The World Bank is set to provide expertise to the Indian state of Odisha to
help the latter develop medium-term renewable energy policy. The initiative
would enable the state to reduce dependence on fossil fuels and further enhance
itself as a one of the leading states in India to promote renewable energy.
The World Bank would work closely with
the International Finance Corporation, which is helping the government develop
a robust solar energy policy. While Odisha is not as well known as other Indian
states like Gujarat and Rajasthan for the vast solar power
capacities installed, it was among the first states to implement a solar power
project with the specific target to fulfill the Renewable Purchase Obligation
(RPO).
In 2012 the Odisha Renewable Energy Development Agency awarded a 25 MW solar photovoltaic project specifically to help the state distribution company to procure enough solar power to meet the RPO target. The agency subsequently awarded another 25 MW project with the same intent.
The state has a solar power potential of 10,000 MW which
makes it an attractive candidate for any solar power infrastructure expansion
in India. No utility-scale solar power projects from the National Solar Mission
have been set up or are in the pipeline in the state. Some rooftop solar power
projects are, however, operational in the state.
Being a nascent market for solar and wind energy projects,
the state government is likely to offer major incentives to private project
developers. The state has a robust program that has successfully attracted
investments from independent power producers in the past. Private solar energy project
developers may be attracted through a comprehensive inclusion of a Renewable
Energy Certificate (REC) scheme which still offers more attractive tariffs than
those realized through competitive auctions.
While the scope of the impending policy would be
medium-term, Odisha should consider components of a long-term policy as well.
Being a coastal state, it will have an opportunity to tap offshore wind energy
resources once the central government gives a go-ahead.
The central government is set to launch the National Wind
Energy Mission which is likely to be a second impetus for the sector following
the financial incentives announced in the last decade. With most of the
high-wind-density sites across India taken up by existing projects, Odisha
could see a significant surge in investment if the state government offers
favorable market conditions to the project developers.
Any renewable energy policy announced by the Odisha
government is expected to be focused at the 2022 national target to increase
the share of renewable energy-based electricity to 15% and solar power to 3%.
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