- India stands 4th globally in Renewable Energy Installed Capacity (including Large Hydro), 4th in Wind Power capacity & 4th in Solar Power capacity (as per REN21 Renewables 2022 Global Status Report).*
- India is the 3rd largest market in the world for new solar photovoltaics (PV) capacity (as per REN21 Renewables 2022 Global Status Report). *
- India has already achieved its target of 40 per cent installed electric capacity from non-fossil fuels.
- Reasons to Invest
- India targets 50% cumulative electric power installed capacity from non-fossil fuel-based energy resources by 2030. *
- India aims to reach a non-fossil fuel energy capacity of 500 GW by 2030 *
- Solar Power tariff reduced by more than 75% using plug and play model. *
- India planning to have a capacity of 30,000 MW of Offshore wind and manufacture of high efficiency solar cells and modules of which India is going to set up 50,000 MW capacity *
- Government aims to have a total investment of INR 8 lakh cr in green hydrogen, and production could be 5 mn tons by 2030. The fuel will be used to replace 25% of 'grey' hydrogen, created using natural gas or methane, within 5 years. *
- India, US, China and Brazil are in consultation to form a 'Global Biofuels Alliance' to explore opportunities for cooperation and intensifying use of sustainable fuels, particularly in the transportation sector. *
- Adoption of clean cooktop fuels, such as use of solar cooktops will give a boost to green and clean cooking and more than 3 crore households will have access to such cooktops in the next 2-3 years. *
- Key Achievements
- Emission reduction of 28% over 2005 levels, against the target of 35% by 2030 already achieved by India. *
- NTPC Ltd is a PSU under the Ministry of Power that has been serving the country for the past 45 years. They have ambitious plans of 60 GW of RE capacity by the year 2032 and currently it has 3.2 GW of installed RE capacity and 3.6 GW of RE capacity under construction. *
- The agro-residue/ biomass earlier considered as a waste product has now begun to produce zero-carbon electricity for the citizens of the country. In turn, farmers are getting additional income by selling the stubble/ biomass for conversion into torrefied/ non-torrefied biomass pellets. *
- 56 solar parks sanctioned with a cumulative capacity of 39.8 GW in 14 states.*
- Indian Scientists have designed an electrocatalyst system for energy-efficient hydrogen production with the help of electrolysis of urea. The urea electrolysis is helpful towards urea-based waste treatment with low-cost hydrogen production. This can be utilized for energy production towards our country's benefits. *
- Recent Announcements
21st August 2023: IREDA signs MoU with Government, Revenue Target for 2023-24 set at ₹ 4,350 crores.
10th August 2023: 2.1 GW Capacity installed in Phase II of Rooftop Solar Programme: Union Minister for New & Renewable Energy and Power.
09th August 2023: Solar Projects of 10.2 GW Developed in Solar Parks: Union Minister for New & Renewable Energy and Power.
01st Aug 2023: More than one-fourth of total electricity production during year 2022-23 from non-fossil fuels: Union Minister for Power and New & Renewable Energy
01st August 2023: AIIMS Partners with IREDA for Solarization of AIIMS New Delhi Campus
- 2.1 GW Capacity installed in Phase II of Rooftop Solar Programme.*
- The Grid connected Rooftop Solar installed Capacity in Karnataka and Maharashtra as on 31.07.2023 is 410.65 MW and 1667.11 MW respectively.*
- Nearly 70.1 GW Solar Power Capacity Installed in the Country.*
- Overall energy storage capacity developed in the country as on 13.03.23 is 4745.60 MW from Hydro Pumped Storage Projects (PSPs) and 39.12 MWh from Battery Energy Storage System (BESS). *
- The current annual ethanol production capacity in the country is approximately 1037 cr litres. *
- Growth Drivers
- Central Government launches High Price Day Ahead Market and Surplus Power Portal (PUShP) to ensure greater availability of power during peak season. *
- Coal (including lignite) based capacity in the total installed capacity of the country is likely to reduce to around 38.4% by March, 2027 and to around 28.7% by March, 2032. *
- 10 indigenous Pressurized Heavy Water Reactors of 700 MW to be constructed in ‘fleet mode’ progressively by the year 2031 at a cost of INR 1,05,000 cr. *
- RBI has recognized IREDA as an Infrastructure Finance Company (IFC) which will allow them to access a wider investor base for fund mobilization and take higher exposure in Renewable Energy financing. This will increase the investors’ confidence, enhance the brand value, and generate positive outlook in the market. *
- 27,000 circuit kms. of transmission lines to be added at an investment of INR 75,000 cr by 2024-25. *
- PM launched the National Hydrogen Mission to aid the government in meeting its climate targets and making India a green hydrogen hub. This will help in meeting the target of production of 5 MT of Green hydrogen by 2030 and the related development of renewable energy capacity. *
- Feeder level solarization has been introduced under Component-C of the Scheme. As on 28.02.2023, grid-connected solar power plants of 89.45 MW capacity have been installed and 2.09 lakh agriculture pumps have been solarized under the Scheme. *
- Rajasthan Budget 2023-24: Electricity duty on solar energy reduced from 60 paise to 40 paise and 100% exemption on land tax on solar projects for 7 years.
