The energy crisis in this country is an urgent and growing concern. Our oil imports have doubled in the last decade; we now import around 80% of our crude oil requirements. Roughly 70% of the energy generated in India is through coal – an undependable resource now in shortage.
Consider these facts: due to an increase in demand and the fast-paced growth of the Indian economy, we will face a peak power shortage of 12.9% and an energy shortage of 10.3% this year. About 400 million people in India have limited or no access to electricity. Furthermore, India is among the top 5 emitters of Green House Gas (GHG).
This does not bode well for our country, and severely limits our ability to grow.
What to do?
We need to find innovative, sustainable solutions to meet this growing demand for energy.
Promoting Renewable Energy (RE) is one such way. Derived from natural resources and generated even in places without grid connectivity, harnessing RE could provide a way to increase energy security and combat climate change – all while promoting India’s development. The government has implemented a very strong framework and focus on renewable energy through the NAPCC (National Action Plan on Climate Change), which aims to drive sustainable growth while addressing India’s energy security challenges. The NAPCC plans to add 72 GW of renewable energy by 2017.
Fortunately, India is blessed with an abundant supply of wind, solar, hydro and biomass resources with a known capacity of over 700+ GW. To harness this potential, the Indian government has created policies and incentives to accelerate the deployment of renewable energy projects by Independent Power Producers (IPPs) and to attract much needed capital to execute the projects. These are reflected in the various National Missions such as the Jawaharlal Nehru National Solar Mission (JNNSM), whose target is 20 GW of solar power by 2022. Through this Mission and others, the government has made India the fourth largest base for renewable energy (RE) projects in the world.
The future for RE is promising. India has a base of about 18 GW of RE, constituting approximately 10.5% of the power generated in the country. As costs continue to decrease, we can expect to see this number grow by 15-20% over the next few years.
And Solar Energy, by far the most abundant source of RE, is increasingly affordable: costs have dropped significantly (75% over the last three years) and the adoption of solar as a replacement for diesel displacement is beginning to accelerate.
The Way Forward
RE sources are free, non-polluting, and can help us meet our exponentially growing demands for energy. But we’re only getting started. To further accelerate the deployment of RE, continued improvement in upfront costs is required – this can be achieved through improvements in scale, an increase in the availability of a local market, and advancements in technology, efficiency and manufacturing.
We have a vibrant local market – especially in rural areas – for RE, thanks to availability in financing and to the decentralisation of RE production and distribution. The need and aspirations of these various energy users is, in turn, driving large-scale investments in technology improvements and manufacturing effectiveness with an aim to continually reduce the cost of electricity (LCOE) from RE sources. As availability of skilled RE resources continues to improve, India is poised to become a global hub for the manufacturing of energy equipment
With over Rs. 13,000 million being spent in the 12th five-year plan to accelerate the deployment and sustainability of RE, there’s nothing to stop India from harnessing its clean energy potential.
About the author
Zhooben Bhiwandiwala began his career with Mahindra in 1985. He has dedicated a remarkable 26 years to the Mahindra Group, acquiring wide cross-functional experience across several sectors and playing an active part in finance, legal, HR, marketing, strategy, and other commercial functions.
Zhooben currently manages Mahindra Partners, a diversified division that oversees new businesses within the Group. Before taking up his role with Mahindra Partners, Zhooben served as Senior Vice President of Corporate Affairs at Mahindra & Mahindra.
The views expressed above are those of the author, and not necessarily representative of the views of the Mahindra Group.