5 min

Green Revolution 2.0

India Overview

Posted by: Simon Lemin Date: 28 Jul 2023

India has to walk a tightrope between meeting the economic aspirations of millions of its people and achieving its sustainability goals. So far, it has done this laudably.  

At the Conference of Parties (COP) 26 held in Glasgow in 2021, India committed to achieving a Net-Zero target by 2070. The long-term target encapsulated a few short-term goals:

  • Enhance non-fossil energy capacity to 500 GW by 2030.
  • Meet 50% of its energy requirements from renewable energy by 2030.
  • Reduce the total projected carbon emissions by one billion tonnes by 2030.
  • Reduce the carbon intensity of its economy by less than 45% by 2030.

Vulnerability to Climate Change

Because of its geography, demography, topography and economy, India is among the countries most vulnerable to the climate emergency that the world now faces. It is the world’s most populous country, home to over 1.4 billion people.1

According to estimates by India’s government, 54.6% of India’s population depends on agriculture for their livelihood. Climate change is likely to hit this population – and consequently the economy hard. According to research by National Innovations on Climate Resilient Agriculture (NICRA), a body under the aegis of the union agriculture ministry, a 1-2°C rise could potentially decrease rice production by about 0.75 tonnes per hectare (t/ ha) in inland zones and 0.06 t/ha in coastal regions. Similarly, a 0.5°C increase in winter temperatures is projected to reduce wheat yields by 0.45 t/ha.2

As the Indian government’s Intended Nationally Determined Contribution (INDC) to the United Nations Framework Convention on Climate Change (UNFCC) noted, “Rapid urbanization in the country will be one of the most dominant trends in the coming years. It is expected that about 40% of the population in 2030 would be urban as against 30% currently. As population expands and incomes grow, this shift will likely be realized alongside demographic changes that will exponentially increase the demand for urban amenities like housing, energy, transport, water, waste disposal.”3

As the migration of rural population into urban areas gathers steam, a majority tend to move into marginal areas where they are vulnerable to crises like flooding caused by intensive and unpredictable rainfall – itself a result of climate change.

As the INDC put it, “In a way, India’s development process is doubly challenging. It not only has to complete the current unfinished development agenda, it has to strategize for future pressures that may increase the magnitude of this development gap.” The difficult task before the government is to do it in a sustainable manner.4

The Tightrope Walk

The Indian economy has done spectacularly well in the last two decades – barring the degrowth during the pandemic. According to Indian government data, GDP grew from about USD 1.69 trillion in 2012 to about USD 3.75 trillion in 2022 and is expected to surpass USD 6.3 trillion by 2030.5

What is powering this growth are huge investments in infrastructure which, as a share of GDP, have tripled in the last decade. During the same period, the length of the road network has increased by about 25%, the number of airports doubled and the country now has an estimated 900 million broadband users, behind only China.

While the debate among economists on the exact numbers, there is consensus that this economic growth has resulted in huge reduction of poverty in the country. What is even more laudable is that India has been able to do this while meeting its sustainability pledges and driving a range of policy interventions to reduce the nation’s carbon emissions.

Meeting its Sustainability Pledges

At the Conference of Parties (COP) 21 in Paris in 2015, India committed to a 40% share of power generation from non-fossil fuel sources by 2030. According to India’s Ministry of New and Renewable Energy, “a total of 174.53 GW capacity from non-fossil fuel based energy resources has been installed in the country as on 31.12.2022, which includes 167.75 GW Renewable Energy and 6.78 GW Nuclear Power. This comes to 42.53% of the total installed generation capacity in the country, i.e. 410.34 GW.”6  What is remarkable is that this was achieved seven years before the 2030 deadline!

The COP26 target that the Indian government has set of an additional 500 GW of renewable capacity by 2030 is undoubtedly ambitious, especially because it is more than the total installed generating capacity – from all sources carbon-based as well as renewable – in 2022.

How is India planning to achieve this target? It has initiated several policy measures; these include:

  • Permitting Foreign Direct Investment (FDI) up to 100 per cent under the automatic route, Waiver transmission charges for inter-state sale of solar and wind power for projects to be commissioned by 30th June 2025
  • Setting up of Ultra Mega Renewable Energy Parks to provide land and transmission to RE developers for installation of RE projects at large scale
  • Laying of new transmission lines and creating new sub-station capacity under the Green Energy Corridor Scheme for evacuation of renewable power
  • Standard Bidding Guidelines for tariff-based competitive bidding process for procurement of Power from Grid Connected Solar PV and Wind Projects
  • Launch of Green Term Ahead Market (GTAM) to facilitate the sale of Renewable Energy Power through exchanges.
  • National Green Hydrogen Mission has been approved with an aim to make India a global hub for the production, utilisation and export of Green Hydrogen and its derivatives.7

India has one huge advantage that several countries of the North lack. It is a sun-drenched country with low labour costs, making it one of the cheapest places to produce solar power. This, coupled with the government’s policies and falling costs of renewable energy, has meant that the Indian private sector has announced plans to invest a massive USD 200 billion in setting up solar and wind farms, manufacturing solar panels and wind turbines and setting up Green Hydrogen capacities.8

Other companies are investing massively in the world’s biggest network of grid-scale energy storage using a technology called pumped hydro. (Using solar or wind power to pump water into elevated holding tanks that can then be released to turn turbines and generate power whenever electricity is needed). According to projections by the International Energy Agency, by 2026, India is likely to have the highest pumped hydro capacity in the world.9

To decarbonise critical industries like steel and fertilisers, massive investments are made in Green Hydrogen by the Indian private sector, foreign investors and public sector oil companies like Indian Oil which has announced plans to invest USD 25 billion in its journey to reach net zero emissions by 2046.10  Currently, the production of Green Hydrogen costs about USD 4/per kg. Indian companies, as well as global investors, aim to reduce it by at least 50% (one claim put it at 75%) through a combination of technological innovations and scale.11

TÜV SÜD is working with several Indian companies as well as the government in providing sustainability services in the areas of renewable energy, new mobility and carbon management.

The first Green Revolution changed India from a basket case to a bread basket where agricultural exports now account for about seven per cent of India’s outbound trade. Green Revolution 2.0, which is now underway, could see India meeting its sustainability pledges to mitigate the climate emergency.

OUR SUSTAINABILITY SERVICES


Sources:

1 https://www4.unfccc.int/sites/submissions/INDC/Published%20Documents/India/1/INDIA%20INDC%20TO%20UNFCCC.pdf
2 www.nicra-icar.in/nicrarevised/images/Books/Vulnerability%20of%20agriculture%20to%20climate%20change.pdf
3 https://www4.unfccc.int/sites/submissions/INDC/Published%20Documents/India/1/INDIA%20INDC%20TO%20UNFCCC.pdf
4 ibid
5 ibid
6 https://pib.gov.in/PressReleasePage.aspx?PRID=1897045
7 ibid
8 https://www.economist.com/briefing/2022/10/20/will-india-become-a-green-superpower
9 https://www.iea.org/data-and-statistics/charts/pumped-storage-hydropower-storage-capability-by-countries-2020-2026
10 https://www.businesstoday.in/latest/corporate/story/ioc-plans-to-set-up-green-hydrogen-plants-at-all-refineries-by-2047-aims-to-achieve-net-zero-emission-371488-2023-02-26
11 https://www.economist.com/briefing/2022/10/20/will-india-become-a-green-superpower

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