Title: Exploring the impact of cross subsidy on growth of renewable energy generation capacity in India

Authors: Naveen Agarwal; Naqui Anwer

Addresses: TERI School of Advanced Studies, New Delhi, India; Great Lakes Institute of Management, Gurgaon, India ' Department of Energy and Environment, TERI School of Advanced Studies, Delhi, India

Abstract: In last few years a very rapid growth has been seen in renewable energy generation capacity addition in India. There can be number of factors which are helping in this growth and exemption of cross subsidy surcharge for open access consumers for purchasing power from renewable energy sources might also be one of them. It is required to assess the impact of cross subsidy in the growth of the renewable energy in the country as policy makers have decided to reduce cross subsidy level to make tariff sustainable for industrial and commercial consumers and in that case it may impact the current growth rate of renewable energy. This study uses the panel data of state wise renewable generation capacity and cross subsidy levels over the years. As per results cross subsidy has a significant positive impact on growth of renewable energy capacity addition.

Keywords: cross-subsidy; renewable energy; captive power plants; India.

DOI: 10.1504/IER.2020.112592

Interdisciplinary Environmental Review, 2020 Vol.20 No.3/4, pp.255 - 265

Received: 29 Nov 2019
Accepted: 12 May 2020

Published online: 22 Jan 2021 *

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