Expert Speak Terra Nova
Published on Sep 26, 2022 Updated 23 Days ago
For India to achieve net-zero emissions by 2070, coal power must be phased out entirely, and renewable capacity needs to grow.
Power Sector: Stumbling block in India’s net-zero journey

Five commitments made at COP26

PM Modi, on 1 November 2021, presented India’s five-point agenda famously termed   ‘Panchamrit’ at the 26th session of the Conference of the Parties (COP26), to the United Nations Framework Convention on Climate Change (UNFCCC) held in Glasgow. These commitments are concrete steps which India needs to take to achieve net zero. These include:
  • Bringing its non-fossil energy capacity to 500 Gigawatts (GW) by 2030.
  • Bringing its economy's carbon intensity down to 45 percent by 2030 from the 2005 level.
  • Fulfilling 50 percent of its energy requirement through renewable energy by 2030.
  • Reducing 1 billion tonnes of carbon emissions of its projected emissions by 2030.
  • Achieving net-zero emissions by 2070.
Some of the above were in line with what India committed at COP21 held in Paris in December 2015. Over the past six to seven years, India has consciously enhanced its Renewable Energy (RE) capacity. Since 2015, India’s combined wind and solar generation have grown 2.5 times. Today, India stands in the fourth position in the world in terms of installed RE capacity and wind power capacity, and fifth in solar power capacity

The commitment to achieve 500 GW of energy capacity through non-fossil sources has been modified to achieve 50 percent of cumulative electric power capacity through non-fossil fuel sources by 2030.

After realising that  India may not be able to achieve some of these ambitious targets the Union Cabinet in its meeting held on 3 August 2022 decided to modify some of them. The updated targets for the submission to UNFCC known as Nationally Determined Contribution (NDC) are mentioned below:
  • Achieving 50 percent cumulative electric power installed capacity from non-fossil fuel-based energy resources by 2030.
  • Bringing its economy's carbon intensity down to 45 percent by 2030 from the 2005 level.
  • Achieving net-zero emissions by 2070.
As can be seen from the above, two of the commitments made at COP26 have been dropped. This included fulfilling 50 percent of energy requirements through RE sources and reducing 1 billion tonnes of carbon emissions of its projected emissions by 2030. The commitment to achieve 500 GW of energy capacity through non-fossil sources has been modified to achieve 50 percent of cumulative electric power capacity through non-fossil fuel sources by 2030. To understand the reasons behind this revision, the current and projected position of the Indian power sector needs to be understood.

Indian power sector: Current and projected position

The current installed capacity of RE sources including large hydropower plants is around 161 GW as of 30.6.2022 as per the Central Electricity Authority (CEA) of India, Ministry of Power. The current capacity of non-fossil fuel sources for power generation is 168 GW, which needs to be enhanced to 500 GW as per the commitment given during COP26. The CEA worked out the optimal power generation capacity to be achieved in 2029-30 considering the intended NDC communicated to UNFCC in 2015.  The CEA in its report published in January 2020 has projected that 817 GW of total power shall be required in 2029-30. The projected capacity of RE including large hydropower plants in 2029-30 shall be around 506 GW, which would be around 62 percent of total installed capacity, while the target communicated to UNFCC was for meeting 50 percent of its energy requirement through renewable energy by 2030. There is a huge difference between the capacity of a particular power plant and the actual output since different fuel-based power sources contribute differently to power generation. Since power from solar and wind cannot be generated round the clock, the average capacity utilisation of solar and wind is relatively low as compared to thermal, nuclear and hydro plants. 

Comparison: Power generation and power plant capacity

The table shown below shows the percentage of installed power capacity and contribution towards power generation for thermal power plants and RE power sources for 2021-22. A similar comparison has been made for the projected capacity and projected power generation for 2029-30. RE sources (Solar+ Wind+ Biomass+ Small Hydro) in 2021-22 having a share of 27 percent in total installed capacity contributed only 12 percent in electricity generation, while thermal plants (Coal+ Lignite + Gas) having a capacity share of around 60 percent in the same year contributed 75 percent in electricity generation. In the CEA report for 2029-30, RE share (excluding large hydro) has been projected to 445 GW having a 55-percent share in total installed capacity, which would contribute to 32 percent in electricity generation falling short of 18 percent as communicated at COP 26. (*): Tota l Installed Capacity for 2021-22 is based on December 2021 Report of CEA If India has to fulfil 50 percent of its energy requirement through renewable energy as per its commitment, it would require a huge expansion of renewable sources. Although energy from renewables is becoming cheaper in comparison to coal- /gas-based plants, solar/wind power plants cannot generate power round the clock. Such intermittency feature of solar/wind power sources brings instability to the power grid. Large battery storage can be useful in supplying electricity when power is not being generated but the requirement for such storage is huge and economically unviable. Large hydroelectric and nuclear projects have a high initial cost. Natural gas-fired generators, which emit 50 to 60 percent less CO2 as compared to coal-based plants, can be a reliable backup for wind and solar power for providing stability to the power grid. Therefore, natural gas can be an il substitution for coal in power generation. Domestic gas being produced in India is not sufficient to meet the requirements, therefore, around 50 percent of the gas consumption is met through the import of Liquified Natural Gas (LNG). The prices of LNG in recent years have been historically high and have been further worsened due to the Russian invasion of Ukraine. These factors have resulted in a slowdown of coal phaseout globally, and more prominently in Europe. In India also, the low availability of domestic gas and the unaffordable price of LNG are the reasons behind the underutilisation of 24GW of gas-based power plants. Therefore, the pricing of LNG/natural gas must be made affordable for it to replace coal in power generation or to provide backup to intermittent wind/ solar power.