- Rajasthan Budget 2023-24: Under Rajasthan Investment Promotion, state government will provide a 25% booster to first 3 units under sunrise category and falling under mega and ultra mega project slabs.
- Rajasthan Budget 2023-24: Proposal to set up the Bhadla-Bikaner bulk corridor for evacuation of renewable energy greater then 100 kV.
- FDI Policy
- FDI up to 100% is permitted in the renewable energy sector under the Automatic route and no prior Government approval is required. *
- The cumulative FDI equity inflow in the Non-Conventional Energy industry is USD 14.12 bn during the period April 2000 to March 2023. This constitutes almost 2.22% of the total FDI inflow received across sectors. *
- Production Linked Incentive (PLI) Scheme
The Union Cabinet chaired by the Prime Minister, Shri Narendra Modi has given its approval to introduce the Production-Linked Incentive (PLI) Scheme in High-Efficiency Solar PV Modules for Enhancing India’s Manufacturing Capabilities and Enhancing Exports – Atmanirbhar Bharat.
Financial Outlay- INR 4,500 cr
For more details on PLI Schemes, Click Here
- Sector Policy
- The national Bio-Energy programme launched in November, 2022 for the period FY 2021-2022 to FY 2025- 26 provides for Central Financial Assistance (CFA) for setting up about 1.66 lakh small Biogas plants and about 80-100 Compressed Biogas (CBG) plants. Approval has been provided for implementation of Biomass Programme under the Umbrella scheme of National Bioenergy Programme for duration of FY 2021-22 to 2025-26 (Phase-I)- Reg. *
- EESL has installed more than 1.28 cr LED Street Lights across 29 States/UTs under Street Lighting National Programme. *
- Ministry of New and Renewable Energy implements Rooftop Solar Programme Phase-II, targeting 4000 MW rooftop solar (RTS) capacity addition in residential sector. *
- Ministry of Power's policy on “Biomass Utilization for Power Generation through Co-firing in Coal based Power Plants” issued in October 2021 mandates all thermal power plants in the country to use 5 to 10% biomass along with coal for power production. *
- Ministry of New and Renewable Energy notified the 'Renewable Energy Research and Technology Development Programme' for promotion of indigenous technology development for wide spread deployment of new and renewable energy, including ocean energy, in an efficient and cost-effective manner across India. *
- The Ministry of New and Renewable Energy notified the National Wind-Solar Hybrid Policy in 2018 with an objective to provide a framework for promotion of large grid connected wind-solar PV hybrid system for efficient and optimal utilization of wind and solar resources, land and transmission infrastructure. The policy aims to encourage new technologies, methods and wayouts involving combined operation of wind and solar PV plants. The Policy seeks to promote new hybrid projects as well as hybridisation of existing wind/solar projects. *
- The Central Finance Assistance (CFA) under the Biogas based Power Generation and Thermal Application Programme (BPGTP) varies from INR 25,000 per kW to INR 40,000 per kW for power generation as per the generation capacity slab and INR 12,500 per kW to INR 20,000 per kW for thermal applications respectively. *
- Under the ‘Programme on Energy from Urban, Industrial and Agricultural Waste/Residues’ Scheme, Central Financial Assistance (CFA) for projects of different categories is given in the form of capital subsidy to the promoters and in the form of Grants-in-Aid for other activities, as given below: *
- Biogas generation: INR 1 cr per 12000 cum/day (Max. INR 10 cr/ project)
- BioCNG generation (including setting of biogas plant): INR 4 cr per 4800Kg/day (Max. INR 10 cr /project)
- Power generation based on Biogas (including setting of Biogas plant): INR 3 cr per MW (Max. INR10 cr/ project)
- Biomass Gasifier:
- INR 2,500 per kW with duel fuel engines for electrical application
- INR 15,000 per kW with 100% gas engines for electrical application
- INR 2 lakh per 300 kW for thermal applications.
