In early April 2023, India announced plans to issue tenders for 250 GW of new renewable capacity by March 2028, as it looks to cut its emissions by 45% from 2005 levels. However, coal remains the dominant source of electricity. The share of clean power generation needs to more than double for the nation to meet its climate goals. Additionally, to meet Prime Minister Narendra Modi’s targeted energy self-sufficiency by 2047 — the centenary year of India’s independence, the nation will require domestic capacity increases for manufacturing green technologies, such as solar modules, battery storage and electrolyzers for making renewable hydrogen. The second part of our focus on India highlights the nation’s ambitious plans. L. Michael Buchsbaum reports.

Embarrassing diplomatic spot

Taking over the rotating presidency of the G20 group of major economies in 2023 is an important opportunity for India to strengthen international cooperation on energy security and energy transition. It’s also a great chance to show leadership on climate action.

But facing worsening deadly heatwaves and spiking energy demand, coal’s share of power generation across the country is continuing to grow, rising above 73%, while the share of renewable electricity remains at just around 12%.

However, despite India historically emitting far less than other more developed nations, as it grows, ’it is increasingly becoming the author of its own misfortunes’, writes David Fickling in a recent commentary published by Bloomberg.

Already by some estimates the world’s biggest country by population, India’s also set to become the biggest source of demand growth for fossil fuels over the coming decade.

Though rich countries have cut their emissions by about 16% since 2007, India’s billowing greenhouse gas pollution is now poised to exceed those from the European Union.

As things stand now, by the end of this decade, they’ll account for more pollution than Europe and Japan put together.

While 15.77 gigawatts of wind and solar were installed last year, that figure is less than half what’s needed.

And despite renewables having fallen far below the costs of conventional alternatives, India’s new coal build out is increasing.

’The government’s increasing protectionism of coal at the expense of cleaner energy is condemning citizens to live under hotter and hotter temperatures… Whatever happened in the past, the country’s leaders can’t absolve themselves of responsibility for the consequences of their own actions over the coming decade’, writes Fickling.

Making a clean break

But it does seem as though New Delhi has become serious about taking aggressive measures.

To meet its international climate goals and commitments, the share of clean sources in India’s power generation capacity needs to surge to 90% by 2047 — more than double where it is now, acknowledged federal Power Secretary Alok Kumar  at a recent G20 meeting.

Days later, in early April, Indian Power Minister R.K. Singh announced the government would begin accepting bids for 50 GW of new renewable energy capacity additions per year starting from fiscal year 2023-24 to fiscal year 2027-28.

The Ministry of New and Renewable Energy (MNRE) finalized the plan at a recent meeting, determining it is in line with India’s announced target of 500 GW of installed electricity capacity from non-fossil fuel (renewable energy and nuclear) sources by 2030.

But the nation has a long way to go to get there.

As of the end of February 2023, India had installed 168.96 GW of cumulative renewable energy capacity, including 64.38 GW of solar power, 51.79 GW of hydro, 42.02 GW of wind, and 10.77 GW of bio power, confirmed Minister Singh.

Additionally, almost 83 GW of green energy capacity is under various stages of implementation and some 41 GW is in the tendering stage.

At this point, according to JMK Research, India is set to install 16.8 GW of new solar capacity in 2023, including about 14 GW of utility-scale solar projects plus 2.8 GW of rooftop solar projects. Though higher than last year, these figures need to ramp considerably.

Manufacturing self-sufficiency

To reach their ambitious climate goals as well as net zero by 2070, government leadership has seemingly concluded that the nation must become the master of its own fate by sharply increasing domestic capacities to manufacture solar modules, battery storage systems and electrolyzers for making renewable hydrogen.

This strategy is completely in line with Prime Minister Narendra Modi’s vision of energy self-sufficiency by 2047 — the centenary year of India’s independence.

To get there, the government is offering incentives, including grants for domestic production of solar modules and other green components either for installation at home or for export.

As production ramps, the government hopes to emerge as an alternative manufacturing destination, threatening China’s dominance.

‘The challenge is huge and if we don’t succeed in promoting local manufacturing, India’s energy transition will be very, very, difficult’, Kumar said. ’There is no alternative.’

On track to being number two in solar by 2026

Currently, ’we are on course to have roughly 100 gigawatts of annual solar modules production capacity by 2026’, boasted Bhupinder Singh Bhalla, India’s renewable energy secretary, at the G20.

A new joint report from the Institute for Energy Economics and Financial Analysis (IEEFA) and JMK Research & Analytics concurs, finding that India’s sector is on track to produce above 110 GW of solar module capacity over the next three years.

If it can achieve this, it will become solar self-sufficient as well as develop itself into the second-largest PV manufacturing country after China.

’The favorable policy environment created by the Indian government is helping the PV manufacturing industry to grow rapidly, which is evident in the frequent announcements of expansions or new investments in the sector’, says the report’s co-author Vibhuti Garg, Director, South Asia, IEEFA.

With cumulative module manufacturing nameplate capacity more than doubling from 18 GW in March 2022 to 38 GW in March 2023, the next course of action, Garg says, should be to challenge and compete for dominance in both quality and scale in the global PV module market.

But this will require policy stability ’to sustain investor confidence in the market’, she adds.

One of the most successful catalysts spurring the growth of the entire PV manufacturing chain has been the government’s implementation of a production-linked incentive (PLI) scheme, says the report’s co-author Jyoti Gulia, founder, JMK Research.

The results of both recent tranches of the PLI scheme show that there will be an increase of 51.6 GW of module capacity and at least 27.4 GW of integrated ‘polysilicon-to-module’ capacity in India over the next three to four years.

The government is also taking steps to increase demand for locally made solar PV modules by introducing a domestic content requirement (DCR) in several support schemes.

The views and opinions in this article do not necessarily reflect those of the Heinrich-Böll-Stiftung European Union.