India's Renewable Energy Industry
India ranks as the world's third-largest energy consumer and holds prominent positions globally in renewable energy infrastructure. According to the REN21 Renewables 2023 Global Status Report, India stands fourth in both wind and solar power capacity. The country has set an ambitious target of achieving 500 GW of non-fossil fuel-based energy by 2030, marking the largest renewable energy expansion plan globally under the Panchamrit framework.
Over the past 8.5 years, India's installed non-fossil fuel capacity has surged by 396% to over 199.85 GW, representing about 45.1% of the nation's total capacity as of April 2024. In 2022, India witnessed significant year-on-year growth in renewable energy additions at 9.83%. Solar energy capacity has grown exponentially, reaching 82.63 GW as of April 2024, with a solar potential estimated at 748 GWp by the National Institute of Solar Energy (NISE).
Looking ahead, India plans to issue tenders for 50 GW of wind, solar, and hybrid projects in the fiscal year 2023-24, aligned with its commitment to achieve 500 GW of renewable energy capacity by 2030. The installed renewable energy capacity has been steadily increasing, rising from 94.4 GW in 2021 to 119.1 GW by the end of 2023.
In alignment with the goals of the Paris Agreement, India aims to generate 50% of its total electricity from non-fossil fuel sources by 2030, a target also set by the Central Electricity Authority. India has surpassed its initial target of 175 GW by 2022 for renewable energy, by showcasing a strong commitment to sustainable energy sources.
Solar and wind power, along with run-of-the-river hydroelectricity, are considered environmentally friendly and cost-effective sources of power, reducing reliance on polluting coal-fired power. India's leadership in renewable energy is further highlighted by the development of large solar parks, some of which are among the largest globally.
India's renewable energy capacity, including large hydro projects, has expanded by around 128% since 2014. The policy environment encourages foreign investment, allowing up to 100% foreign direct investment (FDI) under the automatic route for renewable energy projects, aligning with The Electricity Act 2003.
The significant growth in solar and wind power capacity underscores India's dedication to sustainable energy development, solidifying its role as a key influencer in shaping a greener global energy landscape. Initiatives like the International Solar Alliance (ISA) demonstrate India's proactive stance and leadership in renewable energy innovation and collaboration on a global scale.
Hydroelectric Power
India ranks fifth globally for its installed hydroelectric power capacity. As of March 31, 2020, India had an installed utility-scale hydroelectric capacity of 45,699 MW, which accounts for 12.35% of its total utility power generation capacity. Additionally, there are smaller hydroelectric units totalling 4,380 MW (1.3% of total capacity). Small hydropower, up to 25 MW, falls under the Ministry of New and Renewable Energy (MNRE), while larger projects fall under the Ministry of Power. India also has significant potential for pumped hydroelectric energy storage, which can economically convert non-dispatchable renewable energy into base/peak load power.
Solar Power
India has high solar insolation and a dense population, making it ideal for solar power utilisation. The Jawaharlal Nehru National Solar Mission, launched in 2010, aimed for 20 GW grid capacity by 2022 (later increased to 100 GW by 2022). India's solar power industry has been growing rapidly, with initiatives like the International Solar Alliance and Solar Park Scheme. Solar power in India has become cost-competitive, with large-scale projects in the Thar Desert and innovations like the world's first 100% solar-powered airport in Cochin.
Nuclear Power
India has 10 nuclear reactors under construction and 23 operational reactors across 7 plants, contributing 3.11% to the total power generation. Nuclear power is a significant component of India's electricity mix.
Biogas Plant
Biomass and biogas play crucial roles in India's renewable energy sector. India's agricultural potential provides biomass for energy needs, estimated at 16,000 MW from biomass and 3,500 MW from bagasse cogeneration. The country also aims to produce significant quantities of biogas/bio-CNG, utilising organic waste for energy production.
India generates large amounts of municipal solid waste and sewage, providing ample potential for waste-to-energy solutions. Anaerobic digestion and biogas technologies are well-established, though there remains substantial untapped potential for energy recovery from waste.
Biofuels
India is working towards energy self-sufficiency and carbon neutrality through biofuels like ethanol and biodiesel. The government encourages blending ethanol with petrol and supports advanced biofuel production from biomass.
