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India to increase the installed capacity of renewables to 500GW by 2030

  • Category
    Economy
  • Published
    23rd Nov, 2021

Context

At the recently concluded COP26 summit in Glasgow, Prime Minister Narendra Modi announced that India would increase the installed capacity of renewables to 500GW by 2030.

Background

  • While the government's earlier plan was to ramp up renewable capacity of 450 GW, another 50 GW has been added to the target.
  • India, until now, has been able to achieve only a fourth of this target.

Renewable Energy

  • Renewable energy is energy derived from natural resources (sunlight, wind, rain, tides, waves, biomass, and thermal energy) that replenish themselves in less than a human lifetime without depleting the planet’s resources.
    • available in one form or another nearly everywhere
    • virtually inexhaustible
    • emits no or low greenhouse gases (better for climate)
    • emits no or low air pollutants (better for health)
    • Low cost
    • Makes the energy system resilient
    • Accessible to all
  • Fossil Fuels: Today, the world still heavily relies on fossil fuels (oil, coal, and natural gas) and even continues subsidizing them. They are responsible for:
    • pollution
    • causing climate-damaging greenhouse gases
    • releasing health-endangering particles
    • available in finite quantities only

Analysis

Indian renewable energy sector

  • The Indian renewable energy sector is the fourth most attractive renewable energy market in the world.
  • Renewable power installed capacity: India was ranked fourth in wind power, fifth in solar power, and fourth in renewable power installed capacity, as of 2020.
  • Installed renewable power generation capacity has gained pace over the past few years, posting a CAGR of 17.33% between FY16-20.
  • With the increased support of the Government and improved economics, the sector has become attractive from an investor's perspective.
  • As India looks to meet its energy demand on its own, which is expected to reach 15,820 TWh by 2040, renewable energy is set to play an important role.
  • As of August 2021, India had 100.68 GW of renewable energy capacity, and represents 25.2% of the overall installed power capacity, providing a great opportunity for the expansion of green data centers.

Commitment to become a ‘net-zero nation’

  • India has committed to becoming a net-zero nation, that is it will offset its emission impacting the climate, by 2070.
  • The coal phase down will mean a developing country like India will have its resources like coal to meet energy requirements without putting a timeline to end usage of the fossil fuel.
  • This phase down will give a breather to recently commissioned coal-based plants that may have a life cycle of another 20-30 years.
  • At present, India has a 200 GW electricity generation capacity based on coal.

What does India need to do for the new target?

  • The country had already installed 39%of this target, but the new target is ambitious.  India had 154 GW of non-fossil-fuel-based generation capacity.
  • So in the nine years until 2030, India will have to add about 38 GW a year to its installed capacity to meet the 500-GW target.
  • This in turn is a significant problem because the Indian government’s program to build such projects in the northern states, especially in Uttarakhand of late, has been antidemocratic, ecologically damaging, and unsustainable in the long run.
  • As such, experts in the country have characterized these projects as an anti-scientific quest for (electric) power at the cost of the ability of the people, the land, and the wildlife around these projects being able to withstand climate shocks.

What about the coal sector?

  • Since coal has to play a role of primary fuel for power generation in the country for the time being, till renewable source fully caters to our energy demand, the Ministry of Coal in line with the commitment has already moved forward with a comprehensive Sustainable Development Plan.
  • Action has already started for its speedy implementation.
  • Emphasis is to put a major thrust on sustainable development in coal mining, taking care of its environmental and social impact.
  • Important measures include:
    • Bio-reclamation of mined-out land has already been taken up on a big scale by all coal companies through a massive tree plantation drive to help in having carbon sink potential to the tune of more than one lakh tonne per annum.
    • First-mile connectivity (FMC) is a major initiative by coal companies to minimize environmental pollution, where coal is being transported through a conveyor belt from coal handling plants to the silo for loading
    • Surface coal gasification projects have been planned for syngas production to be used further either for the production of methanol/ethanol, urea, or petrochemicals.
    • Extraction of sand from overburden (OB) dump for use in construction is another unique initiative for sustainable development.

How this new target is different from the previous set target?

  • The 500 GW is a version of the target set by Modi at the 2019United Nations Climate Action Summit in New York when he announced that India would aim to install 450 GW of renewable energy electricity generation capacity by 2030.
  • But there are two crucial differences between the New York summit and COP26 announcements.
    • First, the New York announcement wasn’t part of India’s commitment under the Paris Agreement.
    • Second, it was worded as “renewable electricity generation capacity” as opposed to “non-fossil-fuel generation capacity”.
  • This means the target India has now committed to under the Paris Agreement includes large hydroelectric projects.

Major issues faced by India

  • The country grapples with the intertwined issues of
    • air pollution
    • water scarcity
    • energy security
    • energy access
    • affordability

Regulation of renewable energy sector

  • Concerned organization
  • Ministry of New and Renewable Energy (MNRE), is the nodal unit for all matters relating to Renewable Energy.
  • India Renewable Energy Development Agency (IREDA), is a public limited company established in 1987 to promote, develop and extend financial assistance for RE and energy efficiency/conservation projects.
  • Important initiatives taken by Government

Some initiatives by the Government of India to boost India’s renewable energy sector are as follows:

  • Encourage consumers: In August 2021, the government proposed new rules for the purchase and consumption of green energy to encourage large-scale energy consumers to leverage renewable energy sources for regular operations.
  • Rooftop Solar Programme Phase II: To encourage rooftop solar (RTS) throughout the country, notably in rural regions, the Ministry of New and Renewable Energy plans to undertake Rooftop Solar Programme Phase II, which aims to install an RTS capacity of 4,000 MW in the residential sector by 2022 with a provision of subsidy.
  • India Renewables Dashboard: The Central Electricity Authority (CEA) and CEEW’s Centre for Energy Finance (CEEW-CEF) jointly launched the India Renewables Dashboard that provides detailed operational information on renewable energy (RE) projects in India.
  • Draft National Electricity Policy (NEP) 2021: The Ministry of Power (MoP) released the draft National Electricity Policy (NEP).
  • Gram Ujala: India introduced Gram Ujala, an ambitious program to include the world's cheapest LED bulbs in rural areas for Rs. 10 (US$ 0.14), advancing its climate change policy and bolstering its self-reliance credentials.
  • Green Energy Corridor Scheme: In the Union Budget 2021-22, Ministry for New and Renewable Energy was allocated Rs. 5,753 crore (US$ 788.45 million) and Rs. 300 crore (US$ 41.12 million) for the ‘Green Energy Corridor’
  • Encouraging domestic production: To encourage domestic production, customs duty on solar inverters has been increased from 5% to 20%, and on solar lanterns from 5% to 15%.
  • Measures by Indian Railways: Indian Railways is taking increased efforts through sustained energy efficient measures and maximum use of clean fuel to cut down emission levels by 33% by 2030.

Conclusion

The energy sector is set to undergo a drastic transformation across the globe and the future belongs to renewable energy. This is going to be a collective effort. It is now hoped that this transition will be inclusive and equitable so that no one is left behind.

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