In the face of highly ambitious renewable energy procurement targets, Indian utilities may now face stricter penalties if they fail to meet those targets.
The Minister of Power, Renewable Energy and Coal recently stated at a conference that the government may be forced to take strict action against utilities if they fail to achieve the renewable purchase obligations.
All states have set individual renewable purchase obligations wherein utilities are required to procure a set minimum percentage of electricity from renewable energy sources every year. While these targets have been in place for several years almost all utilities have so far failed to meet the targets.
The Indian government has increased its national solar power target from earlier 3% by March 2022 to 8%. This increased target is equivalent to the installed solar power capacity target of 100 GW by March 2022.
While power minister Piyush Goyal said that his ministry shall push the state governments and utilities to meet their respective targets but did not specify the likely penalties they’ll face in case they fail.
Indian media outlets quoted sources as saying that the central government may restrict the amount of financial aid that utilities are entitled to under a revival package announced few months back.