Leading the Way

Insight into renewable energy growth in Rajasthan

In recent years, Rajasthan has established itself as a hub for renewable energy projects, with rising investments and a multitude of renewable energy projects being developed in the state. The total installed power capacity in the state is 32.5 GW as of April 2022, with renewables having a share of 55 per cent, followed by thermal energy at 43 per cent, and nuclear energy accounting for the remaining 2 per cent. Solar power holds the lion’s share in the total power mix, ac­c­ounting for roughly 36 per cent of the total power capacity and 64 per cent of re­newable capacity. Earlier this year, Raj­asthan became the first state in India to surpass 10 GW of cumulative large-scale solar installations. At present, Rajasthan is also the leading state in India in the overall renewable energy segment, with a total installed capacity of 17.04 GW. The state climbed up from its fourth rank last year to the first rank currently. Owing to the rapid development of renewable energy projects in the state, in financial year 2021-22, Rajasthan Renewable Energy Corporation Limited (RRECL) and an associate company set a profitability record by earning a profit of Rs 650 million before tax, roughly twice more than its profit in financial year 2019-20 and Rs 200 million more than that in financial year 2020-21.

The state aims to generate 30 GW of solar power by 2024-25, under the Solar Energy Policy 2019. As per the specified targets, utility, or grid-scale solar parks will acc­ount for 24 GW, distributed generation for 4 GW, and rooftop solar and solar pumps for 1 GW each. In line with the policy, 16,000 hectares of land have been allocated by the Rajasthan government for the development of solar and wind energy projects. Recently, the Rajasthan government also approved the Rajasthan Elec­tric Vehicle Policy to promote electric mo­bility in the state. Thus, the state is likely to continue on the rising growth trajectory in renewable energy installations over the coming years.

This article highlights the key projects and tenders, policy and regulatory developments, as well as the challenges and outlook of the renewable energy sector in Rajasthan…

Recent projects and tenders

Rajasthan offers various favourable factors for renewable project development such as land availability, robust policy su­p­port and minimal power curtailment iss­ues. The state also receives some of the highest levels of solar irradiation in the co­untry, making it one of the most attractive destinations for solar and solar-wind hybrid projects. Consequently, over the past few months, the state has increasingly attracted state authorities from other states to procure renewable power from projects set up in Rajasthan. Large-scale projects have been announced primarily in the solar sector, while the wind energy and electric vehicle (EV) segments have also witnessed developments in the state.

Recent project announcements (in chronological order):

December 2021: The Solar Energy Cor­poration of India (SECI) awarded capacities to NTPC, Sprng Energy, UPC Renew­ables, Metka EGN Singapore Pte, ReNew Power and ACME Solar in its auction for 1,785 MW of solar power projects (Tran­che IV) in Rajasthan. NTPC Limited also issued a request for proposals (RfP) for three years of operation and maintenance for its 260 MW solar project in Rajasthan’s Bhadla Solar Park. In the same period, Rays Power Infra signed a memorandum of understanding with the Rajasthan government for constructing an avant-garde solar project and generating 500 MW of green electricity.

January 2022: Jodhpur Vidyut Vitran Nigam Limited (JDVVNL) issued two tenders for the solarisation of 17 agricultural feeders of the Nosar and Dera substations in Jodhpur district of Rajasthan. In the first tender, JDVVNL invited bids for the design, supply, testing, installation and commissioning of 8.57 MW of solar power projects and the associated 33 kV lines. In the second tender, JDVVNL invited bids to solarise five 11 kV feeders at the Dera substation. The cumulative ca­pa­city of projects to be developed under Component C of the Pradhan Mantri Kis­an Urja Suraksha evam Utthaan Maha­bhi­yan is 3.45 MW.

February 2022: SJVN Limited submitted a letter of intent (LoI) to construct 10,000 MW of solar power projects in Rajasthan over the next five years. The projects will entail an investment of roughly Rs 500 billion. The Rajasthan government duly re­cognised the LoI and pledged its full co­operation. The projects are aimed to be de­veloped on land banks in Rajasthan which will be awarded by RRECL.

March 2022: Azure Power announced the completion of a 300 MW solar power plant located in Bhadla, Rajasthan (Rajasthan 8). The project is connected to the inter-state transmission system, and was allotted by SECI. The power generated is to be supplied to SECI at a rate of Rs 2.58 per kWh for a period of 25 years. NTPC Rene­wable Energy Limited also requested bids for land acquisition and an extra high voltage transmission system package for the development of 500 MW of state transmission utility-connected solar projects in Rajasthan.

