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Not So Fast: India May Not Meet Renewable Energy Targets After All

Government officials are optimistic about renewable energy in India, but it’s not as easy as they make it seem.

5 min read
Not So Fast: India May Not Meet Renewable Energy Targets After All
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In the village of Dhubiya, about 25 km south-east of Aligarh, in the northern Indian state of Uttar Pradesh, lives Rajwati, a 35-year-old single mother of three, who goes by only one name. A year ago, Rajwati used kerosene in lamps, the fumes from which suffocated her, and left black marks on her clothes and walls. Rajwati now has three lights and one fan powered by solar energy, for which she pays Rs 600 a month.

“I regret getting this system installed because of the expense,” said Rajwati, her face veiled by a saree. She earns between Rs 1,000 and Rs 5,000 a month, from her job as a cook at a local school and as a farm labourer, but she is reluctant to let go of the convenience the system provides. “Soon, I will own the system and I won’t have to pay for electricity,” she said.

Rajwati lives in a state where over 18.1 million households (roughly 90 million people) – equal to the population of Egypt – live without electricity, according to government data. Many people here use electricity illegally.

Solar powered lanterns being charged outdoors. (Photo: iStock)

Rajwati leased a solar home system from Simpa Networks, a company that sells these systems to under-electrified and unelectrified rural households on a pay-as-you-go model, showing that when people get reliable energy they might be willing to pay for it. The payments add up to the total cost of the system over a maximum of three years, after which electricity will be free – an additional incentive.

Companies such as Simpa, and others that build small energy grids that power a few households or a village, have the potential to reach 73 million unelectrified households in India that still use kerosene as their primary source of electricity – a polluting source of energy that produces earth-warming carbon dioxide, in addition to emitting gases such as carbon monoxide, nitrogen oxides, and particulate matter, with severe health consequences.

But such installations will not be India’s way to achieving its renewable energy targets.

Currently, small energy grids and solar home systems together produce about 1 gigawatt (GW) of electricity – a minuscule part of India’s total renewable energy targets, 175 GW by 2022, and its commitment to reduce global warming. Most of the energy capacity to meet the targets will come from rooftop solar energy and large-scale renewable energy plants largely connected to India’s national electricity grid.

Rooftop solar will be a main source of renewable energy in the coming years. (Photo: iStock)

In April 2016, Piyush Goyal, the Power and Renewable Energy Minister, reiterated that India’s solar power targets – 100 GW by 2022 – were achievable, according to this government press release, but an IndiaSpend analysis shows that this expansion is challenged by weak infrastructure and a lack of cheap financing.

To achieve its targets, India must add 130.76 GW of renewable energy over the next six years, an average of 21.7 GW per year or, three times the capacity it added in 2016.


This target is crucial for India in achieving its goal to reduce global warming – by the year 2100, the earth’s temperature could increase by an average of 1.8 degrees Celsius, in the best scenario, and four degrees Celsius, in the worst scenario, according to estimates by the Intergovernmental panel on Climate Change.

The power sector in India produces about half of all CO2 emissions in the country (805.4 million tonnes), according to the power ministry’s Draft National Electricity Plan 2016; coal is the most polluting of all power sources.

In 2015, the world, through the Paris Agreement, agreed to limit the rise of the earth’s temperature to under two degrees Celsius by the year 2100. As many as 162 countries, including India, have submitted their Intended Nationally Determined Contributions (INDC), documents which describe steps countries will take to limit global warming.

As part of its INDC, India has committed to source 40% of its electricity from non-fossil fuel sources by 2030.

In October 2016, renewable energy made up 15% of India’s installed electricity production capacity, up from 13.1% in August 2015, according to government data.

Raveena, who lives in Dhubiya village, in Uttar Pradesh, stands in front of two of the parts of the solar home system–a deep blue box that tells the family when they should pay the next instalment, and a fan that works on solar energy. (Photo Courtesy: IndiaSpend/Shreya Shah)

India’s Renewable Energy Targets: A Long Way To Go

The government’s ambitious target has created awareness about renewable energy. Even companies that do not benefit from government subsidies for renewable energy projects said the government’s push for renewable energy has made consumers more aware about its virtues.

More people now recognise that alternative sources can power energy within the household without being connected to the grid.
Piyush Mathur, chief financial officer of Simpa Energy Networks.

But India’s renewable energy targets are “highly optimistic and not realistic”, said Vibhuti Garg, a power sector expert at the International Institute for Sustainable Development, a Canada-based environmental non-profit.

The growth in renewable energy would have to keep pace with the increasing energy requirement of the population. One estimate puts the total requirement of electricity in India at 5,000 terawatt hour in 2040, a four-fold increase from 2014.


India Lacks Electricity Infrastructure To Support Growth of Renewable Energy

Infrastructure for parks such as development of access roads, land acquisition for parks, and demarcation of land areas within solar parks, is incomplete, even after bids for projects are completed, which could affect project costs and profitability, according to the Mercom Capital Group report.

Further, power from sources such as wind and solar is intermittent, and forecasting of energy levels is weak. “We still don’t know how much (electricity) capacity will be available and when,” said Garg, which makes it an unattractive venture for power distribution companies to connect to renewable sources.

For instance, “What if it rains continuously for three days?” Garg said, adding that India still does not have reserve electricity capacity that could be used in such situations.

Another challenge is whether India’s electricity grid has the capacity to take intermittent power surges that will occur because of renewable energy. The grid should also have the capacity to carry power from regions where power is generated to the regions where power is needed.

(This piece, by Shreya Shah, originally appeared in IndiaSpend. It has been edited for length. You can read the full version here.)

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