India has roughly 412 GW of installed power capacity as of January 2023, out of which 41 per cent is contributed by renewable power. The target is to have 500 GW of non-fossil fuel based power by 2030 in the country. While this goal seems quite ambitious, considering more than 300 GW of clean energy capacity has to be set up in just eight years, it is not an impossible feat.
After all, India has witnessed an impressive growth in the solar power segment, where the capacity has grown from less than 7 GW in 2015-16 to 64 GW as of January 2023. Thus, taking this into consideration and the projected growth from a vast project pipeline, continued private sector investments, increasing affordability of renewables and a growing commercial and industrial interest in procuring green energy, the 500 GW clean energy target is achievable.
The government on its part has been pro-active in intervening with clear policy and regulatory support as and when required. Even in the recent Union Budget 2023–24, there was a strong focus on green growth and the Indian finance minister stated that India is making rapid progress toward achieving its net zero targets by 2070.
This budget saw allocation of Rs 350 billion for priority investments towards the net-zero goal. Recognising the importance of the nascent but fast evolving green hydrogen sector for India’s overall green energy transition, the National Green Hydrogen Mission has been given a budget of Rs 197 billion with a target to produce 5 MMT of green hydrogen annually by 2030.
A viability gap funding support was also announced for the development of battery energy storage systems with a 4,000 MWh capacity, as storage systems will play a critical role in integrating this massive renewable energy into the grid and ensuring grid stability. On the same lines, a detailed framework for pumped storage projects will also be formulated.
Other provisions and allocations were also announced in diverse segments like biofuels, electric mobility, as well as green financing. Meanwhile, 12 initiatives have been envisaged under the green growth agenda which include green hydrogen mission, energy transition, energy storage projects, renewable energy evacuation, green credit program, and vehicle replacement among others.
Overall, the recent budget announcement gives due importance to not only mature but emerging yet critical segments for the green energy transition. These budgetary allocations are important to ensure a promising path to decarbonization of the country’s energy mix and ultimately transitioning to net zero.
