Edited Excerpts:
India seems well placed to meet its 2030 capacity goals of 500 GW of non-fossil fuel sources. Could you give us an overview of how India’s energy landscape will look like in 2030?
When Prime Minister gave this target of 500 GW of non-fossil fuel by 2030, many of us thought that it is an audacious and impossible target. But currently we have reached around 308 GW of non-fossil installation. Last year we added around 56 GW, and this year we are looking at adding similar capacities. Given the run-rate we have achieved in installation, we are on track to achieve the 500GW target.
We are not only looking at deployment of Renewable Energy (RE), but also the supporting infrastructure, such as the battery storage systems and the transmission system. Both these are absolutely critical for growth of the RE sector.
So, by 2030 we will also see a larger deployment base. With our green energy corridor schemes we also expect greater participation and involvement of State governments in evacuation of power infrastructure through upgraded transmission lines. By 2030 our domestic manufacturing capabilities, especially in the solar value chain, ingot and wafer manufacturing will go up substantially.
How is the experience going to be for a commercial or household consumer in 2030?
We foresee roof top solar that has taken off through PM Surya Ghar: Muft Bijli Yojana to become more universal in nature. States which are giving huge subsidy to poorer households will encourage roof top solarisation, along with battery storage systems. So that in the long run they can get out of the subsidy provisions. There is a strong possibility that agri-feeders will get solarised in a much larger manner by 2030.
So, States going forward will play a very big role in the run-up to 2030 and beyond?
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States realise they will be able to eliminate or minimise agriculture or electricity related subsidy disbursement at the State-level by adopting RE in a larger manner. States and data centres are looking at adopting RE with round-the-clock power available with help of battery systems.
You mentioned that Battery Energy Storage Systems (BESS) have become critical for grid reliability and round-the-clock power availability. What is our long-term strategy to overcome transmission and grid constraints?
The latest green energy corridor scheme will help the State governments in evacuating power from RE zones to their load centers. This will improve the transmission infrastructure within the States. Inter-State Transmission System (ISTS) planning and implementation is already on which is likely to be ready in the next one and half years. This will support the 2030 target of 500GW.
Over and above that the Central Electricity Authority (CEA) has already started planning for additional 400GW of RE that is required by 2035-36. Out of this, 250GW will come from ISTS, while the rest from intra-state network.
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The domestic battery manufacturing ecosystem has seen interest from big players. However, there are concerns around transfer of technology. How do we ensure long-term viability of domestic manufacturing ecosystem and allay any fears of Indian manufacturers and investors?
Currently, battery energy and storage systems manufacturing and exports are confined to certain geographies, but technologies are not confined to particular geographies. Whether it is Europe, South Korea or Japan, you have technologies available, just that taking them to scale and achieving economy of scale is something that has not been tried out by other countries. India is well-poised to take it to scale.
Ministry of Heavy Industry’s PLI scheme has made a good beginning. Irrespective of the PLIs, some of the leaders in the space have taken to battery cell manufacturing which will support indigenization and technology transfer. Going forward, I expect huge activity in the battery manufacturing space.
The MNRE has projected an estimated $220 Billion in investable clean energy opportunities across the value chain by 2030. Historically, transportation and RE management have attracted bulk of investments (85% of the Climate tech capital pool). Are there plans in place to move capital to other parts of the clean-tech energy ecosystem, such as bio-energy solutions, among others?
There is a plan to support that part of the ecosystem. For instance, recently, the Ministry of Petroleum and Natural Gas (MoPNG) came up with the GOBARdhan (Galvanizing Organic Bio-Agro Resources Dhan) scheme where they are supporting Compressed Bio Gas (CBG) production at industrial scale. They are assuring an off-take price and capex subsidy to promote CBG production which is one of the components of Bio Energy.
Similarly, in the green hydrogen space we are trying to promote hydrogen and their derivative production through domestic market creation and encouraging exports.
As part of the domestic market creation effort we did a tender for green ammonia for fertilizer plants. This will ensure an off-take of 670,000 tonnes per annum. Similarly, we are looking at ways green methanol could be used in the shipping industry. Bio-mass based hydrogen generation is another area where we are working with Biotechnology Industry Research Assistance Council (BIRAC).
As we move towards the 500GW target by 2030, how do we ensure that circularity-related issues become part of business strategy and practice, without impacting competitiveness of Indian products and services?
We know that from batteries, solar modules, wind turbines a large number of components could be retrieved and with little bit of processing they could be re-used. Circularity is something this Ministry is working on in coordination with Ministry of Environment, Forest and Climate Change (MoEFCC).
As part of the e-waste rules, the mandate for recycling has already been provided. We are working on developing guidelines which will be sector-specific. The process for recycling is expected to gather pace after 2035.
Recently, at the New York Climate Week you made a pitch for foreign investment in the RE sector. In fact, India’s RE sector has already attracted $23B of foreign capital between 2000 and 2025. What is your expectation for the next phase of sector’s growth? Are there any specific areas where foreign investors are showing interest?
RE has been relatively more assured sector for foreign direct investors due to the typical nature of our Power Purchase Agreements (PPAs) where we lock in the power generation with the buyer for twenty-five year period. Those PPAs and the policy certainty have helped provide the confidence, ensuring that our RE journey keeps momentum and continues to grow. Foreign investors have seen the growth momentum that has taken place.
Going forward, the (green power) requirement from data centres is going to grow. A lot of commercial and industrial users are looking at accessing green power to decarbonise and deal with measures like EU’s Carbon Border Adjustment Mechanism (CBAM). The mandate for green fuel in shipping and aviation is likely to continue the growth of the sector.
Until now we have seen the domestic market has been able to generate 85% plus of the financing requirement for RE expansion. We think that should continue, but the exposure of FDI should increase because India has provided enough policy certainty and growth momentum. We expect some long-term patient capital to come to India, especially the pension funds. Currently, exposure of Canada-based pension funds is high. At the New York Climate Week we made a pitch to the US-based pension funds. They have agreed to send a team to India to have an interface with our RE industry. Hopefully, going forward we are going to have pension funds of other countries coming in to support our RE sector.
