Open access solar capacity addition falls 37% to 518 MW in Jan-Mar: Mercom

Open access solar capacity installations in the country fell by 37 per cent year-on-year (y-o-y) to 518 megawatt (MW) in the January-March period of this year, according to Mercom India.

However, on a quarter-on-quarter (q-o-q) basis, the capacity addition was 68 per cent higher compared to 308 MW open access solar capacity installed in the October-December period of 2022, the research firm said in its latest report.

"In Q1 of the calendar year (CY) 2023, India added 518 MW of solar open access, an increase of over 68 per cent compared to 308 MW installed in Q4 2022. Installations were down 37 per cent y-o-y over 825 MW in Q1 2022," the 'Q1 2023 Mercom India Solar Open Access Market Report' said.

Solar power through open access is an arrangement where a power producer establishes a solar power plant to supply green energy to consumers.

As of March 2023, the country's pipeline of open access solar projects stood at 6.4 gigawatt (GW).

In Q1 2023, Karnataka remained the leading state, accounting for over 55 per cent of capacity additions, followed by Maharashtra (14 per cent) and Tamil Nadu (8 per cent).

Open access solar project costs decreased in Q1 2023 following the reduction of module prices compared to the previous quarter and increased imports after the government relaxed the Approved List of Models and Manufacturers (ALMM) mandate.

According to the report, lower project costs made the power purchase agreement (PPA) prices attractive. Commercial and Industrial (C&I) entities with renewable purchase obligations (RPO) also drove capacity additions during the quarter.

"Despite regulatory challenges in many states, open access solar demand continues from industries and commercial units keen on reducing their energy costs and locking in tariffs for the long-term. With most state DISCOMs raising retail tariffs and the solar project costs declining, we could see growth continuing in the next few quarters," commented Priya Sanjay, Managing Director at Mercom India.