India to spend Rs29,000 crore on renewable energy this year

India plans to add about 3,500 MW of renewable power during the current financial year, entailing a capital investment of about Rs29,000 crore, minister for renewable energy Farooq Abdullah told the Lok Sabha on Thursday.

Foreign direct investment (FDI) of about Rs4,900 crore has been received as equity inflows in the renewable energy sector during the last three years and the current year, he added in a written reply during Question Hour.

Abdullah said a recent report by independent consultants Ernst & Young ('renewable energy country attractiveness indices', May 2011) has ranked India as the third-best investment destination in the renewable energy sector, after China and the USA.

"It is envisaged that a power generation capacity of around 3,400 MW (grid interactive) and 130 MW (off-grid/captive) from various renewable energy sources, mainly wind, solar, biomass and small hydro, will be added in the country during the current financial year 2011-12," Abdullah said.

While half of the capital investment would be towards wind energy, investments in solar energy are expected to be about Rs9,000 crore. Small hydro power and bio-power projects would see investments of about Rs3,000 crore and Rs2,500 respectively, he said.

The minister said that FDI up to 100 per cent is automatically permitted in renewable energy generation and distribution projects, subject to the provisions of the Electricity Act 2003.