- Under the ‘Development of Solar Parks and Ultra Mega Solar Power Projects’ scheme, the Ministry provides Central Financial Assistance (CFA) of up to INR 25 lakh per solar park for preparation of Detailed Project Report (DPR). Beside this, CFA of up to INR 20.00 lakh per MW or 30% of the project cost, including Grid-connectivity cost, whichever is lower, is also provided on achieving the milestones prescribed in the scheme. *
Deendayal Upadhyaya Gram Jyoti Yojana (DDUGJY) *
- The Ministry of Power launched this scheme with the following components:
- To separate agriculture and non-agriculture feeders to facilitate DISCOMs in the judicious rostering of supply to agricultural & non- agricultural consumers in rural areas.
- Strengthening and Augmentation of Sub Transmission & Distribution infrastructure in rural areas and metering at Distribution Transformers, Feeder and consumers end in rural areas.
- The erstwhile rural electrification scheme was subsumed in DDUGJY as a separate rural electrification component and the approved outlay of the erstwhile scheme has been carried forward to the DDUGJY.
- The total outlay of Deendayal Upadhyaya Gram Jyoti Yojana (DDUGJY) was INR 75893 cr and subsidy was INR 63027 cr.
Production-Linked Incentive (PLI) Scheme *
- Production-Linked Incentive (PLI) Scheme in High-Efficiency Solar PV Modules Sector through the Ministry of New and Renewable Energy was approved with a financial outlay of INR 4500 cr over a five-year period for Enhancing India’s Manufacturing Capabilities and Enhancing Exports – Atmanirbhar Bharat. Solar PV Module
- Expected outcomes/ benefits from the scheme are - Additional 10,000 MW capacity of integrated solar PV manufacturing plants.; Direct investment of around 17,200 cr in setting up solar PV manufacturing projects; Direct employment of about 30,000 and Indirect employment of about 1,20,000 persons; Import substitution of around 17,500 cr every year; Demand of 17,500 cr over 5 years for 'Balance of Materials'.
- Central Government has allocated a total capacity of 39,600 MW of domestic Solar PV module manufacturing capacity to 11 companies, with a total outlay of INR 14,007 cr under the Production Linked Incentive Scheme for High Efficiency Solar PV Modules (Tranche-II). *
- The Tranche-II of High Efficency Solar PV modules is expected to bring in an investment of INR 93,041 cr. It will also generate a total of 1,01,487 jobs with 35,010 getting direct employment and 66,477 being indirectly employed. *
- Domestic solar PV module manufacturing capacity allocated under the PLI Scheme is 48,337 MW, with a cumulative support of more than INR 18,500 Crore by the Government under Tranche-I and Tranche-II till date. *
Energy Storage Systems *
- Policy on Energy Storage system is being drafted to promote the creation of storage systems on a large scale across the country.
- The policy aims at the creation of technology-agnostic storage system across the value chain of the electricity sector viz. at generation, transmission, and distribution levels.
- Energy Storage Systems will benefit Generating Companies, Distribution Companies of the States, Grid Operators, and other players in the electricity value chain.
- They will facilitate Peak shifting, Peak Shaving, Ramp up/ Ramp down, and Frequency Control in the system and enhance the utilization of the Transmission System. ESS is considered essential for a smooth energy transition from coal-based to renewable sources and to a cleaner environment.
Green Open Access Rules 2022
- The Rule has been notified to further accelerate our ambitious renewable energy programmes, with the end goal of ensuring access to affordable, reliable, sustainable and green energy for all. *
- The Green Open access is allowed to any consumer and the limit of Open Access Transaction has been reduced from 1 MW to 100 kW for green energy, to enable small consumers also to purchase renewable power through open access.
- Transparency in the approval process of the open access application. Approval to be granted in 15 days or else it will be deemed to have been approved subject to fulfilment of technical requirements. It will be through a national portal.
- Banking of surplus green energy with the distribution licensee mandated.
- Consumers will be given the green certificates if they consume green power.
- Cross subsidy surcharge and additional surcharge shall not be applicable if green energy is utilized for production of green hydrogen and green ammonia.
