The Bulletin of the Atomic Scientists profiles India’s pivot away from coal towards renewable, especially solar energy:
India entered the first decade of the 21st-century on a path of massive coal-fired power generation investment, with plans reaching over 600 gigawatts. India now exits this decade with over four-fifths of this high-emission, high-pollution investment intent now shelved, uncompetitive against zero emissions renewable energy.
According to the article, this has been accelerated by two factors: a recognition of the environmental costs of growth-by-pollution, reverse auctions to create low-cost supply backed by large amounts of foreign investments
The result? The government of India enabled $40 billion of new investment and a doubling of renewable energy capacity in just over three years, to 83 gigawatts by September 2019, with another 45 gigawatts of large scale hydro-electricity. (To give a sense of scale, the Hoover Dam generates 2 gigawatts.)
In addition to low-cost electricity, the government of India had introduced another key benefit into its auction process. Not only were the bids being offered about 20-to-30 percent below the wholesale price of electricity, they were also fixed at a flat rate for 25 years. In doing this, India created a deflationary low-cost electricity system running on zero inflation…
The article makes for good reading. It’s worth also reading this November 2019 article in the Mint newspaper for context:
Solar energy tariffs in India are among the lowest in the world, but state governments are keen to push them down further. These dangerously low tariffs are turning unsustainable for some developers, who in turn cut corners on quality. Some state power distribution companies (discoms) are also over a year late on paying their power bills.
State governments, especially in Andhra Pradesh, seem to be holding power producers to ransom, either asking them to reduce tariffs even further or risk having the plug on the contract pulled. This is rich, given that
As of July 2019, which is the latest data available from the Central Electricity Authority, state discoms owe a whopping ₹9,735.62 crore to renewable energy companies. Of this, ₹6,500 crore is due from just three states—Andhra Pradesh, Tamil Nadu and Telangana. Andhra Pradesh discoms, the worst offenders, haven’t paid their dues in over 13 months.
As long as the state is also in the business of running business, instead of merely policy making and enforcement, it will continue to be a threat to economic – and environmental – progress, throttling potentially thriving growth areas.
All of this when there is so much opportunity and head-room. The share of renewables in India’s energy mix is still low, even compared to China and the US leave alone other Western European economies running to close to 100% on renewables; electricity generation capacity is also a fraction of China’s:
