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Seeing India’s energy transition through its states

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Context

  • In the upcoming G20 forum, India intends to propose a diversified approach to energy pathways that considers the distinct contexts and development trajectories of countries.
  • India’s own domestic energy transition will be determined by multiple pathways of Indian states.
  • The effective transition will require bridging the gap between national ambitions and State-level implementations because states are critical actors in India’s energy transition.

Renewable Energy and Energy Transition

  • Renewable energy is energy derived from natural sources that are replenished at a higher rate than they are consumed. Sunlight and wind, for example, are such sources that are constantly being replenished.
  • Energy transition refers to the global energy sector’s shift from fossil-based systems of energy production and consumption — including oil, natural gas and coal — to renewable energy sources like wind and solar, as well as lithium-ion batteries.

India’s Target

  • Reduce the overall carbon intensity: India aims to reduce the overall carbon intensity and achieve 50 per cent of power from non-fossil fuel sources by 2030, which is currently at 43 per cent.
  • Clean Energy: India has made a commitment to clean energy with ambitious targets like 500GW of non-fossil, including 450 GW Renewable Energy (RE) capacity addition and 43% RE purchase obligation by 2030.
  • Net Zero Target: India has set itself an ambitious long-term goal of reaching net zero emissions by 2070.

India’s Policy Framework in the Direction of Energy Transition

  • India’s targets are supported through complementary policy and legislative mandates(Energy Conservation (Amendment) Act 2022), missions (National Green Hydrogen Mission), fiscal incentives (PLIs) and market mechanisms (upcoming national carbon market).
  • The Energy Conservation Amendment Act 2022
    • It mandates the use of non-fossil fuel sources including green hydrogen, green ammonia, biomass and ethanol for energy and feedstock in industries.
    • It also gives the power to the Central Government to establish carbon markets.
  • In 2022, India updated its Nationally Determined Contributions (INDC)under the Paris Agreement to reflect its aim of achieving 50% cumulative electric power installed capacity from non-fossil fuel-based energy sources by 2030.
  • India aims to produce five million tonnes of green hydrogen by 2030.

India’s Progress in Energy Transition

  • Solar, wind, and other RE sources are already replacing the historic share of coal and gas in the power generation mix.
  • The share of fossil fuels in the installed capacity has reduced from 67% in 2017 to 57% in 2023.
  • As of Feb 2023, RE Sources, including large hydropower, have a combined installed capacity of 178.9 GW.
  • The installed capacity for renewables is:
    • Wind Power: 42.6 GW
    • Solar Power: 66.7 GW
    • Biomass/Co-generation: 10.2 GW
    • Small Hydro Power: 4.94 GW
    • Waste to Energy: 0.55 GW
    • Large Hydro: 4.85 GW

Challenges to India’s Energy Transition Effort

  • Incomplete targets: While India made significant progress towards its 2022 target of 175 GW renewable energy capacity, the target remained incomplete due to various factors.
  • Disparities on state level:Only a few States, such as Gujarat, Karnataka, and Rajasthan, were able to meet their individual renewable energy targets.
  • Implementation challenges:The energy transition faces multiple challengessuch as infrastructure development, clear policy framework, availability of finance.

Significance of States in India’s Energy Transition

  • Critical to Meet National Targets
    • While the central government sets goals and provides support, the actual realisation of these targets depends on how they align with State priorities and capabilities.
    • State’s role in implementing and their active participation is essential for achieving national energy goals.
  • Laboratories of Policy Innovations
    • States in India have been instrumental in driving policy innovations, particularly in the renewable energy sector.
    • Early initiatives taken by States like Gujarat, Rajasthan, Maharashtra, and Tamil Nadu have significantly contributed to the uptake of renewable energy at the national level.
  • State’s Role to address Legacy Issues: Legacy issues in the electricity sector, such as high losses, unreliable supply and service quality, must be addressed at the State level.
  • The Diversity Across States
    • States have unique contexts, capabilities, and opportunities that need to be considered during the energy transition.
    • Recognizing and engaging with State-level diversities is essential for developing targeted and effective policies that consider regional nuances.

Importance of State-Level Framework

  • To understand plan, actions, and governance regarding the national energy transition mission.
  • To broaden the transition discourse:By applying a state-level framework, the focus of the energy transition will expand tooutcome-oriented discussions.
  • To ensure public legitimacy: It could enable participation of stakeholders in the processes and ensure public legitimacy and buy-in to complex decisions.
  • To enable more evidence-based policy choices towards a pragmatic, yet accelerated, scale and pace of energy transition.

 Way Forward

  • Systematic Identification of States’ Potential: States with the potential of contributing to RE installations and the 2030 clean energy transition goal need to be identified and leveraged systematically.
  • Planning on National Level: This process involves defining transition goals, making policies, and allocating funds to promote RE adoption.
  • State Level Engagement and Implementation: States have diverse priorities, and capabilities and therefore engagement with states is crucial for implementation of goals set by Central government.

Conclusion

  • The 2030 RE goal requires participation from all the states, with the rate and extent of the transition depending on RE resolutions adopted at the state level.
  • Different Stateshave different challenges and theyrequire tailored solutions to overcome barriers and ensure smooth implementation to realise India’s energy transition.