India is undergoing an energy transition from fossil-based to clean energy. Our quarterly Market Handbook helps identify and analyse trends, present data-backed evidence and connect the dots to present a short-term market outlook. India is undergoing an energy transition from fossil-based to clean energy. Our quarterly helps identify and analyse trends, present data-backed evidence and connect the dots to present a short-term market outlook.
Key Findings
  • Total generation in Q2 FY23 was up by 6.8% compared to Q2 FY22 and reduced by 2.8% in comparison to Q1 FY23 owing to above-normal rainfall during June-September.
    • July: Up by 4.3%
    • August: Up by 3.2%
    • September: Up by 13.7%
    • Total Q2 FY23: Up by 6.8%
  • In Q2 FY23, RE generation increased by 12.1% versus the same quarter in the previous fiscal year (Q2 FY22). Coal/lignite-based generation was up by 6.2% and hydro by 12.0% for the same period.
  • From an average daily generation perspective, the share of RE and hydro increased, whereas coal share declined in Q2 FY23 compared to Q2 FY22.
    • RE: Share up from 12.3% to 12.9%
    • Hydro: Share down from 16.5% to 17.3%
    • RE + Hydro: Almost constant from 28.8% to 32.2%
    • Coal/lignite: Share up from 66.2% to 65.8%
Figure 1: Source-wise daily generation
Source: POSOCO. Note: RE technologies include solar, wind, biomass, waste-to-energy, and small hydro and do not include rooftop solar and large hydro (>25 MW) generation.
  • The overdue amount payable by discoms to power producers increased by 17% in Q1 FY23 (INR 1,12,084 crore) compared to Q4 FY22 (INR 95,605 crore) and increased by 8% compared to Q1 FY22 (INR 1,03,574 crore).
  • From a payment delay standpoint, as of March 2022, Telangana, Andhra Pradesh, Uttar Pradesh, Rajasthan and Chhattisgarh took more than 120 days to clear their dues.
Figure 2: Discom payable and receivable days for RE-rich states
Source: UDAY portal (based on data disclosed by discoms as of 31 March 2022). *Data not available for these states; values derived from 2019–20/ 2020–21 financial reports.
  • In Q2 FY23, most of the listed RE stocks (except the NYSE-listed solar project developer Azure Power) gained momentum and fared upward.
  • The share price of RE developer Adani Green Energy was up by 17%, and that of Sterling and Wilsonwas up by 4% as of September 2022 (vs June 2022).
  • The stock prices of wind developer–manufacturers Inox Wind and Suzlon Energy were up by 87% and 28% in September 2022 (vs June 2022), respectively.
Figure 3: Change in key renewable energy stock prices (indexed to 100)
Source: Money Control.
Note: Share prices are the last traded value in each month.
  • Continuing the trend since the beginning of FY23, in Q2 FY23, no new green bonds by RE developers were issued.
  • Key bond yields in India, including the 10-year Treasury bond yield, continued to see an uptick in Q2 FY23 against the backdrop of rising interest rates, coinciding with the rupee falling to a record low in September 2022.
Figure 4: Bond yields* and key financial rates
Source: Reserve Bank of India, State Bank of India, Trading Economics, Money Control and BondEvalue.
Note: Bond prices are the last traded value in each month; * Current yield.

Key Indicators
Share of RE in Q2 FY23
12.9%
up from 12.3% in Q2 FY22
Capacity auctioned
3.51 MW
in Q2 FY23
Amount overdue to power producers as of June 2022
INR 1.12 lakh crore
Up 8% from June 2021
Market concentration for RE auctioned capacity
57%
in Q2 FY23
Author's Name
Ruchita Shah
Programme Associate
For queries reach out to author
[email protected]
Tags
Energy Transition
Discoms
RE Developers
RE Auctions
Green Bonds
EV
Power Markets
Clean Energy Investments
Energy Storage