The report highlights that these delays are measured from the Scheduled Commercial Operation Date (SCOD) specified in tender documents, which typically falls 18 to 24 months after the execution of power purchase agreements (PPAs).

Assessing Risk Premiums in Solar Investments The report evaluates risk premiums for solar power projects using two benchmarks:

P50 (Average Scenario): A balanced estimate, where there is a 50% probability that actual results will meet or exceed this level. P90 (Conservative Scenario): A more cautious estimate, used by risk-averse investors, where there is a 90% probability that actual results will meet or exceed this level. Investors use P50 and P90 estimates to assess risk tolerance. For example, if historical data shows a capacity utilisation factor (CUF) for a solar project between 18% and 22%, a risk-averse investor might assume 18%, while a less cautious investor might estimate 20%.

Key Factors Contributing to Project Delays 1. Land Acquisition Bottlenecks Land acquisition, expected to take 6-9 months, often extends to 18-24 months in some states, significantly affecting project timelines. Issues such as administrative hurdles, non-digitised land records, fragmented local regulations, and lack of centralised land policies make project development more complex and delay financial closure. 2. Grid Connectivity & Transmission Expansion Challenges General Network Access (GNA) or interstate transmission system (ISTS) connectivity takes between 4.5 and 13.5 months, depending on the need for network expansion. Transmission line construction can take 24-36 months, but delays are common due to: Right-of-way disputes Geographical barriers (rivers, hills, ecological zones) Environmental concerns, particularly the Great Indian Bustard (GIB) protection zones in Rajasthan, where construction timelines can extend up to 48 months. The Role of High-Voltage Direct Current (HVDC) Transmission To support renewable energy integration, significant HVDC transmission capacity has been planned and auctioned. However, HVDC systems take longer to commission than traditional High-Voltage Alternating Current (HVAC) networks, as they require specialised equipment such as converter stations and thyristor valves.

Future Outlook: Grid Expansion & Renewable Integration India has granted grid connectivity for solar, wind, and hybrid projects totaling 147 GW, but this capacity will only become fully operational over the next 3-5 years. Addressing land acquisition hurdles and transmission infrastructure constraints will be crucial in achieving India’s renewable energy targets and maintaining investor confidence in the sector.