According to a think tank Climate Risks Horizon report, India could eliminate its reliance on thermal coal imports by 2029 by adding 50 gigawatts of renewable energy annually. This shift could result in approximately Rs. 5,61,066 crore (US$ 66 billion) in foreign exchange between 2025 and 2029, with total savings reaching at least Rs—14,70,673 crore (US$ 173 billion) from 2025 to 2034. The report highlights that India's electricity sector remains heavily dependent on coal imports, with around 20% of thermal coal (206 million tonnes) imported in FY24 at Rs. 1,78,521 crore (US$ 21 billion). Thermal coal imports have surged by 58% between 2013 and 2023, with the value of these imports increasing by 124% due to global price volatility and a weakening rupee.
India's energy sector faces physical and financial risks from its dependence on imported coal. Whether from political instability or natural disasters, disruptions in coal supply pose a threat. At the same time, volatile energy prices create financial challenges for power companies and consumers. The report also notes that India's electricity demand is set to rise due to urbanisation, industrial growth, and the increased adoption of electric technologies. Per capita electricity consumption has risen from 957 kilowatt-hours (kWh) in 2013 to 1,331 kWh in 2022, with climate-related heatwaves further driving demand. The government has set a target to achieve 500 gigawatts of non-fossil fuel energy capacity to address these challenges by 2030. It plans to add 50 gigawatts of renewable energy annually until 2027-28. With 151 gigawatts of solar and wind power already in place and additional hydro and biogas capacity, the country is on track to meet its renewable energy targets.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.