India achieves a milestone in renewable energy capacity amid the ongoing climate change discussion at the World Economic Forum – EQ
In Short : India reaches a milestone in renewable energy capacity amid the ongoing climate change discussion at the World Economic Forum. This achievement underscores the country’s commitment to sustainable energy and contributes to global efforts to address climate challenges.
In Detail : With the World Economic Forum (WEF) 2024 beginning in Davos and focusing on discussions about climate change, India has announced a remarkable achievement in the renewable energy sector, attracting a total investment of Rs 16.93 lakh crore in the last 10 years. Domestic and foreign investors have shown an appreciable enthusiasm to drive this sector towards achieving the goal of carbon dioxide (CO2) emission reduction through the generation of green energy and creating a pollution-free business environment. India has set a climate goal to achieve carbon neutrality by 2070.
Leaders from all across the world have gathered in Davos, Switzerland, to attend the five-day global meet entailing 500 sessions with 3,000 paying members and selected participants. Attendees of this meeting include investors, business leaders, economists, politicians, celebrities, and journalists. The WEF, an international non-governmental organization (NGO) for public and private sector collaboration, offers immense opportunities for bilateral and multilateral business engagements for future growth. Global leaders congregated to deliberate on increasing conflicts, artificial intelligence (AI), climate change, deepfakes, misinformation among leaders, etc.
India has been much ahead in the list of targeted carbon emission reduction with an extensive focus on renewable energy generation. The power sector is one of the largest fossil fuel guzzlers and, hence, emitters. Announcing the new Electricity (Amendment) Rules 2024, Union Minster for Power and New and Renewable Energy, R K Singh, said that India has received a whopping Rs 16.93 lakh crore investment in power and renewable energy in the last 10 years, and another Rs 17.05 lakh crore is in the pipeline.
These investments have enabled India to set up 80 gigawatts (GW) of thermal power generation capacity, expected to come on stream by 2030. Another approximately 99 GW of renewable energy capacity is in the various stages of construction. The growth in the power sector with adequate infrastructure for transmission and distribution will enable generating companies to penetrate consumer segments such as industrial units and households.
“Of the Rs 16.93 lakh crore investment attracted so far in the power, new and renewable sector, over two-thirds or 66 percent will go into the sectors of generation, distribution, and transmission, while the remaining amount of Rs 5.73 lakh crore is proposed to be dedicated towards renewable energy sector. An investment of Rs 17.05 lakh crore is currently in the pipeline across power and renewable energy sectors,” the Minister said.
These investments would take up India’s power generation capacity to over 800GW by 2030 from the existing about 428GW at present. India has prepared plans to bid out 50GW of renewable energy projects every year to boost green energy generation. This will be an enormous growth for the green energy sector in India.
Genesis of new rules
India has amended the power sector rules to facilitate the smooth transition of generation, distribution, and transmission benefitting both investors and consumers. The government has introduced new rules to enhance the ease of doing business, particularly for industries like Green Hydrogen manufacturers. The amendments also aim to expedite energy transmission and ensure energy security by accelerating the establishment of energy storage capacity.
With the new rules in effect, consumers with a specified quantum of load and Energy Storage System (ESS) are now allowed to establish, operate, and maintain dedicated transmission lines without the need for a license. The provision opens the door for a new category of bulk consumers in the country, providing them the more affordable electricity and enhancing grid reliability.
According to the new rule, a generating company, a person setting up a captive generating plant, an ESS, or a consumer with a load of not less than 25MW for the Inter-State Transmission System and 10MW for the Intra-State Transmission System is not required to obtain a license for establishing, operating, or maintaining a dedicated transmission line to connect to the grid. If the company, person, or consumer complies with the regulations, technical standards, guidelines, and procedures issued under the provisions, the proposer may proceed directly without obtaining a license from the government.
FDI in the renewable energy sector
Encouraged by investor-friendly government regulations, India’s renewable energy sector has attracted a Foreign Direct Investment (FDI) worth US$6.1 billion between April 2020 and September 2023. India allows 100 percent investment in the renewable energy sector through the automatic route. The Indian government has introduced various measures, including the establishment of a Project Development Cell, the creation of Ultra Mega Renewable Energy Parks, and the implementation of new transmission lines under the Green Energy Corridor Scheme. The objective of these measures is to foster growth in the renewable energy sector.
The Minister emphasized complementary key government schemes, along with infrastructure advancements such as Pradhan Mantri Kisan Urja Suraksha Evam Utthaan Mahabhiyan (PM-KUSUM), Solar Rooftop Phase-II, and the 1200 MW CPSU Scheme Phase II. Additionally, the National Green Hydrogen Mission aims to position India as a global leader in the production and export of green hydrogen.
The government has further strengthened these initiatives with the introduction of the Green Energy Open Access Rules 2022, the launch of the Green Term Ahead Market (GTAM), and the issuance of Standard Bidding Guidelines for solar PV and wind projects. Notably, the government has waived Inter-State Transmission System (ISTS) charges for solar and wind power projects commissioned by June 30, 2025, and established standards for solar photovoltaic systems and devices.
IEA vouching for rapid global growth
Meanwhile, the Paris-based autonomous intergovernmental organization, the International Energy Agency (IEA), revealed that the global renewable energy capacity increased by 50 percent in 2023, over the previous year. According to IEA, global renewable capacity reached almost 510GW in 2023, with solar photovoltaics (PV) accounting for three-quarters of additions worldwide. The increase was the fastest growth rate in the past two decades and the 22nd year in a row that renewable capacity additions set a new record.
However, to win the climate battle against rising temperatures, there is an urgent need to increase the renewable capacity further, the IEA said. The increase in capacity was driven by China, the world’s biggest emitter of greenhouse gases, but the country has become a ‘renewables powerhouse’. The world’s second-largest economy commissioned as much solar PV last year as the entire world did in 2022, while the country’s wind power additions rose by 66 percent year-on-year.
