“Coal generation has continued to decline, while renewables have shown more resilience across major markets in the US, Europe, China and India,” stated the report.
NEW DELHI: The clean energy transition might be accelerated due to the covid-19 pandemic that has shown that power markets prefer renewable energy amidst falling demand, a Moody’s report suggests.
“Coal generation has continued to decline, while renewables have shown more resilience across major markets in the US, Europe, China and India,” stated the report.
The power demand in India has fallen by 20% due to the lockdown, with most of the impact on coal generation, they added.
Both corporate as well as household power demand are expected to be heavily affected by recessionary growth and weaker long-term growth expectations. The production of conventional sources of energy such as coal and oil has also dropped, said the agency.
Renewable energy made up the bulk of recent capacity additions both in India and the world over, which continues to displace thermal generation. With a sharp decrease in power demand due to the lockdown, this trend is expected to continue, said Moody’s.
“COVID-19 could have a ratchet effect, limiting any rebound in coal generation, and accelerating the decline of coal in the US and Europe by a few years,” said the ratings agency.
Moody’s also predicts an increase in the use of biofuels, electric vehicles and improvements in their engine efficiencies will add to the likelihood of oil demand eroding over time. Although most developed countries have set targets and incentives that would require a rapid adoption of electric vehicles in the next ten years, India has not constituted such a policy yet.
Source: economictimes.indiatimes
