Driving India’s energy transition

India needs a diverse set of flexibility options for successful system integration of wind and solar PV—according to an International Energy Agency (IEA) report.

“This flexibility is available not only from the coal fleet – it can also come from natural gas capacity, variable renewables themselves, energy storage, demand-side response and power grids,” highlights the report.

As many of these solutions are not yet fully utilised in India, the report empahsises on putting in place “electricity market reforms that enable the appropriate price signals and create a robust regulatory framework” to fully activate a diverse set of flexibility options.

India has seen a strong growth of renewables, which now account for almost 23% of the country’s total installed capacity. By December 2019, India had deployed 84 GW of grid-connected renewable electricity capacity, against total generating capacity of 366 GW.

Further, energy efficiency improvements in India cut 15% of additional energy demand, oil and gas imports, and air pollution as well as 300 million tonnes of CO2 emissions between 2000 and 2018—according to IEA analysis.

Lauding the government for these achievements, IEA report highlights further improving energy security as a key priority for India’s economy, with the country’s demand for energy set to double by 2040.

While India strives for energy security with 450 GW of renewables in the electricity mix and a range of energy sector reforms, the country will “require a focus on unlocking the flexibility needed for effective system integration of these renewables.”

Need for robus policy governance

In India’s renewables-rich states, the share of variable renewables in electricity generation is already above 15%–a level that calls for dedicated policies to ensure they integrate smoothly into the power system.

The report highlights that government thinktank NITI Aayog can play a strong role in working with the states to implement power sector reforms, advance grid integration, improve flexibility and coordinate energy policy decisions.

The review also strongly encourages India to institutionalise energy policy coordination across government with a national energy policy framework. 

“India could benefit from integrating research, development and deployment (RD&D) priorities with broader energy policy goals. Adopting an overarching energy RD&D strategy would provide a framework for co‑ordinating the widespread activities of ministries that are engaged in directing, performing and funding energy RD&D. It would also support the engagement of private and public industry actors. Such an endeavour would benefit from the consistent collection and monitoring of energy RD&D data,” stated the report.

Furthermore, as the energy sector is a large water user, adaptation and resilience of the energy system to extreme climate impacts like water stress should be a high political priority. As India’s energy demand continues to grow, the government should ensure that energy planning takes into account the water–energy nexus, as well as future space cooling needs.