Versatility is an indispensable tool in today’s world. Any technology or human, for that matter, not versatile enough to adapt to a constantly evolving world, will ultimately be left behind. This holds true for every global industry, and in particular, the power sector.
As the world attempts to wean itself off of fossil fuels as a power source and adopt greener technology, reliability has become a glaring issue. Renewables are at the mercy of mother nature and any variation in weather conditions results in intermittency. The Indian renewables industry knows this all too well. Stakeholders like Adani, Siemens, ReNew Power and Suzlon have had to contend with challenging conditions even as they mapped out India’s green path.
One way of tackling this problem is diversification. Investing in dissimilar renewables projects allows companies to integrate different power sources and build a stable power supply base. A very good example is Adani Green Energy Limited (AGEL). It is one of India’s largest renewables company and has a diverse portfolio of renewable energy (RE) projects. The company has already achieved its target of 25GW four years ahead of schedule and even added 925MW operational capacity in FY21. Earlier this year, it raised a $1.35 billion debt package to finance its 1.69GW hybrid projects destined for Rajasthan.
However, diversification can only do so much. In a stark contrast to Adani, Siemens Gamesa has had to traverse much rougher weather. The ongoing pandemic disrupted its operations as the wind sector fell behind solar and contracts began to dwindle. Nevertheless, the situation is steadily improving as backlogged projects are being completed and new contracts issued. This clearly shows that while certain crises are unavoidable, strong foundations can go a long way in steeling sectors against market disruptions.
An alternative is turning to similar clean power sources like hydro just like ReNew Power has done. The company has been turning heads in the renewables market and recently marked its venture in the hydro sector, acquiring a 99MW hydro project from Larsen & Toubro (L&T). The acquisition is expected to cost Rs.985 crores and will allow ReNew Power to add another 200-300MW of low-cost hydro storage to its portfolio. Hydro assets offer the best alternative to intermittent renewables like wind power because of their fast startup times.
India has made it crystal clear that it plans to achieve a renewables capacity target of 450GW by 2030. Policies to support the proposal have been rolled out by the Centre to lend a helping hand to Adani, Siemens, ReNew Power and other players who are invested in the sector. Maintaining a diverse portfolio of renewable projects will be critical to achieving this goal and ensuring India’s energy security in the coming future.
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