Climate Risks Threaten 90% Of India's Planned Renewable Energy Capacity: Study

New Delhi, Jun 25 (KNN) Nearly 90 percent of India's planned renewable energy capacity could face significant exposure to climate-related risks by the end of the decade, placing an estimated USD 55 billion worth of assets at risk, according to a study by Zurich Insurance Group.
 
The assessment found that around 239 GW of proposed solar, wind and hydropower capacity across 10 states is vulnerable to high or critical climate hazards, including extreme floods, wildfires, hailstorms and tornadoes, reported Bloomberg.
 
Climate Risks Pose Challenge to Clean Energy Expansion 
 
The findings highlight a growing challenge for India as it accelerates its clean energy transition and works towards increasing the share of non-fossil fuel-based electricity generation capacity to 60 percent by 2035.
 
According to the report, climate-related disruptions could affect both the operational efficiency and financial viability of renewable energy projects. 
 
Infrastructure Damage Could Impact Project Economics 
 
Damage to infrastructure such as solar panels and wind turbines could result in reduced power generation, revenue losses and higher repair costs.
 
The study noted that developers are increasingly being required to demonstrate climate resilience measures to secure financing, as investors and insurers place greater emphasis on managing physical climate risks.
 
Solar Projects Identified as Most Vulnerable 
 
Solar projects face the highest level of vulnerability, accounting for nearly 70 percent of the 871 planned renewable energy assets assessed in the study. 
 
While project developers generally account for risks associated with high winds, the report noted that hazards such as hailstorms receive comparatively less attention despite posing a significant threat in major solar hubs such as Rajasthan and Gujarat.
 
Hailstorms and Droughts Threaten Solar Performance 
 
Beyond visible damage, hail impacts can cause microscopic fractures in solar panels, gradually reducing their efficiency and affecting long-term power output. 
 
In arid regions, prolonged drought conditions can further reduce performance by increasing dust accumulation on panels and raising maintenance costs associated with cleaning.
 
Early Resilience Investments Can Cut Losses Significantly 
 
The report estimates that projected climate-related losses could be reduced by nearly half, from USD 55 billion to USD 27 billion, through early investments of approximately USD 4.6 billion in resilience and risk-mitigation measures.
 
The findings underscore the need for climate-resilient infrastructure planning as India continues to expand renewable energy capacity to meet its long-term energy security and decarbonisation goals.
 
(KNN Bureau)