Powering the Future: India’s uneven path to electricity transition

Posted on 16 Nov 2024

Synopsis

Surging electricity demand driven by industrialisation and urbanisation has brought India to a critical point in its energy transition, where sustainability and growth must align. While states like Karnataka and Gujarat lead with impressive renewable energy integration and robust policy frameworks, others, such as Bihar, Jharkhand, and Uttar Pradesh, struggle with systemic challenges like weak infrastructure and outdated policies. Decarbonisation remains the core goal, with approaches ranging from hydropower utilisation to innovative rooftop solar projects. However, uneven progress and gaps in market enablers, such as green tariffs and electric vehicle policies, highlight the need for tailored strategies. Emerging technologies like battery storage and green hydrogen promise transformative change but require significant investment and policy support. India’s electricity transition reflects both the opportunities and complexities of balancing economic growth with environmental goals, emphasising the urgency of collaborative, inclusive, and region-specific solutions to achieve equitable progress nationwide.

Driven by rapid industrialisation, urbanisation, and population growth, India is witnessing a surge in electricity demand at an annual growth rate of 6.5%. As one of the world’s fastest-growing economies, the country stands at the heart of a pivotal energy transition, where balancing developmental aspirations with sustainability goals has become more critical than ever.

The stakes are high: electricity generation accounts for nearly half of India’s carbon dioxide emissions. Transitioning to cleaner energy sources is not only imperative for meeting climate commitments but also vital for fostering long-term economic resilience. Yet, while national policies set ambitious targets, the true test lies in the hands of individual states, where progress has been uneven and, in some cases, alarmingly slow.

Karnataka and Gujarat: Shining examples of progress

Among India’s 28 states, Karnataka and Gujarat have emerged as exemplary leaders in electricity transition. Karnataka’s renewable energy policies have enabled it to achieve an impressive 37% share of renewables in its electricity consumption. It has also excelled in energy efficiency, ranking high in the State Energy Efficiency Index (SEEI). The state’s holistic approach includes adding renewable capacity, lowering emissions intensity, and fostering market innovations.

Similarly, Gujarat’s consistent performance underscores its strategic focus on clean energy. Over the last five years, the state has added an astounding 12 gigawatts (GW) of renewable energy capacity, making it a frontrunner in the sector. Gujarat also leads in implementing robust market enablers, such as green tariffs and renewable energy policy frameworks, which have attracted significant private sector investment.

Notably, both Karnataka and Gujarat have demonstrated how integrating renewables with prepared power systems and strong regulatory frameworks can create a sustainable and scalable model for clean energy adoption. Their achievements stand as a blueprint for others to emulate.

Uneven progress: Kerala, Haryana and Punjab

Not all states have matched the strides made by Karnataka and Gujarat. Kerala, for instance, is a strong performer in decarbonisation, with 29% of its electricity consumption coming from renewable sources. However, it struggles to develop market enablers such as green tariffs and policy incentives, which are critical for sustaining progress.

Haryana presents a different story. It has significantly leveraged its renewable energy potential, adding over 1 gigawatt of capacity since 2019. Despite these gains, the state lags in infrastructure readiness, which could undermine its ability to integrate additional renewable capacity. Punjab, while commendable in energy efficiency, faces similar challenges, particularly in policy frameworks and renewable infrastructure.

This uneven progress highlights a broader issue: while some states excel in certain areas, they fall short in others, making their transition paths inconsistent and often unsustainable.

Andhra Pradesh: A case of unrealised potential

Andhra Pradesh offers a compelling example of unrealised potential. The state has been a significant contributor to India’s renewable energy capacity, but its power ecosystem remains ill-prepared for a smooth transition. This lack of readiness threatens to derail its progress, underscoring the need for a balanced approach that emphasises both capacity expansion and ecosystem development.

For Andhra Pradesh, the key lies in addressing gaps in infrastructure and regulatory support while maintaining its momentum in renewable capacity addition. This dual focus could help the state unlock its full potential and sustain its leadership in the renewable energy sector.

Struggling states: Bihar, Jharkhand, West Bengal and Uttar Pradesh

At the other end of the spectrum are states like Bihar, Jharkhand, West Bengal, and Uttar Pradesh, which remain far behind in the electricity transition. These states face deep-seated structural issues, including weak DISCOM performance, inadequate policy frameworks, and insufficient investment in renewable energy infrastructure.

