In line with the Centre's aim to boost renewable energy generation, India is likely to see its solar power capacity go up by 3,645 MW in 2016, clean energy consultant Mercom Capital Group said today.
India is targetting 175 GW of renewable energy capacity by 2022.
"Mercom forecasts about 2,150 MW in solar installations for the 2015 calendar year and expects installations in 2016 to reach approximately 3,645 MW, a significant year-over-year growth," it said in a statement.
"There have been a number of important energy related policy announcements recently, with increased activity on the ground with tenders and auctions beginning to occur more frequently," Mercom Capital Group CEO and Co-Founder Raj Prabhu said.
Year-to-date, solar installations in India stand at 1,652 MW, with cumulative solar installations in the country totaling 4,816 MW, it said.
After several delays, NTPC has begun calling for tenders under the 3,000 MW Phase II Batch 2 Jawaharlal Nehru National Solar Mission programme, it said.
The first auction under this batch closed with SunEdison placing the winning bid of Rs 4.63 kWh for a 500 MW solar project in Andhra Pradesh. This bid is the lowest in India to date.
"Bids are falling faster than component costs and there is a concern that this is a race to the bottom for solar bids in India," Prabhu said.
"The pent up demand due to auction delays is leading to aggressive bidding in an effort to capture market share with an assumption that component costs will continue to fall no matter what. This is a risky strategy considering the global market trends over the next 12 months," Prabhu said
India targets 175 GW of renewable energy capacity by 2022, which includes 100 GW of solar, 60 GW of wind power, 10 GW of biomass-fired power and 5 GW of small hydro power.