Wind Power
India is among the top countries in installed wind power capacity. The wind power sector has grown significantly, with installations mainly in states like Tamil Nadu, Maharashtra, and Gujarat. India aims to generate 60,000 MW of electricity from wind power by 2022 and has introduced policies to promote wind-solar hybrid projects.
India's renewable energy sector boasts a robust installed capacity of over 191.67 GW, including large hydropower, as of April 2024. This impressive capacity breakdown includes:
Wind Power: 46.16 GW
Solar Power: 82.63 GW
Biomass/Co-generation: 10.35 GW
Small Hydro Power: 5 GW
Waste to Energy: 0.59 GW
Large Hydro: 46.92 GW
India's ambitious sustainability goals are reflected in its commitment to reduce carbon intensity by over 45% by the end of the decade, achieve 50% of cumulative electric power installed from renewables by 2030, and ultimately attain net-zero carbon emissions by 2070. To support these objectives, India aims to reach an impressive 500 GW of renewable energy installed capacity by 2030. This forward-thinking strategy underscores India's leadership in renewable energy adoption and environmental stewardship.
India is targeting to produce 5 million tonnes of green hydrogen by 2030, supported by a robust 125 GW of renewable energy capacity. This ambitious initiative reflects India's commitment to advancing sustainable energy solutions.
In parallel, India has approved 50 solar parks with a combined capacity of 37.49 GW. The wind energy sector is also gearing up, with plans to achieve a 30 GW offshore capacity by 2030, with potential sites already identified.
Furthermore, India has identified specific activities within the renewable energy sector that will be eligible for trading carbon credits under bilateral or cooperative approaches, as stipulated by the National Designated Authority for the Implementation of the Paris Agreement (NDAIAPA). These activities include:
Renewable energy with storage (only stored component)
Solar thermal power
Offshore wind energy
Green hydrogen production
Tidal energy, Ocean Thermal Energy, Ocean Salt Gradient Energy, Ocean Wave Energy, and Ocean Current Energy
High Voltage Direct Current Transmission in conjunction with renewable energy projects
Production of green ammonia
This strategic focus on carbon credit trading underscores India's holistic approach to promoting environmentally friendly renewable energy technologies and practices.
Green Growth is identified as a key focus within the SAPTARISHI framework, reflecting one of seven strategic priorities.
The Union Budget 2023 allocates $2.4 billion for the National Hydrogen Mission to produce 5 million metric tonnes (MMT) of green hydrogen by 2030, with an additional $36 million investment included.
Viability Gap Funding supports the development of 4 gigawatt-hours (GWh) of Battery Energy Storage Systems.
Pumped Storage Projects receive a push with a detailed framework set to be formulated.
Central Sector Support of $1.02 billion (2.5 billion Indian Rupees) is allocated for Inter-State Transmission System (ISTS) infrastructure to integrate 13 gigawatts (GW) of renewable energy from Ladakh.
The Union Cabinet chaired by Prime Minister Shri Narendra Modi has approved the implementation of the Production-Linked Incentive (PLI) Scheme aimed at bolstering India's manufacturing capabilities and exports in high-efficiency solar PV modules, as part of the Aatmanirbhar Bharat initiative.
Key details of the scheme include:
Tranche 1: INR 4,500 crore ($550 million)
Tranche 2: INR 19,500 crore ($2.37 billion)
The second phase, launched on September 21, 2022, targets the development of 65 GW of annual manufacturing capacity for high-efficiency solar PV modules.
Outlay: INR 19,744 crore ($2.4 billion)
Aims to achieve an annual production of 5 million metric tonnes (MMT) of green hydrogen or ammonia by 2030.
Investors can submit bids until September 7, 2023, to avail incentives under the mission.
The PLI Scheme focuses on:
Direct employment opportunities for approximately 30,000 individuals and indirect employment for about 120,000 people.
Import substitution is valued at around INR 17,500 crore annually.
Encouraging research and development to enhance the efficiency of solar PV modules.
This initiative is expected to significantly boost India's manufacturing capabilities, promote green technologies, and stimulate employment and economic growth in the renewable energy sector.
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