April 2022: Tata Power Solar, one of In­dia’s largest integrated solar companies and a wholly owned subsidiary of Tata Po­wer, commissioned a 160 MW AC solar pro­­ject at Jetstar, Rajasthan. Approxima­tely 675,000 monocrystalline PV modu­l­es were used in this installation. The project is expected to produce 387 MUs of energy per year.

May 2022: Adani Green Energy Limited commissioned a 390 MW wind-solar hy­brid power generation project. Adani Gr­een’s subsidiary, Adani Hybrid Energy Jai­salmer One Limited, commissioned the pro­ject in Jaisalmer, Rajasthan. ACME So­lar Holdings also completed a 300 MW solar installation for the Maharashtra State Electricity Distribution Company. The solar project is located in Badiseed village in Rajasthan’s Jodhpur district. In the same month, Rays Experts announced that a large solar park, with a capacity of 3,000 MWp, will be constructed in Rajasthan. The solar park will be spread over 9,000 ac­­­res in Bikaner, Rajasthan. The project is re­portedly the first and the only 100 per cent privately owned ultra-mega solar park in the country connected to the central tra­nsmission system. GAIL India also is­sued an invitation for bids to operate and maintain a 5 MW solar power project in Ramgarh, Jaisalmer, for three years.

June 2022: NTPC Renewable Energy, a wholly owned subsidiary of NTPC, issued an RfP for the balance of system package (excluding land and transmission system) for a 500 MW STU-connected solar project in Bhadla, Rajasthan. Tata Power So­lar also completed the construction of a 450 MWDC solar plant for Brookfield Re­ne­wable India. The installation entailed the setting up of over 800,000 modules and is expected to produce over 800 GWh of clean energy per year, avoiding up to 600,000 tonnes of carbon dioxide emissi­ons per year. Recently, the Rajasthan ca­binet decided to allot 2,397.54 hec­tares of government land in Bandha village of Jai­salmer district to Adani Rene­wables’ sp­e­cial purpose vehicle, Adani Renewable Energy Holding Four, to set up a 1 GW so­lar power project. The land has been all­otted under the Rajasthan Land Reve­nue (Allotment of Land for Setting Up of Po­wer Project based on Renewable Ener­gy Sources) Rules, 2007. Further, in a bid to promote electric mobility, Rajasthan Electronics and Instruments invited bids for the survey, planning, supply, installation and commissioning of 409 EV chargers in nine cities and across three national highways and one expressway.

State policies and regulations

While Rajasthan has established a robust policy and regulatory set-up to promote renewable energy development in the state, it continues to update and introduce newer policies to keep up with the dema­n­ds on the renewable energy sector as well as the country’s overall clean energy targets. Recently, the Rajasthan government ap­proved the Rajasthan Electric Vehicle Policy, which had been delayed for almost a year. The EV policy aims to promote the use of EVs throughout the state and mini­mise pollution caused by conventional fossil fuel-based vehicles. According to the notification, EV buyers will receive a lump-sum payment from the state based on the battery capacity of their EVs. Furthermore, as per a notification released by the Rajasthan Transport Department in July 2021, EV purchasers will be reimbursed the state goods and service taxs (SGST) price in addition to receiving a one-time grant from the government. The Rajasthan government has also granted an additional Rs 400 million in budgetary support for SGST refunds to eligible recipients.

In January 2022, the Rajasthan Electricity Regulatory Commission (RERC) ruled that the increase in the rates of basic customs duty on import of solar inverters as well as the integrated goods and services tax (GST) and the social welfare surcharge will be considered a “change in law” event as per Arti­cle 12 of its power purchase agreements.

Furthermore, the RERC recently allowed state discoms to carry forward their accrued renewable purchase obligations (RPOs) from financial year 2011-12 to financial year 2019-20, and meet the RPO backlog and the respective yearly targets until financial year 2023-24. The commission has also included hydropower purchase obligations under non-solar RPOs.

Challenges and outlook

Rajasthan has taken several strides towards renewable energy deployment in recent months, yet certain challenges lie ahead. Environmental concerns have created barriers for renewable energy developers, as several projects have been stranded due to concerns associated with the Great Indian Bustard. In April 2021, the Supreme Court directed authorities to shift overhead power transmission lines underground within a year to protect the bird. However, the MNRE and solar developers have projected the cost of shifting powerlines underground to be unecono­mical. Large-scale projects near waterbo­dies such as the Sambhar Lake have also been stranded due to their possible im­pact on the biodiversity and ecosystem of the region. Thus, going forward, clarity re­garding such matters would play a significant role in determining the inflow of in­vest­ments for renewable energy development in Rajasthan.

By Kasvi Singh

 

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