Jharkhand, for instance, has achieved only 7% of its renewable energy target, while Bihar’s renewable energy policy has remained unchanged since 2017. West Bengal and Uttar Pradesh struggle with resource constraints and policy inertia, which hinder their progress.

These challenges are compounded by socio-economic factors, such as lower levels of industrialisation and limited financial resources. Addressing these issues requires tailored strategies that account for the unique contexts of these states. For example, states with limited solar or wind potential could focus on energy efficiency initiatives or explore alternative renewable sources such as biomass and small hydro.

Decarbonisation: The core of the transition

Decarbonisation is central to India’s electricity transition. States like Himachal Pradesh and Uttarakhand have leveraged their abundant hydropower resources to achieve low emissions intensity. Himachal Pradesh, for example, sources nearly 70% of its electricity from hydro, positioning it as a leader in decarbonisation.

However, not all states have access to such natural advantages. Rajasthan, despite adding an impressive 16 GW of renewable capacity since 2019, continues to grapple with high emissions intensity. Tamil Nadu faces similar challenges, with only 16% of its electricity consumption coming from renewables.

Delhi presents an interesting case study. With 71% of its renewable energy coming from rooftop solar, the city is a leader in distributed energy solutions. Yet, its overall decarbonisation metrics remain subpar due to gaps in policy support and implementation. This duality underscores the complexity of electricity transition, where progress in one dimension does not always translate into success across the board.

The role of market enablers

Market enablers, such as green tariffs, electric vehicle (EV) policies, and storage solutions, play a pivotal role in accelerating the electricity transition. Odisha has emerged as a leader in this area, adopting progressive green tariffs and fostering a robust EV ecosystem. These initiatives demonstrate how market readiness can complement decarbonisation efforts and infrastructure development.

Karnataka also leads the way in EV adoption, boasting over 5,000 public charging stations—the highest in the country. By integrating market enablers with renewable energy policies, the state has created a conducive environment for clean energy adoption.

Global context: Lessons from other nations

India’s electricity transition journey offers valuable parallels with other nations. For instance, Brazil, with its extensive reliance on hydropower, has achieved a significant decarbonisation of its electricity sector. Meanwhile, South Africa, which faces similar challenges of uneven state-level progress, has initiated targeted strategies to address disparities.

Comparing these experiences highlights the importance of regional cooperation, policy alignment, and innovation in addressing the challenges of clean energy adoption.

Impact on consumers

The electricity transition also has significant implications for consumers. Renewable energy adoption can lower electricity costs, particularly in states that invest in decentralised solutions like rooftop solar. Additionally, the expansion of EV infrastructure offers consumers cleaner and more affordable transportation options. However, states that lag in renewable integration risk higher electricity tariffs due to reliance on costly fossil fuels.

Future outlook: The path ahead

Looking ahead, emerging technologies like battery storage and green hydrogen could play a transformative role in India’s energy landscape. Battery storage solutions will be crucial for managing peak loads and integrating intermittent renewable sources, while green hydrogen holds promise for decarbonising industries and transportation.

The success of these technologies will depend on supportive policies, investment incentives, and international collaboration. India’s leadership in forums like the G20 provides an opportunity to attract global support for its clean energy initiatives.

Recommendations for accelerating progress

To address the disparities in its electricity transition, India must adopt a multi-pronged approach. First, it is crucial to strengthen state-level regulatory frameworks to ensure compliance and promote the adoption of renewable energy. Additionally, a focus on decentralised renewable solutions will enhance energy access and resilience, particularly in rural and remote areas. Bridging regional disparities is also essential, requiring tailored strategies for lagging states to bring them up to speed. Investing in market enablers such as green tariffs and EV infrastructure will create a more supportive ecosystem, driving the transition forward. Finally, aligning state-level policies with national and global targets is vital to ensure cohesive progress and the achievement of overarching sustainability goals.

A collaborative push towards sustainability

India’s electricity transition is a story of contrasts—rapid progress in some areas and persistent challenges in others. While Karnataka and Gujarat have set benchmarks for success, other states reveal the systemic gaps that must be addressed to achieve equitable progress.

As India moves closer to its ambitious renewable energy targets, the need for cohesive, inclusive strategies has never been more urgent. By learning from the successes and shortcomings of individual states, the country can craft a comprehensive plan that balances growth with sustainability.

India’s journey is not just a national imperative but a global example of how diverse economies can transition to clean energy while fostering development. With strategic interventions and collaborative efforts, India can turn its electricity transition into a model for the world.

(Prasad Nair is a Delhi-based journalist. He can be contacted at mail@indoen.com)

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