Renewable energy: poor demand, weak utilities expose challenges

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The gap between good intentions and execution is starkly evident in one area of the renewable energy sector. Capacity additions are gathering pace but 25 states (including Union territories) are lagging on their solar renewable purchase obligation (RPO) targets for the current fiscal year, according to research firm Mercom Capital Group. States have to procure a certain portion of their power requirement from renewable sources.

Despite states not fulfilling their obligations, the central government’s push has ensured that cumulative solar installations topped 10,000 megawatts (MW). If states had adhered to their RPO targets, installations would have reached 17,700MW by end of FY17, points out the Mercom report. “Most states have defaulted on their RPOs, and this is the fifth year in a row. In the current financial year even Gujarat and Rajasthan have not been able to comply with state RPO,” says the report, citing an unnamed official of the Central Electricity Regulatory Commission.

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