India may be able to slash its dependence on thermal power by half by soon as focus has shifted to renewable energy in the power sector. “India is chasing ambitious Renewable Energy (RE) targets and enhancing its T&D infrastructure. Increasing RE use is decreasing dependence on coal. Contribution of thermal sector to reduce to nearly 50% by FY22 and almost 43% by FY27,” a report by Praxis Global Alliance on ‘How India’s power sector will rebound from COVID-19 crisis’, said on Tuesday. Further, existing private players in the thermal power sector have been finding it difficult to raise money from financial institutions due to their current financial health and their contribution is also declining.
Thermal energy currently accounts for 63% of India’s total installed capacity which is identical to the global value. However, the private sector in the thermal sector is financially constrained. With the private sector being cash-strapped, a majority of the ongoing projects have been stalled while almost 6% for central and state government are stuck. New capacity addition has declined with stuck projects and the country’s installed capacity project has also stagnated, largely driven by the decline in new thermal capacity expansion.