(CPSU) Scheme Phase-II *
- The ‘Central Public Sector Undertaking (CPSU) Scheme Phase – II aims to set up a 12 GW grid-connected Solar photovoltaic (PV) Power projects. The eligible organizations are Government Producers (PSUs/ Govt. Organs.) which are under administrative control or have 50% shareholding of Central / State Government. The support offered by the central government is VGF of up to INR 70 lakhs/ MW; actual VGF decided through bidding for VGF required. *
- NLCIL has installed around 1421 MW of Renewable energy and in process of installing 4610 MW under MNRE and CPSU scheme leading to a total of 6031 MW of Renewable Energy by 2030. The expansion of the Renewable Energy of 4610 MW additionally, will be undertaken with an estimated cost of Rs. 23,403 Cr. over a period of eight years. *
- Total of 89.45 MW capacity has been installed under Component-A and around 2.09 lakh pumps have been reported solarized under Component-B and Component-C as on 28.02.2023
- A total demand of 6512 MW made by states under Component-A till 31.03.2026
- Feeder level solarization has been introduced under Component-C of the Scheme.
- Financial Support
Highlights of Budget 2023-24 *
- The total budgetary allocation for FY 2023-24 towards the Ministry of New and Renewable Energy is INR 10,222 cr.
- Investment Opportunities
- The Cooperation Agreement signed between the energy ministries of India and Denmark presents opportunities for cross-border investment in capacity building and development of offshore wind projects. Investors can also explore opportunities in ancillary areas of wind turbine components and ensuring their efficacy and certification upto global standards. *
- Ministry of New & Renewable Energy (MNRE) supports Research, Development & Demonstration projects in the Renewable Energy sector to develop new and renewable energy technologies, processes, materials, components, sub-systems, products & services, standards and resource assessment to create an indigenous market for manufacturing of new and renewable energy systems and devices. *
- In order to attract the large investment for the development of the Offshore wind energy sector in India, the Government of India under the ‘National Offshore Wind Energy Policy’ has announced to develop 30 GW worth of offshore wind energy projects by 2030. *
- Sector Reports
- Ministry of New and Renewable Energy: National Green Hydrogen Mission 2022
- Ministry of Petroleum and Natural Gas: The Green Shift
- Year End Review 2022: Ministry of New and Renewable Energy
- Making India a Leader in Solar Manufacturing | Centre for Energy Finance of the Council on Energy, Environment and Water | 2022
- Foreign Investors
- Enercon (Germany)
- Vestas (Denmark)
- Applied Materials (US)
- Asian Development Bank
- Enel (Italy)
- Gamesa (Spain)
- Orix (Japan)
- Nordex (Germany)
- Mudajaya (Malaysia)
- Ministry of New and Renewable Energy, https://mnre.gov.in/
- PIB Release, https://www.pib.gov.in/PressReleasePage.aspx?PRID=1726184
- IREDA to Create a Green Window for Green Energy Finance, Ministry of New and Renewable Energy, PIB, https://www.pib.gov.in/PressReleasePage.aspx?PRID=1595888
- Year-End Review 2019, MNRE, PIB, https://www.pib.gov.in/PressReleasePage.aspx?PRID=1598948
- Consolidated FDI Policy, https://static.investindia.gov.in/s3fs-public/2020-09/FDI%20Policy%202020%20revised_18%20Sept%202020.pdf
- Cabinet approves Cooperation Agreement between India and Denmark in the field of Renewable Energy with focus on Offshore Wind Energy, PIB, https://www.pib.gov.in/PressReleasePage.aspx?PRID=1570599
- Schemes, Ministry of New and Renewable Energy, https://mnre.gov.in/solar/schemes/
- Ministry of New and Renewable Energy, https://powermin.gov.in/sites/default/files/uploads/Monthly_Summary_for_the_Cabinet_concerning_Ministry_of_Power_for_the_month_of_Sep_2020.pdf
- Ministry of New and Renewable Energy, Monthly Report, https://powermin.gov.in/sites/default/files/uploads/Monthly_Summary_for_the_Cabinet_concerning_Ministry_of_Power_for_the_month_of_Sep_2020.pdf
- PIB Release, https://www.pib.gov.in/PressReleasePage.aspx?PRID=1670598
- PIB Release, https://www.pib.gov.in/PressReleasePage.aspx?PRID=1672580
- Ministry of New and Renewable Energy, Monthly Summary for the Cabinet for November 2020, https://mnre.gov.in/img/documents/uploads/file_f-1607587283931.pdf
- PIB Release, https://www.pib.gov.in/PressReleasePage.aspx?PRID=1676191
- Ministry of New and Renewable Energy, https://mnre.gov.in/img/documents/uploads/file_f-1607587283931.pdf
- PIB Release, https://www.pib.gov.in/PressReleasePage.aspx?PRID=1682467
- PIB Release, https://pib.gov.in/PressReleseDetail.aspx?PRID=1685046