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Uncertain policies and regulatory hurdles hinder renewable energy sector

According to reports, India’s renewable energy sector , a key plank of the country’s plan to cut emissions, is feeling the pinch of policy uncertainty and regulatory hurdles, unsettling entrepreneurs who were gearing for spectacular growth.

Renewable power producers were enthused by the National Action Plan on Climate Change ( NAPCC ), which had set a target of boosting the share of renewables in India’s energy mix to 15%.

However, the Ministry for Renewable Energy’s new strategic plan has scaled it down to 6%. The current share is about 3.5-4%

“Out of the blue, the ministry seems to have taken a U-turn. There is a lot of confusion among stakeholders,” said a senior executive of a wind power generator, who did not want to be identified as the sector counts heavily on government support.

Other executives said the development had a positive side. “There are many agencies participating in the process. But it is good that other ministries and government bodies are taking interest, said Gagan Vermani, an executive director at Sunborne Energy Technologies that is involved in solar energy.

The new strategic plan sets a total target 21,700 megawatts (MW) for the next six years, taking the cumulative share of renewables to 41,400 MW.

India’s renewable energy strategy leans heavily on wind and solar energy.

The country is already among the leading producers of wind energy in the world, and has also actively encouraged solar power in recent years.

The projected increase in solar capacity can reduce India’s carbon emissions by 2.5%, which is a tenth of the 20-25% reduction India has volunteered at the international summit on climate change in Copenhagen, KPMG says. Solar power producers are also worried about the slow progress of a scheme that makes it mandatory for distribution companies to purchase some amount of renewable energy.

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