India recorded its highest-ever yearly solar installation of 13 GW in 2022. The annual addition was 27% up from 10.2 GW installed in CY 2021, according to Mercom India Research’s 2022 Q4 & Annual India Solar Market Update.
Large-scale solar projects accounted for 87% of the cumulative 13 GW installations in 2022, a 33% surge YoY.
Q4 2022 addition stood at 2.6 GW.
India’s cumulative installed solar capacity reached 63 GW on Dec. 31, 2022. The large-scale solar project pipeline stood at 58 GW, with another 51 GW of projects tendered and pending auction at the end of 2022.
“Though impressive, record solar capacity additions in 2022 were barely half the 27 GW annual installations needed to meet the 280 GW target by 2030. Policies must be quickly retooled and hurdles removed to double the annual pace of installations and attract the needed investments,” said Mercom Capital Group CEO Raj Prabhu.
According to the report, the growth outlook going into 2023 remains uncertain, with the pending judgment on projects stranded in the Great Indian Bustard region, the pending announcement on Approved lists of Models and Manufacturers (ALMM), and expected project extensions per MNRE’s direction to Solar Energy Corp. of India, Indian Renewable Energy Development Agency, NHPC, and NTPC.
The report highlights a rise in the average cost of projects throughout CY 2022 due to higher module prices and supply constraints. Average large-scale system costs in Q4 2022 increased by 7.3% YoY, making it an unprecedented ten quarters of project cost increases in a row.
In 2022, solar tenders increased 23% YoY, while auctions fell 29% compared to 2021. Implementation of basic customs duty (BCD), shortage of modules enlisted under the ALMM, and various policy announcements and amendments resulted in lower auction activity in 2022.
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