29 April 2014 — The outlook for Australia’s coal is on the decline. We know China is keen to clean up its act and, besides, it has plenty of its own coal that it can tap in future. India, the other big source of coal demand, is fast developing alternatives. And they’re renewable. In this article Leon Gettler takes a look.
India has the potential to be a world leader in renewable energy. It has one of the largest renewable energy programs in the world, it is one of the top wind energy producing nations and is on a trajectory to become one of the leading solar power producing nations.
India was the first country to set up a ministry of non-conventional energy resources in the early 1980s. The National Action Plan on Climate Change, launched in 2008, aims to have 15 per cent of India’s electricity consumption from renewable energy by 2020. India right now produces slightly more than 12 per cent of its energy from renewables, putting it on track for that goal.
“We are a growing economy. So our energy requirement is also growing. But we don’t produce enough energy to meet even our current needs. With depleting fossil fuel reserves and concerns about its environmental impact, renewable energy is the only long-term solution,” Bibek Bandhopadhyay, advisor at the ministry of new and renewable energy told the Times of India.
There is a good reason for this. It’s a country where more than 400 million people lack electricity. Power retailers were behind on 155 billion rupees ($2.5 billion) of payments to their suppliers as of 31 January, reducing their ability to provide electricity to customers. In July 2012 India experienced the largest blackouts in global history that affected a population of more than 620 million.
They were driven by a mix of forces: several transmission lines were down for maintenance, there were lightning strikes and state governments were not heeding to the directions of the central regulators. The blackouts were a strategic eye opener. They highlighted the collapse of not only the energy infrastructure in the country but also the failure of governance across parties.
Climate change vulnerability
According to the Climate Change Vulnerability Index (CCVI), Bangladesh and India are the most vulnerable to climate change. The study rates Bangladesh as the country most at risk due to extreme levels of poverty and a high dependency on agriculture. Bangladesh has a high risk of drought and the highest risk of flooding, and in October 2010 5000 people were driven from their homes due to flooding. The government has the lowest capacity of all countries to adapt to predicted changes in the climate, the recent study said.
One the world’s fast growing economies, India has been ranked second in vulnerability and the study says it will adversely impact the “country’s appeal as a destination for foreign investment in coming decades”.
“Vulnerability to climate-related events was seen in the build up to the  Commonwealth Games, where heavy rains affected the progress of construction of the stadium and athletes’ village,” the report said.
This makes renewable energy as an important way to bring power to the people and reduce climate change vulnerability.
Ernst & Young says India has abundant untapped renewable energy sources.
It writes: “The country’s large land mass receives one of the highest levels of solar irradiation in the world. It has extensive coastline and high wind velocity in many areas. This provides ample opportunities for the establishment of land-based renewable energy generation as well as for offshore wind farms. In addition, the country’s numerous rivers and waterways have strong potential to generate hydropower. India also has significant potential to produce energy from biomass derived from agriculture and forestry residues.”
India, ranked as one of the most attractive countries for renewable investments by EY this year, plans to double its clean-energy capacity to 55 gigawatts by 2017.
India is a relative newcomer to wind energy, lagging behind the United States and Europe. But according to India’s Ministry of New and Renewable Energy, the Indian wind energy sector has an installed capacity of 20,299 megawatts (as at 31 January 2014). In terms of wind power installed capacity, India is ranked as having the fifth largest installed wind power capacity in the world. Today India is a major player in the global wind energy market.
Narendra Modi, the leader of the Bharatiya Janata Party, which is currently leading in the polls in the lead-up to the general election in May, is a big fan of solar. He pioneered the first incentives for large scale solar power in 2009 in his home state of Gujarat. Modi’s early backing of solar helped make Gujarat home to about 40 per cent of India’s solar capacity. According to Bloomberg, he could create a solar revolution in India. In bad news for Gina Rinehart and Clive Palmer, he’s not a big fan of coal. He’s indicated he wants to reduce India’s dependence on coal, which generates 68 per cent of the country’s electricity. The fossil fuel is supplied by state monopoly Coal India Ltd. at a 44 per cent discount to global prices.
“We have to focus on generating more power from our abundant renewable energy resources,” Modi declared at a rally for 10,000 supporters in central Madhya Pradesh state on 26 February.
Scientific American reports that India plans to build the world’s most powerful solar plant. With a nominal capacity of 4000 megawatts, the ‘ultra mega’ project will be more than 10 times larger than any other solar project built so far, and it will spread over 77 square kilometres of land — greater than the island of Manhattan. The solar photovoltaic power plant will have an estimated life of 25 years and is expected to supply 6.4 billion kilowatt-hours a year, according to official figures. It could help to reduce India’s carbon dioxide emissions by more than four million tons a year.
India’s government also wants to replace 26 million groundwater pumps for irrigation with more efficient pumps that run on solar power, in an effort to relieve farmers of high costs of diesel fuel. That will put less strain on the Indian power grid. Pumping water is critical for Indian agriculture, which otherwise relies on seasonal rain. Falling prices of solar panels means that the payback for a solar water pump system is about one to four years. After weaning agriculture off subsidised diesel, the Indian government could target other sectors like telecommunications, which rely on urban telecom towers.
There is also a lot of focus on turning waste into energy. The Times of India reports that New Delhi Municipal Council is planning to set up small-scale waste-to-plants, bringing down transportation costs and also help effective waste management. It is also looking at processing organic waste into fuel. According to The Hindu, engineering company Satarem India has entered into agreements with the Bangalore and Hyderabad municipal corporations to set up co-combustion plants as public–private partnerships. It plans to do the same in Chennai. In co-combustion, the waste from houses, industries and commercial establishments is transported to the plant and goes through crushing, segregation of metallic objects and heating at a high temperature. The entire operation is mechanised and the manpower required to operate a plant is minimum.
With all major rivers like the Ganges, India has fifth largest exploitable hydro-power resources in the world. According to the World Bank, one of the Indian government’s top priorities has been to provide power to the 40 per cent of the population that doesn’t have it and the government plans to do this through the country’s vast hydropower sources, when only 23 per cent of it is now in use.
And finally, the Indian government is looking to sell green bonds and lending the proceeds to wind and solar farm developers at a cheaper rate than banks. In addition to green bonds, the government could step in with other financing instruments such as infrastructure debt funds, partial credit guarantees for projects and a low-cost credit line to mitigate currency depreciation risk.
For all its problems with electricity and infrastructure, India is becoming a renewables leader. Australia could learn a lot from it.