The Government-owned power giant of India, NTPC, announced on December 26, 2019, that it planned to add 10GW of solar energy generation capacity by 2022. Currently, the power plant is looking for all-round investors to garner Rs. 50,000 crore worth of investment funding, a source has said, “An investment of around Rs. 50,000 crores, to be funded mainly by green bonds.”
Expansion of Solar Energy Capacity
National Thermal Power Corporation Limited or NTPC Ltd., is the largest thermal power that provides electricity in India. Presently, in terms of size and efficiency, NTPC holds a key position in the Indian energy sector. It contributed around 25% of India’s total energy generation during the financial year 2015–16.
The power plant, with a view to becoming an ‘Integrated Power Major’ is now focused on developing its solar energy capacity to increase power supply to cater to the rising demand of the customers and to ensure power sustainability in the country. NTPC, which is presently dependent on fossil fuels for generating electricity, is now focused on producing cleaner energy through the expansion of its existing capacity for hydro and solar energy.
At present, NTPC has a solar energy-producing capacity of 920MW. By 2032, the company aims to achieve a long-term plan of upgrading the existing capacity to 130 GW that would generate more than 30% non-fossil fuel or renewable energy capacity. To achieve this broad plan, the company has formulated policies to implement the addition of 4 GW each year starting from 2020. According to the Economic Times, “The company will complete tendering of 2,300 MW of solar energy capacity by the end of this fiscal.”
Green-based Energy Investors
NTPC’s plan for upgrading its energy-producing capacity requires huge funding from both domestic and foreign investors. However, the power plant is focusing especially on those investors that deal with the renewable energy business. A source said, “The company is open to any borrowing option in the market, which is economical.
However, the company would mainly rely on green bonds that are offered for pure clean energy projects. The company wants to raise money through domestic as well as overseas green bonds.” The source continued, “The company would also set up some of its solar energy projects under scheme where it gets viability gap funding to keep the tariff below Rs 3 per unit level.”
The source added, “Besides, the company will also set up solar energy projects without any long term (for 25 years) power purchase agreements (PPA) as it intends to sell the electricity to industrial as well as commercial consumers and also at energy exchanges.” The power sector regulator, Central Electricity Regulatory Authority (CERC), has already approved the real-time power market of NTPC, which is likely to start operating from April 1, 2020.
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