Amid $30bn investment opportunities in renewable energy, don’t wish away coal: Economic Survey
The survey said while there has been tremendous increase in the renewable energy capacity, fossil fuels, especially coal, would continue to remain an important source of energy.
NEW DELHI: India’s renewable energy sector will offer investment opportunity of $30 billion every year for the next decade and beyond, but the country cannot wish away conventional sources of energy like oil and coal as demand is forecast to gallop in the next few decades, the Economic Survey said.
It said India had a huge appetite for energy, which is the mainstay of economic development, and the government’s priority is to ensure access to sustainable and clean energy.
“India, therefore, needs to quadruple its per-capita energy consumption to meet the rising aspirations of its citizens. This will also enable India to achieve the human development status of an upper-middleincome country,” it said.
The survey estimated additional investment requirement in renewable plants for up to 2022 at about $80 billion at today’s prices and an investment of around $250 billion for the period 2023-30.
“Thus, on an annualised basis, investment opportunity for over $30 billion per year is expected to come up for the next decade and beyond,” it said.
The share of renewables in total electricity generation of the country was around 10% in 2018-19 compared to around 6% in 2014-15. Globally, India stands fourth in wind power, fifth in solar power and fifth in renewable power installed capacity.
The cumulative renewable power installed capacity has more than doubled to 78 GW in March 2019 from 35 GW in March 2014. In addition, around 27 GW renewable power capacity is under installation and over 38 GW under bidding to achieve an installed capacity of renewable based power of 175 GW by 2022.
The survey said while there has been tremendous increase in the renewable energy capacity, fossil fuels, especially coal, would continue to remain an important source of energy.
“Further, it may not be advisable to effect a sudden abandonment of coal-based power plants without complete utilisation of their useful lifetimes as it would lead to stranding of assets that can have further adverse impact on the banking sector. Further, considering the intermittency of renewable power supply unless sufficient technological breakthrough in energy storage happens in the near future, it is unlikely that thermal power can be easily replaced as the main source of energy for a growing economy such as India,” the survey said.
It added that there is a need for building capacity for cleaner and more efficient coal technologies, given the sustainable energy objectives of the country and the importance that coal-based power plants entail.
“A comprehensive energy policy should take into consideration the economies of both coal and renewables as they are interdependent. They are substitutes for each other as a source of energy but are complementary in keeping the flow to the grid stable as coal generation represents a stable source of power while renewable energy may be variable.”
The country also needs higher refining capacity to meet its energy needs, the survey said.
“India’s primary energy demand is expected to grow at a CAGR of 4.21% during 2017-40, much faster than any major economy in the world. There is thus a need to augment refining capacity to meet growing demand for petroleum fuels and petrochemicals, which play significant role in sustaining GDP.”
India has 23 refineries, of which 18 are in the public sector, three are in the private sector while two are joint ventures. India’s refining capacity is forecast to rise substantially.
The survey also highlighted the need for energy efficiency.
“Future policy direction should orient itself to enhanced energy efficiency programmes in different sectors of the economy as well as technological solutions to better utilise the natural resource endowments of the country for greater prosperity.”
The government has already encouraged energy efficiency programmes and the use of LED bulbs that have led to substantial savings. Energy efficiency programmes, including Perform Achieve and Trade, UJALA and Standards & Labelling Programme, resulted in total cost savings worth Rs 53,000 crore in 2017-18 and contributed in reducing 108.28 million tonnes of carbon emissions.
The overall electricity savings due to adoption of these energy efficiency measures is estimated at 7.21% of the net electricity consumption in 2017-18. Total thermal energy saved is 2.7% of the net thermal energy consumption and 2.0% of the net energy supply during the same period.
Source : economictimes
