India stands at a pivotal moment in its pursuit of India’s sustainable energy future. As the most populous nation and a rapidly expanding economy, the task of fulfilling energy needs while honoring global climate obligations presents a formidable challenge.
Nevertheless, with progress in renewable energy technologies, green hydrogen initiatives, and energy storage solutions, India is making significant strides toward its clean energy objectives.
This transition is essential not only for ensuring energy security but also for addressing climate change risks and fostering sustainable economic development.
India’s sustainable energy efforts are a cornerstone in the global fight against climate change, showing the nation’s commitment to a greener and more resilient future.
The Future of India’s Sustainable Energy Landscape
The Importance of Coal in Energy Stability
Coal continues to be a fundamental component of India’s energy framework, providing essential grid stability and fuel security.
Even with the increasing adoption of renewable energy sources, coal plays a crucial role in generating employment, contributing to government revenues, and facilitating transportation.
The record levels of coal production in the fiscal year 2023-24 highlight its ongoing significance in fulfilling base-load power demands.
Enhancing Renewable Energy Capacity
India has established an ambitious goal of reaching 500 GW of renewable energy capacity by 2030, along with a 45% reduction in greenhouse gas emissions intensity.
Over the last decade, the nation’s renewable energy capacity has experienced impressive growth, rising from 78 GW in FY 2014-15 to 199 GW in FY 2023-24.
Solar energy has been the frontrunner, representing nearly 80% of the new capacity additions.
To achieve the 500 GW target, India currently has 90 GW of renewable projects underway and an additional 44 GW in the development phase.
Furthermore, the government intends to issue tenders for 50 GW annually until FY 2027-28, thereby reinforcing India’s dedication to clean energy initiatives.
Driving the Expansion of Renewable Energy in India
The Advancement of Solar and Wind Energy
India’s solar energy industry is witnessing significant growth, marked by a compound annual growth rate (CAGR) of 36.5%.
Programs such as PM KUSUM and PM Surya Ghar-Muft Bijli Yojana are designed to facilitate the installation of 30 GW of residential solar capacity.
Concurrently, the wind energy sector, which has an installed capacity of 46.42 GW, is progressing through initiatives involving offshore projects, turbine repowering, and hybrid energy solutions.
Hydropower and Green Hydrogen Developments
The capacity for hydropower is anticipated to increase by more than 50%, reaching 67 GW by the fiscal year 2031-32, although challenges persist in the North-Eastern and Northern regions.
Simultaneously, India’s green hydrogen sector is positioned for rapid growth under the National Green Hydrogen Mission, which targets the production of 5 million metric tons (MMT) by 2030.
Backed by investments amounting to INR 19,744 crore, this initiative aims to establish India as a frontrunner in hydrogen-based energy technologies.
Energy Storage Potential Unleashed
Battery Energy Storage Systems (BESS) and Pumped Storage Projects (PSP)
As India enhances its renewable energy capabilities, the need for effective energy storage solutions is increasing.
The government is vigorously supporting Battery Energy Storage Systems (BESS) and Pumped Storage Projects (PSP) through various financial incentives and regulatory measures.
A significant development is the establishment of a 40 MW BESS facility in Chhattisgarh, which represents a major advancement in grid integration.
By the fiscal year 2031-32, it is anticipated that India’s BESS capacity will reach 47.23 GW, thereby bolstering grid stability and facilitating the smooth incorporation of renewable energy sources.
The Contribution of Electric Vehicles to Energy Transition
Mitigating Transport Emissions
The transport sector in India accounts for 18% of total greenhouse gas emissions, with road transport especially heavy-duty trucks being the primary contributor.
The transition to electric vehicles (EVs) offers a practical approach to mitigate emissions and reduce reliance on fossil fuels.
Research suggests that a higher adoption rate of EVs could lead to an 18% reduction in CO2 emissions and generate savings of approximately US$14 billion in oil imports by 2030.
Enhancing Charging Infrastructure
In spite of the momentum towards EV adoption, India’s charging infrastructure is still lacking, with only one charging station available for every 135 EVs, which is significantly below international benchmarks.
To remedy this situation, the government has launched initiatives such as FAME, PM E-Drive, and PLI schemes, in addition to implementing state-level policies and lowering GST on lithium-ion batteries.
Financing India’s Transition to Green Energy
The Necessity for Substantial Investments
Realizing a sustainable energy future for India necessitates an annual investment ranging from US$150 to US$200 billion.
In contrast, during the fiscal year 2019-20, India secured only US$44 billion, revealing considerable financial shortfalls.
Major obstacles include substantial capital demands, extended payback durations, and inherent technological uncertainties.
Government Efforts to Attract Capital
To address the funding deficit, India has launched various financial mechanisms, including sovereign green bonds, green deposit regulations, and the BRSR framework established by SEBI.
There has been a notable increase in investments in solar, wind, electric vehicles, green hydrogen, and energy storage, with climate technology funding experiencing a fourfold increase since 2019.
Furthermore, public-private partnerships and development finance institutions are pivotal in mobilizing private investments.
Enhancing India’s Energy Infrastructure
Upgrading Transmission Networks
India is in the process of modernizing its electricity transmission infrastructure to support the growing capacity of renewable energy.
The National Electricity Plan proposes policy reforms such as Point of Connection (PoC) charges and Grid Network Access (GNA) mechanisms, which aim to improve market efficiency and grid dependability.
Strengthening the Distribution Sector
The privatization of electricity distribution has resulted in enhanced efficiency in urban areas such as Delhi, Odisha, and Bhiwandi, leading to a reduction in Aggregate Technical & Commercial (AT&C) losses.
However, extending these advancements to rural regions poses challenges, including job security concerns, the viability of state-owned distribution companies, and political opposition.
To address these challenges, the National Electricity Plan 2022-32 endorses privatization through approaches like the Distribution Franchisee Model (where private operators do not own assets) and the Distribution Licensee Model (where private entities oversee both assets and operations).
A phased and regionally tailored strategy will be crucial for effective implementation.
The Future of India’s Energy Sector
India is positioned to play a pivotal role in the global energy transition, actively pursuing a sustainable energy future.
The nation is making significant strides in renewable energy, green hydrogen, and energy storage technologies, thereby advancing its clean energy goals.
Nevertheless, this path is intricate and necessitates a comprehensive strategy that encompasses policy reforms, financial innovation, and technological progress.
Effective collaboration between the public and private sectors, along with a varied energy portfolio, will be essential for achieving enduring energy security and fostering economic development.
Expert Editorial Comment
As India forges ahead in its commitment to a sustainable energy future, it is reaffirming its dedication to international climate objectives.
While the transition poses various challenges, strategic investments and supportive policies position India to take a leading role in clean energy innovation globally.
Ultimately, the move towards a sustainable energy framework will not only bolster energy security but also reinforce India’s status as a leader in global sustainability efforts.
By prioritizing India’s sustainable energy goals, the nation is paving the way for a greener, more resilient future, setting an example for other countries to follow.
