Execution challenges, a tight financing environment and regulatory delays in tariff adoption are slowing down the pace at which new wind power plants are being commissioned. This, along with continuing challenges in grid curtailment and significant payment delays from distribution companies (discoms) have turned investor sentiment on the sector negative.
The wind power sector witnessed a capacity addition of 2.1 GW in FY20, improving over the 1.6 GW added in FY19. However, the actual capacity commissioned last fiscal was only 2.5 GW, against the 7.5 GW that should have been commissioned by March 2020 as per the timelines provided.
“The slow execution of the capacity awarded by the central nodal agencies and the state utilities is because of the continued execution challenges, a tight financing environment and regulatory delays in tariff adoption from the regulators in the past,”