Last Updated: May 21, 2020
Last Updated: March, 2020
The Indian renewable energy sector is the fourth most attractive1 renewable energy market in the world. India is ranked fourth in wind power, fifth in solar power and fifth in renewable power installed capacity as of 2018. According to 2018 Climatescope report India ranked second among the emerging economies to lead to transition to clean energy.
Installed renewable power generation capacity has increased at a fast pace over the past few years, posting a CAGR of 17.28 per cent between FY14–19. With the increased support of government and improved economics, the sector has become attractive from investors perspective. As India looks to meet its energy demand on its own, which is expected to reach 15,820 TWh by 2040, renewable energy is set to play an important role. As a part of its Paris Agreement commitments, the Government of India has set an ambitious target of achieving 175 GW of renewable energy capacity by 2022. These include 100 GW of solar capacity addition and 60 GW of wind power capacity. Government plans to establish renewable energy capacity of 500 GW by 2030.
As of February 2020, the installed renewable energy capacity is 86.75 GW, of which solar and wind comprises 34.40 GW and 37.66 GW respectively. Biomass and small hydro power constitute 9.80 GW and 4.6 GW, respectively. Off-grid renewable power capacity has also increased. As of February 2020, generation capacities for Waste to Energy, Biomass Gasifiers stood at 139.80 MW and 9,806.31 MW, respectively.
With a potential capacity of 363 gigawatts (GW) and with policies focused on the renewable energy sector, Northern India is expected to become the hub for renewable energy in India.3
According to data released by the Department for Promotion of Industry and Internal Trade (DPIIT), FDI inflows in the Indian non-conventional energy sector between April 2000 and December 2019 stood at US$ 9.1 billion. More than US$ 42 billion has been invested in India’s renewable energy sector since 2014. New investments in clean energy in the country reached US$ 11.1 billion in 2018.
Some major investments and developments in the Indian renewable energy sector are as follows:
Some initiatives by the Government of India to boost the Indian renewable energy sector are as follows:
The Government of India is committed to increased use of clean energy sources and is already undertaking various large-scale sustainable power projects and promoting green energy heavily. In addition, renewable energy has the potential to create many employment opportunities at all levels, especially in rural areas. The Ministry of New and Renewable Energy (MNRE) has set an ambitious target to set up renewable energy capacities to the tune of 175 GW by 2022 of which about 100 GW is planned for solar, 60 for wind and other for hydro, bio among other. As of June 2018, Government of India is aiming to achieve 225 GW of renewable energy capacity by 2022, much ahead of its target of 175 GW as per the Paris Agreement. India’s renewable energy sector is expected to attract investments of up to US$ 80 billion in the next four years. About 5,000 Compressed Biogas plants will be set up across India by 2023.
It is expected that by the year 2040, around 49 per cent of the total electricity will be generated by the renewable energy, as more efficient batteries will be used to store electricity which will further cut the solar energy cost by 66 per cent as compared to the current cost.* Use of renewables in place of coal will save India Rs 54,000 crore (US$ 8.43 billion) annually5. The renewable energy will account 55 per cent of the total installed power capacity by 2030.
Note: 1- According to Renewable Energy Country Attractiveness index 2018 by EY;
2- As per data from the Economic Survey;
3- As per the Confederation of Indian Industry's (CII) report titled 'State Renewable Energy Policies: A Comparative Study' ;*According to the Bloomberg New Energy Outlook 2018; ** Data from Venture Intelligence; 4 – as per Greentech Media; 5 – Greenpeace India, Union Budget 2020-21
Note: Conversion rate used as on January 2020, Re 1 = US$ 0.01402
SPV – Solar Photovoltaic System, MWeq - Megawatt Equivalent
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
Last Updated: May 21, 2020
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