In a previous article we were commenting on how renewables Renewable energy sources are already surpassing coal as an energy source worldwide. This is very positive news that paints a different future horizon than the one we have experienced until now, setting the tone for a cleaner and more sustainable world. Renewable energy is proving its importance in countries that depend on fossil fuels to promote energy growth and development. India is one of those countries.
Current energy situation in India: the dominance of coal
India is one of the most coal-dependent countries in the world, making the energy transition a crucial challenge for its economic and environmental future. Currently, the main source of energy In India, it is coal, followed by oil and gas, which together cover more than 90% of the energy demand in the subcontinent, including Pakistan and Bangladesh.
The future of solar energy in India
Although India's dependence on coal remains high, the future is not so bleak for renewable energy. According to Bloomberg New Energy Finance, by 2020, massive photovoltaic energy is expected to be cheaper than plants that rely on imported coal. This claim is based on the electrical levelized cost (LCOE), which compares the average total cost of building and operating a power plant with the total energy it will generate over its lifetime.
Even if coal prices remain constant, the continued decline in photovoltaic costs means that the Solar energy will be cheaper than coal by 2020, according to Bloomberg. This is a big change from just ten years ago, when solar power was three times more expensive than coal-based energy.
The ambitious goal of 175 GW by 2022
The Indian government has laid out clear and ambitious plans to boost renewable energy. According to current projections, it is expected to reach 100 million tons by 2020. 175 GW of renewable energy capacity by 2022, of which 100 GW will come from solar energy. This target represents a significant jump from the 46,5 GW of renewable energy in 2015, a figure that is expected to quadruple with initiatives such as floating solar energy and offshore wind farms.
To achieve this goal, India will need to increase the pace of renewable energy installation sevenfold, from installing 3 GW per year to 20 GW. The opportunities in the sector are not only energy-related, but also employment-related, with the creation of More than 675.000 jobs in the solar sector by 2025, according to Tata Power Solar.
Projects and challenges in the solar sector
India is also moving forward in building large-scale solar plants, such as the installation in Gujarat, which with a projected capacity of 5.000 MW could become the largest solar installation in the world. This project will require an investment of 3.840 billion dollars and will generate 20.000 direct jobs during its construction.
However, not everything is a bed of roses for the sector. Import dependence The demand for solar panels remains high, with over 80% of solar cells purchased from China. Moreover, although the government has imposed tariffs and offered incentives for local production, Indian manufacturers are still struggling to meet the growing demand and required quality.
Fitch Solutions analysts warn that the Indian PV industry must focus on improving both the quality as quantity if it wants to meet the needs of the market. The government, for its part, has promoted a plan of financial and fiscal incentives, such as the Production Linked Incentive Program (PLI), to promote national manufacturing.
Renewable energy takes hold in India
Despite challenges, progress in renewable energy in India is remarkable. Total solar power capacity is expected to reach 1.5 million grow from the current 59 GW to 140 GW by 2031This projection is consistent with the country's commitments under the Paris Agreement, even exceeding the targets set for 2027.
India has managed to attract the interest of large international investors, such as Foxconn and SoftBank, which have committed more than $20.000 billion to solar projects. This influx of foreign capital, combined with the government’s plans not to build new coal plants before 2027, promises an encouraging outlook for renewable energy in the short and long term.
India’s transition to renewable energy, particularly solar, is well underway. With an ambitious target of 175 GW by 2022, the country is betting heavily on a cleaner, less coal-dependent future, consolidating its presence as a world leader in renewable energy and ensuring sustainable energy development for its 1.300 billion inhabitants.