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Sansad TV: Diplomatic Dispatch- Energy Security & Energy Transition

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How India emerged as a world leader in the Energy Transition?

  • The India Energy Week in Bengaluru marks the first major event under India’s G20 Presidency.
  • India had one of the fastest rates of growth of Renewable Energy capacity in the world.
  • It had pledged in COP-21 in Paris that by 2030; 40% of its power generation capacity will be from non-fossil fuel sources.
  • It has set a target of 450 GW of Renewable Energy capacity by 2030.
  • It had achieved universal access by connecting every village and every hamlet under Deen Dayal Upadhyay Gram Jyoti Yojana Scheme and connecting every household under Saubhagya Scheme. It was the fastest and the largest expansion of access in the world.
  • India has already touched 200 GW of demand even when the effects of COVID-19 were still there.
  • India will also emerge as a leader in Green Hydrogen and Green Ammonia.

Coal contradiction:

  • The target for coal production at 1.5 billion tonnes, which was set in 2015, has been reinforced recently to be achieved by 2024.
  • Privatisation of coal mining and recent auctions have given a meaningful thrust to this.
  • Looked at the target set for renewable energy, targets for cola production convey contradictory signals.
  • The targeted coal production of 1.5 billion tonnes, even by 2030, would mean thermal generation capacity could double over the current 223 GW.
  • In that case, even with targeted RE capacity, we will not achieve our emissions intensity Paris commitment.
  • Can a global green champion announce doubling its coal production in five years?

Problems with renewable:

  • Policy Issues
  • Continuous changes in duty structure.
  • Renegotiation of PPAs.
  • Curtailment of solar power.
  • Extremely delayed payments in some states.
  • Policy flip-flops on open access and net metering.
  • Delays by state agencies and regulators.
  • Land possession difficulties.
  • Transmission roadblockseven in solar parks.
  • Our capacity for cell manufacture is 3 GW,though workable capacity is actually around 2 GW.
  • Domestically manufactured cells are more expensive and less efficient.
  • There is little upgrade in a rapidly changing world of technology.
  • 90% of cells and 80% modules are imported largely from China or Chinese companies elsewhere.
  • Wafer imports are 100%as we don’t manufacture ingots/wafers.
  • For every GW with an average cost of Rs 5,000 crore in 2019, more than half goes to China.
  • Storage constraints
  • Hydro pump storageis limited in quantity and there will be an issue of costs.
  • The other project is a solar-wind hybrid with batteries installed after a few years.
  • Neither intends to meet peak power demandor even the baseload.
  • Forecasts suggest lowering of battery costs by 50% by 2030.
  • It makes sense to wait before we go for large-scale storage.
  • Manufacturing domestically
  • At the least plan to make5 GW of ingot/wafer manufacturing capacity urgently.
  • We may require electricity supply at about Rs 3 per unit, and dedicated power plants.
  • The risk oftechnology obsolescencewould need to be factored in.
  • Policy, fiscal and financial support prescriptions should aim at creatingglobally competitive industry.
  • We need to develop batteries suitable for extreme Indian weather conditionsbut globally benchmarked.
  • This demands a mission approach,getting our best people and institutions together, properly funded and tasked to get a battery out in the next three years.
  • We must also simultaneously launch a hydrogen mission—target heavy vehicle mobility through fuel cells.
  • It may become a solution for RE storage, too.

What needs to be done now?

India needs to identify strategic opportunities for economic recovery in the short, medium, and long terms that can translate challenges posed by the pandemic into clean energy transition opportunities.

  • Opportunities in the transport sector include making public transport safe, enhancing and expanding non-motorized transport infrastructure, reducing vehicle kilometres travelled through work-from-home where possible, supporting national strategies to adopt electric vehicles in the freight and passenger segments, and making India an automotive export hub.
  • In the power sector, opportunities include improving the electricity distribution business and its operations, enabling renewables and distributed energy resources, and promoting energy resilience and local manufacturing of renewable energy and energy storage technologies.

Suggested pathways

  • Build thermal capacity as per CEA estimates and quickly. None after 2030. Retire inefficient plants. Plan for miner rehabilitation.
  • Accelerate RE after 2030 with storage. Aim for 10 GW solar and 5 GW wind annually.
  • Develop 5-10 GW ingot/wafer manufacturing capacity urgently and diversify import sources even at some extra cost.
  • Develop a battery for Indian conditions in three years; full battery manufacturing in India in five years.
  • Revisit the manner of solar generation. Prioritise decentralised and solar agriculture.
  • Plan for hydrogen economy with pilot projects and dedicated highways for long and heavy haul traffic.
  • Put a strong energy demand management system into place with much stronger energy efficiency and the conservation movement.
  • India must develop its own world-scale, competitive, manufacturing systems for photovoltaics (PVs) and battery storage.
  • India must prepare a clean energy technology strategy. Technology is the answer to the energy transition