India Checkup

India—Standing Still

The continuing rapid growth in renewable energy in India, combined with sustained reductions in coal imports and a slow down in coal development—with coal-fired “ultra-mega power projects” cancelled—is a strong indication that the low carbon transformation of India’s energy supply sector is gathering momentum.

Several recent articles in The Guardian and Financial Times seem to indicate that India is making significant decreases in its use of coal fired electricity. In 2016, new coal plant construction was down by 62%. However the effort to upgrade emissions technology in existing plants has stalled. Piyush Goyal, India’s Power Minister, told the Financial Times that India’s 132 existing coal power stations, three-quarters of which are owned by government will take some time to upgrade their facilities.

India’s Draft Electricity Plan confirms that no new coal capacity is needed after 2022, apart from the 50 GW that is already under construction and is likely to be ready by 2022. The Draft Electricity Plan further assumes that no gas fired capacity will be deployed after 2022 as the availability of natural gas is uncertain in India. Experts in the sector believe that until 2022, any private investment in fossil fuel energy production is unlikely. Near about 60,000 MW of under-construction projects face an uncertain future.  The Business Standard reported that about 25,000 MW of thermal power plants, belonging to private players, are on sale but there are no takers.  (Ref: http://www.business-standard.com/article/economy-policy/25-000-mw-power-projects-on-sale-but-buyers-missing-as-demand-remains-dull-117060400478_1.html)

Despite this good news Climate Tracker points out the continued tension between the development needs of a growing population and commitments to increased usage of renewable energy. Although India’s 2022 renewable energy target represents a rapid increase in renewable energy generation, this is not enough to keep up with growth in electricity demand. Between 2014 and 2030 under current policies, the estimate average annual growth rate for solar and wind power generation is around 3%—about half the growth rate of overall electricity production.

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Climate Tracker Analysis: http://climateactiontracker.org/countries/india.html
Financial Times article: https://www.ft.com/content/18268438-2e3e-11e7-9555-23ef563ecf9a
Guardian Article: https://www.theguardian.com/environment/2017/mar/22/coal-power-plants-green-energy-china-india