Although coal is expected to remain a crucial part of India’s overall energy mix in the medium term, but the way India is diversifying into renewable energy generation, it seems that India is all set for a big jump in the transition to clean energy journey.
During this journey, expected to continue for next 15-20 years, India will become not just self-sufficient in green and clean energy, but also a significant exporter of renewable energy. India is expected to be able to export $500-bn green energy over 20 years. India has now emerged as one of the most attractive places in the world for renewable energy investment. As the climate problem is an existential crisis for the world, the energy transformation will lead to a geopolitical transition as well.
India is one of the first countries in the world to announce hydrogen-powered vehicles. India has announced a new policy to split water to produce hydrogen, for which electricity from renewable sources will be used. Then this hydrogen can be utilised as a fuel in a variety of businesses, including refineries and steel factories, as well as in automobiles. India has achieved its aim of 40% renewable energy generation in 2021 only, which had been set for 2030. India wants to reach a renewable energy capacity of 500 gigawatts.
And this journey is not a linear one. Let’s see the projections. By 2030-32, India would have surpassed the European Union as the world’s third-largest economy, with nearly more than five times of its current GDP. As of now, the annual per capita carbon emissions of an average Indian is very meagre, around one-fifth of a Chinese or one-eighth of an American. But, by that time, India’s energy output will have to be increased in order to meet the requirements of double-digit GDP growth. So, the technologically affordable basis becomes mandatory for India. Simultaneously, India will have to continuously increase the ratio of green and clean energy in the augmented output.
The Government of India, besides its National Hydrogen policy, has also created a favourable regulatory and enabling environment for India’s green hydrogen and ammonia sector. For green hydrogen and ammonia projects the open access, grid finance, and faster approvals have already been provided to renewable energy companies. The inter-state transmission tariffs for green hydrogen too have been cancelled for a period of 25 years. The 30-day power banking has also been authorised by the government, which will aid in the better usage of capital-intensive electrolyzer assets.
Public sector companies such as Coal India Limited and NTPC, along with some other government owned companies and departments, too have set and announced their targets for the renewable energy sector.
Coal India Limited (CIL) is going to diversify into the renewable energy sector with an announced investment of about Rs 58 billion ($760 million) by 2024 for 3 GW of solar power projects. In April 2021, CIL established two wholly-owned subsidiaries – Solar PV Limited and CIL Navikarniya Urja Limited for manufacturing solar value chain products and for undertaking renewable energy projects. CIL announced a plan to establish a 4 GW solar PV module manufacturing plant in September 2021.
The thermal power giant – NTPC had announced in June 2021 a target of installing 60 GW of renewable energy capacity by 2032. A NTPC renewable energy subsidiary – NTPC Renewable Energy Limited is mandated to ‘build, own, and operate’ renewable energy projects. NTPC is also set to implement solar projects in the International Solar Alliance member countries.
Other public sector units like Indian Railways too have made announcements to achieve net-zero emissions by 2030, and install 20 GW of solar power plants. Similarly, the Oil and Natural Gas Corporation (ONGC), in partnership with NTPC, is setting up renewable energy projects in India and overseas. ONGC has set a target of achieving 10 GW of renewable capacity by 2040.
Private players have also made big announcements. Adani Green Energy Limited has set a target of achieving 45 GW renewable energy capacity by 2030, and last year announced an investment of $20 billion in renewable energy development over the next decade. Even bigger is the investment of about $80 billion announced by Reliance Industries Ltd, in January 2022 in green energy projects over the next 10-15 years. RIL has set the target of net-zero carbon emissions by 2035. Tata Power aspires to expand its renewable energy capacity to 15 GW by 2025 and scale up clean energy generation to 80 percent of its total power generation.
