Can India Take Advantage Of Its Enormous Green Energy Potential?

Editor OilPrice.com
Sat, January 28, 2023 at 3:00 PM MST·4 min read

“The world needs India to avert climate catastrophe,” a CNN headline blared late last year, before asking the crucial follow-up question: “Can Modi deliver?” India aims to reach net-zero carbon emissions by 2070, but so far progress on climate goals has been uneven, to say the least. The South Asian nation’s decarbonization progress over the coming months and years can make or break the global fight to keep average temperatures at or below 2 degrees Celsius above pre-industrial averages. India currently produces the third-most carbon dioxide emissions in the world, after China and the United States.

As India has industrialized and its population has continued to grow, the subcontinent’s energy needs have skyrocketed. According to figures from the International Energy Agency, Indian energy consumption has more than doubled since the year 2000, and over 900 million Indians have gained access to electricity over the last two decades. And the country is just starting its development journey. India’s federal power ministry projects that national electricity demand will expand by up to 6% every year for the next ten years. India is on track to overtake China as the most populous country in the world, and it has already established itself as a major economic and cultural force on the global stage.

India also has some of the greatest potential for green energy production in the world, creating a massive opportunity for Modi’s India to place itself at the forefront of the green energy revolution and give the economy – currently bogged down by high energy prices on the global market – a major boost. According to a brand new report from the Global Energy Monitor, India is in the top seven countries for prospective renewable power. The country already has plans for gargantuan solar and wind farms in the works, and if the country’s planned buildout of 76 gigawatts of solar and wind power by 2025 comes to fruition, it will successfully avoid the use of almost 78 million tons of coal per year, leading to savings of up to 1.6 trillion rupees ($19.5 billion) annually.

While these projects are a major step forward for India, and the savings could serve as a major incentive to keep going, getting to carbon neutrality by 2070 is going to take a lot more investment – and a lot more grit. While green energy is gaining a foothold in India, it’s going to be very, very difficult to wean the subcontinent off of coal. India depends on fossil fuels for 70% of its energy mix, with coal taking the lion’s share. According to figures from ember-data, India installed 168 gigawatts of coal-fired generation from 2001 to 2021, almost double the addition of solar and wind energy combined over the same period.

At present, just 10% of India’s energy mix comes from renewable energies, and the country missed its 2022 target to install 175 gigawatts of renewable energy to the total level of domestic power production. Only four out of India’s 28 states met their renewable energy targets last year. What’s more, most of them failed by a discouragingly wide margin. “Most states have installed less than 50% of their targets and some states such as West Bengal have installed only 10% of their target,” the Associated Press reported this week. The country’s next target is to install a total of 450 gigawatts of clean energy by 2030, and meeting this is going to require a massive acceleration of India’s current rate of renewable capacity buildout.

For all of India’s investing and pledging related to building out green energy, the reality is that India just isn’t ready to give up on coal. At COP26 in Glasgow, India led a last-minute charge to change language related to phasing out coal in the conference's final joint agreement. This move highlighted the tightrope that Modi currently has to walk: India has to phase out coal for the benefit of the climate and its international diplomacy, but it also can’t sacrifice its own development and growth. For many developing countries, the current pressure to rapidly decarbonize their economies feels a lot like having to pay for the first world’s sins. Developed countries have burned fossil fuels with little to no recompense for over a century, and have robust economies to show for it. India wants its chance to do the same – an understandable enough sentiment, but a sentiment that could have devastating consequences for the entire world, now and in future generations.

By Haley Zaremba for Oilprice.com