Having achieved 100 GW of renewable energy capacity within schedule, the pace to attain the remaining target is being set with able national and international support
Never before has sustainability-linked investments attained such significance as in the present times that is driving fresh investors to scout for renewable energy opportunities in India. The green energy mission in the country is gradually moving ahead and consolidating its presence with systematic approach. While the sector saw a slump with even doubts creeping in about the attainment of its set target, there is renewed hope supported by favourable policy measures and investments. According to a recent ICRA assessment, the renewable energy (RE) sector is likely to see an investment to the tune of approximately Rs. 2.5 lakh crore to Rs. 3 lakh crore in the coming times.
Prime Minister Narendra Modi in his Independence Day speech this year shared that the country has set a target of 450 gigawatts (GW) of renewable energy capacity by 2030, with the country's whole renewable energy portfolio at 146 GW. He lauded the efforts of the Power Ministry for achieving the 100 GW target well within schedule. India is the sole G20 nation whose actions are in concurrence with the Paris Climate agreement with regard to the global rise in temperature. The renewable sector in the country presently accounts for 22 percent of the total installed capacity of about 357 GW.
Local and global investors have been pledging their support in making the country's green energy mission a reality with the renewable sector in the country showing improved maturity over the past few years. In one of the most recent developments, Denmark has come forward to ink collaborations and offer support in the various renewable energy projects in the country. Union Power and New & Renewable Energy Minister R K Singh met the Danish energy minister Dan Jorgensen to establish collaborations and according to a statement issued by the Ministry of New and Renewable Energy both the ministers agreed to create and strengthen engagement in renewable energy, especially offshore wind and green hydrogen.
Elaborating on the potential of green energy, the Energy Minister stated that the country is looking at making Ladakh and islands such as Andaman & Nicobar and Lakshadweep green in energy including transport. According to a statement by the ministry, the two ministers jointly launched the 'Centre of Excellence on Offshore Wind' as part of the Green Strategic Partnership, which at the outset will be centred on four working groups. These would include spatial planning, financial framework conditions, supply chain infrastructure and standards, and testing.
According to the Ministry, “It is planned that in the initial phases, the centre of excellence (CoE) will focus on the offshore wind sector. In the medium to long term, the vision is that the Centre will broaden to include a wider group of international governments and players, accumulating experience and best practices on offshore wind and become an international centre for offshore wind and with broader links to new and renewable energy”. The government has consistently shared that renewable energy and energy efficiency are two of key pillars of the country’s climate change strategies.
According to official statistics, India is currently poised at 4th spot in the world in terms of installed RE capacity, 5th in solar and 4th in wind in terms of installed capacity. "While 100 GW has been installed, 50 GW is under installation and 27 GW is under tendering. India has also enhanced its ambition to install 450 GW of renewable energy capacity by 2030. If large hydro is included the installed RE capacity increases to 146 GW," shared the energy minister in an official statement.
Mission Renewable spreads wings
Contributing towards expanding the renewable footprint, Tamil Nadu is also likely to see a $5-10 billion renewable sector investment with Danish participation, including an energy island in the Gulf of Mannar. A contingent of experts from Denmark, led by Energy Minister Dan Jorgensen, met Chief Minister M K Stalin to take the discussions further. The island may produce 4-10 GW taking the state's green footprint forward and also be the country's first offshore floating wind park.
A number of other initiatives are also being announced to ramp up the green energy sector in the state. Recently Tamil Nadu Generation and Distribution Corporation (Tangedco) had announced its plans to come up with 20,000 Mw of solar power projects with adequate battery storage, 3,000 Mw of pumped storage hydroelectric projects, and 2,000 Mw of gas-based power units in the next 10 years. These projects are expected to require loans of around Rs 1.32 trillion.
As the industry lauds and makes most of the favourable policies and regulations enacted by the government to boost the clean energy sector, collaborations and investments are rising. "India has been aggressively pushing for energy efficiency improvements for the past two decades through a combination of innovative market mechanisms and business models, institutional strengthening and capacity building, as well as demand creation measures," Minister RK Singh said at a recent industry event.
The minister further added that the power sector had achieved the milestone of 100 GW (giga-watt) of installed renewable energy capacity. “While 100 GW of capacity has been installed and operationalised, 50 GW of additional capacity is under installation and another 27 GW is under tendering process”, he said.
Not to miss is the fact that Mukesh Ambani-led Reliance Industries is in the process of investing a substantial amount of Rs 75,000 crore in the segment of green energy solutions. Sharing his views at the International Climate Summit 2021, Ambani shared that Reliance has already begun building the green energy complex in Jamnagar. This would comprise of four Giga factories for solar cells, advanced battery storage systems, hydrogen manufacturing, and hydrogen fuel cells.
Official statistics state that approximately 38.5 per cent of India’s installed power generation capacity is based on clean renewable energy sources and with this pace, we will reach the target of 40 per cent by 2023. The energy minister said that the key was to allow the regulatory and policy support to keep the sector afloat till the supply-side strengthens, technology developed, and the competitive market took root resulting in a fall in prices, and the industry became self-sustainable. He shared that it was anticipated that by 2050, 80-85 per cent of India’s overall power capacity would come from renewable energy sources.
“India as a global champion for the energy transition is taking the lead to support a global energy transition that is just, inclusive, and equitable and it will be a pleasure to discuss with other countries as to what paths they are adopting for de-carbonisation,” RK Singh averred. Intergovernmental Panel on Climate Change (IPCC) in their recent report had recognized emissions and human activities as key drivers of climate change. The country is planning and hoping to reduce its carbon footprint by 33-35% from its 2005 levels by 2030 and meet 40% of its electricity needs from non-fossil fuel sources by then. This is a part of its commitments to the United Nations Framework Convention on Climate Change adopted by 195 countries in Paris in 2015.
Taking the momentum ahead, the Ministry of Power has placed Green Energy Draft Rules 2021 on their website that is proposed for purchase and consumption of green energy including the energy from Waste-to-Energy plants. The green energy draft rules have provided details such as Renewable Purchase Obligation (RPO); Green energy open access; Nodal Agencies; Procedure for grant of green energy open access; banking; and cross subsidy surcharge. The Green Energy Tariff draft rule states that "The Tariff for the Green Energy shall be determined by the Appropriate Commission, which may comprise of the average pooled power purchase cost of the renewable energy, cross-subsidy charges (if any) and service charges covering all prudent cost of the distribution licensee for providing the green energy".
In terms of the Green Energy Open Access, "The Appropriate Commission shall put in place regulations in accordance with this Rule to provide Green Energy Open Access to consumers who are willing to consume the Green energy. All applications for open access of Green Energy shall be granted within a maximum of 15 days. Provided that only Consumers who have contracted demand/sanctioned load of hundred kW and above shall be eligible to take power through green energy open access. There shall be no limit of supply of power for the captive consumers taking power under green energy open access," states the draft rule.
To make a successful transition into adopting cleaner energy economy substantial investments and efforts will be needed to develop climate resistant grids. These are also the need of the hour to mitigate risks as natural disasters owing to rampant climate change have become a common occurrence causing huge dents into the present infrastructure across the globe. Adopting decentralized renewable energy solutions will also help the country to achieve its target of installing 450 GW of renewable energy capacity by 2030.