In a situation without Covid-19, India was envisioned to have a strong power demand in the coming decade. The Central Electricity Authority, in its report, “Optimal Generation Capacity Mix for 2029-30”, had projected the peak power demand and energy requirement to grow by 50 per cent. Chart 1 shows that the first half was expected to bring most of it. However, IEA’s new assessment finds that the pandemic has chipped away a part of the demand permanently, and that it will now grow along a lower normal.
The business-as-usual scenario (IEA’s stated policies scenario) finds India’s energy demand growing only 33 per cent by 2030, chart 2 shows. In competing scenarios wherein India adheres strictly to its green energy goals, IEA surprisingly believes energy demand in India may decline due to inherent efficiency brought in by cleaner sources of energy.
But how is India’s electricity mix today?
More than half of India’s installed power generation capacity uses coal as primary fuel. In 2030, it will still be the leading power source in terms of capacity, chart 3 reveals. Though solar is expected to take off, its efficacy in catering to base load is doubtful.
India’s coal dependence gets highlighted if we compare it with other emerging and advanced economies. Chart 4 maps different countries across electricity generation according to the source. It shows that in India, the share of coal in power generation is even higher than in China.
If coal remains dominant in the energy mix, India’s carbon footprint may double in two decades. However, IEA estimates that India may cut carbon emissions by 2 gigatons if it follows the path of sustainable development. Prime Minister Narendra Modi recently underlined the importance of climate justice, suggesting that developing countries would need breathing space to alleviate poverty, as against hard targets.
India has made strides in adding clean energy capacity in the past decade, but every new unit of renewable energy (RE) has come with an increase in coal-based generation, and not by replacing it.
While annual RE capacity addition zoomed over the last few years, the pandemic seems to have hurt new addition, shows chart 6.