Coal power sector: The need of the hour

The coal-based power plants become the natural choice for catering to the base load and meeting India’s growing energy demand. Another reason is the sufficient availability of cheap coal in India, shorter gestation period, and lower capital cost as compared to hydro and nuclear power plants. The CEA in its projections for 2029-30 has brought down the contribution of coal power plants in an overall generation but with the addition of a new 56 GW of coal-based capacity.

Natural gas-fired generators, which emit 50 to 60 percent less CO2 as compared to coal-based plants, can be a reliable backup for wind and solar power for providing stability to the power grid.

The over-dependence on coal-based power plants has its own pitfalls as seen during the second quarter of 2022 when the coal supplies to the power plants were not sufficient to meet the peak demand generated due to the onset of summer. This happened despite India being the world’s second-largest producer and consumer of coal, producing about 773 million tonnes in 2021-22. India has been importing a part of its coal requirement for the last several years due to insufficient domestic production. In the Five Year Vision Document (2019-2024) prepared by the inter-ministerial group of GoI, the domestic production of coal has been projected to be 1,149 million tonnes in 2023-24 from 730 million tonnes in 2019. About 80 percent of the said production would be consumed by the power sector only. It is safe to assume that India’s commitments towards renewable energy have been out of place with the expansion of coal-based power. Even in 2029-30, as per CEA projections, coal will have a share of around 50 percent, while renewables to have a share of 32 percent in the electricity generation mix. Therefore, India had no option but to drop the target of achieving 50 percent of its energy requirement from renewables by 2030. The total installed power capacity in 2029-30 would be around 820 GW as per CEA. The updated target now requires keeping non-fossil fuel capacity to 50 percent i.e. 410 GW  instead of 500 GW as per the earlier target announced at COP26, thus, reducing the target by 90 GW. It gives flexibility to the Indian power sector to add renewable power capacity and/or thermal capacity as long as 50 percent capacity is maintained for non-fossil fuel sources.

Technological interventions through improvement in the efficiency and deployment of Carbon Capture & Storage (CCS) devices to reduce the CO2 from such plants will prove beneficial.

Way Forward: India’s journey towards net-zero

Although enhancing thermal capacity as compared to solar and wind is beneficial but it can derail India’s journey towards net zero by 2070. India’s coal-based thermal power sector is one of the country’s biggest emitters of carbon dioxide (CO2); it is responsible for one-third of India’s GHG emissions, and around 50 percent of India’s fuel-related CO2 emissions. As per recent estimates, India’s net-zero aspiration by 2070 will require its coal power to be entirely phased out by 2060 and its solar and wind capacity should grow more than 7,400 GW by 2070 from the existing 109 GW. The green hydrogen policy launched by GoI which envisages the annual production of 5 million tonnes of green hydrogen by 2030 will be derailed as the production rests on green energy. India will need to act fast to reduce its dependence on coal-based power plants. Technological interventions through improvement in the efficiency and deployment of Carbon Capture & Storage (CCS) devices to reduce the CO2 from such plants will prove beneficial. This requires collective efforts from central and state governments, and huge investments in the creation of not only solar and wind power capacities but also energy storage capacities. The spread of wind and solar energy is highly disproportionate in India as 10 states hold almost 97 percent of total power generation, therefore the deficient states would need to improve. The financial health of state-owned distribution companies also needs to be strengthened to meet the solar/ wind target. Most importantly, India can only achieve net zero with the availability of concessional finance and affordable technology from developed countries.
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Contributor

Harish Manchanda

Harish Manchanda

Harish Kumar Manchanda was the Executive Director at Alternate Energy &amp:Sustainable Development. He has 32 years of work experience in Indian OilCorporation Ltd. Superannuated in ...

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