Today, India has 141 GW of installed capacity of Renewable Energy [RE] making it the fourth largest installed capacity globally – with fourth largest for wind and fifth largest for solar. The effort towards achieving this feat started long back in 1992, when India was one of the first countries to set up a Ministry of Non-Conventional Energy Sources, renamed the Ministry of New and Renewable Energy [MNRE] in 2006. This is a testimony to India’s mission to propagate clean energy sources since the early days of sustainable development. The Government of India has since then taken multiple initiatives to promote generation and adoption of RE to fuel the country’s growth and development. India has also set for itself, the world’s largest RE expansion plan – achieving 175 GW by 2022 and 450 GW by 2030 in installed capacity. The RE installed capacity has already seen a 226 percent increase in the last 5 years.
*Large Hydro capacity as of May 31, 2021
During COP21 in 2015, India led the way for global energy transition by declaring ambitious commitments- 33-35 percent reduction in the emissions intensity below 2005 levels and increase in the share of non-fossil fuels in the total installed capacity to 40% by the year 2030. India is well on its way to achieve these targets and has already registered a 24-percent drop in its emissions intensity. The 2020 Climate Transparency report said India is the only country, among the G20 nations, doing its share of actions to make it compatible with the goal of curbing global warming by 2 degrees Celsius by the end of this century. Additionally, as per a report by Central Electricity Agency (CEA), it has been reported that the percentage of non-fossil fuel in India’s electric installed capacity is estimated to increase to 64% by March 2030, well surpassing our 40 percent commitments. Currently, this share stands at about 37 percent of the country’s total capacity (as of June 16, 2021).
India has also been designated as a ‘Global Champion’ for energy transition at the UN High Level Dialogue on Energy and also ranked 3rd in EY Renewable Energy Country Attractiveness Index. Many breakthrough projects have been developed in the country which have led to these achievements. The Cochin international airport in Kerala is the world’s first airport to fully run-on solar power and has recently commissioned a floating solar project of 452 Kwh capacity. The world’s largest RE park in state of Gujarat is expected to produce 30 GW through solar-wind hybrid projects. As of December 2020, 42 solar parks with cumulative capacity of 26.8 GW have been also approved in India.
Several measures have been taken up not only to set-up RE projects but also to make RE available across the grid through reliable connections. Tenders are being released for procurement of RE through development of Inter-State Transmission Systems [ISTS]. Initiatives like Tariff Based Competitive Bidding (TBCB), Renewable Power Obligations (RPO) and Renewable Energy Certificates (REC) further promote the adoption and generation of RE and also keep consumer interests in mind. TBCB resulted in the lowest tariff being achieved in solar at INR 2 per unit in Rajasthan in November 2020 and INR 1.99 per unit in Gujarat in December 2020. In addition, energy projects constitute roughly 24% of the total capital expenditure envisaged under the $1.7 trillion Nation Infrastructure Pipeline initiative during Financial Year (FY) 20-25.
The evolving energy landscape in India provides numerous investment opportunities in the RE sector along with a liberal Foreign Direct Investment (FDI) policy by allowing 100 percent FDI through automatic route. India’s RE sector has already received investments worth $70 billion in the last 7 years and presents additional business prospects worth $20 billion for the next decade. Many leading international energy players have been keenly investing in India’s RE sector in last few years. France-based Total Group acquired 20 percent stake in Adani Green Energy Limited worth $ 2.5 billion last year. ORIX Corp invested $980 million in wind assets of Greenko Energy Holdings, which has existing investments from sovereign funds GIC & ADIA worth $2.2 billion. In May 2021, Virescent Infrastructure acquired 76 percent of India’s solar asset portfolio of Singapore-based Sindicatum Renewable Energy Company Pte Ltd.
The RE sector is also one of India’s champion sector under the Make in India campaign. The wind sector in India has immensely grown over the last few years and now boasts of a robust domestic manufacturing ecosystem. India has a current annual production capacity of 8 -10 GW being manufactured with state-of-the-art technologies. India’s forward-looking approach and growth is acknowledged through the presence of significant wind turbine and component manufacturers from across the globe. India has achieved 70-80 percent of indigenization of wind turbines and over 17 different companies including major global players are manufacturing 44 different models of wind turbines in India. The solar sector has also been showing tremendous growth in India. The domestic manufacturing industry has annual capacities of around 2.5 GW for solar Photo Voltaic (PV) cells and 9-10 GW for solar PV modules. The domestic manufacturing capacity is expected to be scaled up to 10 GW capacity of integrated solar PV manufacturing plants (from manufacturing of wafer-ingot to high efficiency modules) by Q4 of 2022-23 via the Production Linked Incentive (PLI) Scheme which has been recently announced for high efficiency solar PV modules.
Expected to generate power by 2022-23, the world’s largest (600 MW) floating solar project is being constructed in Madhya Pradesh with an estimated investment of $408 million. The project is set to have 450,000 photovoltaic panels covering 450-acre area of the reservoir with the possibility of future expansion. More such floating solar projects across all thermal power plants in India are being planned. To keep pace with global companies, National Hydrogen Mission was announced in the budget speech of FY 2021-22 to produce the hydrogen from green energy sources. Many companies like Indian Oil Corporation Limited (IOCL), Reliance and Tata are working on demonstrator projects in this space to generate green hydrogen for internal consumption.
Operated by Tata Power-Delhi Distribution Limited (DDL), India has already operationalised its first grid-scale battery substation in March 2019, located in New Delhi. Recently, the American electric vehicle and clean energy company Tesla Inc. marked its entry into India by incorporating its subsidiary, Tesla India Motors and Energy Pvt Ltd, in Bengaluru. Ola electric announced its plan to set up the world’s largest electric scooter plant in Bengaluru at a cost of $330 million, aiming to produce 2 million units a year. The company plans to scale up production by 2022 to produce 15 percent of the world’s e-scooters.
While India has made significant achievements in the clean energy space, the country is focused on continuously upgrading its policies and infrastructure to continue leading the clean energy transition, globally.