lakh-crore mortgage bundle for discoms, dues to non-public energy gamers have been rising whereas these for CPSE energy crops have fallen. Doesn’t such a growth ship the fallacious indicators to traders?

Every state and discom has its personal desire and method of working. Some state discoms have accessed the mortgage bundle introduced by the central authorities and made funds to varied turbines, whereas others are nonetheless deciding. Wherever the mortgage bundle has been availed, the state of affairs is best. So the bundle has actually helped non-public gamers to an extent. Past the bundle, the ability ministry has already come out with a algorithm and late cost surcharge order to encourage well timed funds. The long-term resolution, nonetheless, lies in reforming the distribution firms to make sure they’re environment friendly and worthwhile.

In renewable power, the coverage focus is seemingly transferring in direction of home manufacturing. Although it’ll elevate ultimate tariffs within the rapid future, do you assume the long-term advantages outweigh the near-term points?

As a result of geopolitical state of affairs, power safety has turn into paramount. As renewable power sources exchange fossil fuels, our import dependency on vital gear for such power sources must also lower. However with vital parts being imported, we are going to merely exchange one import dependency with one other. Therefore, it’s crucial that we begin home manufacturing of vital parts. Our home market, which is anticipated to extend and attain near 20GW of capability yearly, is massive sufficient to help manufacturing inside the nation, and as we develop in scale, we should always be capable to produce these parts at globally aggressive costs. Manufacturing can even result in the creation of a part ecosystem, add lakhs of recent jobs, and save lakhs of crores of international change from going in a foreign country. ‘Aatmanirbharta’ in vital areas is, subsequently, a necessity right now.

When do you count on annual renewable power capability additions to surpass the 12.5 GW stage recorded in FY18?

Like final yr, this yr additionally Covid-19 has disrupted development of recent capability. Nevertheless, as most residents get vaccinated, a gradual revival of financial exercise is inevitable. Because the financial system picks steam, I count on staff to get again to mission websites. Which means that as early as subsequent yr, when many tasks are anticipated to come back on-line, you may even see the renewable {industry} reaching document ranges of capability addition.

With the most recent instance of Uttar Pradesh, states want to cancel older bids in pursuit of decrease renewable power tariffs. Is the {industry} discussing such points with the federal government?

I might not prefer to touch upon any particular case. Nevertheless, the central authorities could be very clear on respecting the sanctity of contracts and the necessity to defend them. Union energy minister Shri RK Singh ji has again and again reiterated the necessity to make sure that contracts are honoured. The worldwide investing neighborhood takes this challenge very significantly, and therefore to draw worldwide funding, long-term stability in contracts is paramount.