Toward a sustainable energy future: India’s pathway to achieving net zero

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Synopsis India’s pursuit of net-zero emissions by 2070 is a monumental effort to balance rapid economic growth with environmental sustainability. This transformation emphasizes renewable energy advancements, including solar power, green hydrogen, and biofuels, alongside robust policy frameworks like the Panchamrit strategy. The nation’s energy transition requires an estimated $150–$200 billion annually, with initiatives like sovereign green bonds already making strides. However, reliance on coal persists, reflecting the complex trade-offs between energy security and decarbonization. Programs such as PM-KUSUM and Indian Railways’ electrification efforts highlight societal impacts, positioning India as a global model for sustainable development amidst challenges. Image courtesies: AI and Ministry of New and Renewable Energy

India’s commitment to achieving net-zero emissions by 2070 is a bold statement of intent, showcasing the nation’s determination to balance rapid economic growth with environmental sustainability. As the world’s most populous country and the third-largest emitter of greenhouse gases, India’s energy transition is critical not only for its citizens but for global climate goals. This article dives into the multifaceted strategies, challenges, and real-world implications of this monumental shift, offering insights into what lies ahead.

India’s energy puzzle: Growth versus sustainability

India is at a unique crossroads. With energy demand projected to grow at over 6% annually until 2026, fuelled by rapid urbanization and industrialization, the challenge is clear: meet this demand sustainably. As of 2023, coal remains the backbone of India’s energy mix, contributing 59% to its primary energy supply. This reliance on coal, however, conflicts with India’s ambitious renewable energy targets under the Panchamrit framework, which include generating 50% of its electricity from non-fossil fuel sources by 2030.

Despite these challenges, India has made significant strides. Renewable energy capacity has grown fivefold over the past decade, reaching 203 GW in 2024. The government’s robust policy support, including production-linked incentives for solar manufacturing and financial frameworks like green bonds, underscores the nation’s commitment to decarbonization.

The renewable energy revolution

Solar power: India’s rising star – Solar energy leads the charge in India’s renewable energy sector, thanks to its abundant sunshine and government initiatives like the Solar Parks Development Scheme. As of 2024, India has achieved a solar power capacity of 81.8 GW, accounting for over 40% of the country’s renewable energy capacity additions. Policies such as inter-state transmission charge waivers and rooftop solar incentives have further catalyzed growth.India

However, challenges persist. Grid infrastructure must be modernized to handle intermittent solar energy. Moreover, states with high solar potential often face delays in land acquisition and project approvals, underscoring the need for streamlined processes.

Biofuels and green hydrogen: untapped potential – The National Biofuels Policy of 2018 set ambitious targets for ethanol blending, with India achieving 10% ethanol blending two years ahead of schedule in 2022. The next milestone — 20% ethanol blending by 2025 — holds promise for reducing oil imports and boosting agricultural incomes.

Similarly, green hydrogen is emerging as a game-changer. With a dedicated mission launched in 2023, India aims to become a global hub for green hydrogen production. By leveraging its natural resources, India could decarbonize hard-to-abate sectors like steel and cement while positioning itself as an exporter of this clean energy source.

Financing the energy transition – The financial implications of India’s energy transition are staggering. An estimated $150–$200 billion in annual investments is needed until 2070 to achieve net zero. While only 25% of this funding is currently secured, innovative financial instruments are closing the gap.

Sovereign green bonds: a success story – In 2023, India raised $2 billion through sovereign green bonds, signalling investor confidence in the nation’s green initiatives. These funds are earmarked for renewable energy projects and green infrastructure, aligning with India’s broader climate goals.

International collaboration: the need of the hour – access to affordable financing and cutting-edge technology is critical for accelerating the transition. Partnerships with countries like Japan and the EU, which have recently issued tenders for green hydrogen supply, highlight the potential for global cooperation.

Counterpoints: Coal’s enduring role

While India’s renewable energy growth is commendable, the continued reliance on coal raises questions about the feasibility of its net-zero targets. Coal production is expected to reach 1.5 billion tons by 2030, driven by rising energy demand. Proponents argue that coal remains essential for energy security and employment, with the sector supporting over 4.4 lakh jobs and contributing significantly to state revenues.

Balancing act – Critics, however, highlight the environmental costs, urging a faster pivot to cleaner energy. The government’s introduction of the Carbon Credits Trading Scheme (CCTS) is a step toward addressing these concerns, incentivizing industries to adopt low-carbon technologies.

The road ahead: Electrification and mobility

India’s energy transition extends beyond power generation to sectors like transportation and industry.

Electric vehicles (EVs): a booming market – The EV ecosystem in India is thriving, with sales surging across all segments. Policies like the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) scheme and state-level incentives have spurred growth. However, challenges in charging infrastructure and battery manufacturing must be addressed to sustain this momentum.

Indian Railways: leading the charge – The Indian Railways’ Mission 100% Electrification aims to achieve net zero by 2030, with initiatives like energy-efficient technologies and afforestation contributing to this goal. The anticipated annual savings of INR 14,500 crore (USD 1.71 billion) underscore the economic and environmental benefits of electrification.

Engaging communities: Societal impacts

India’s energy transition isn’t just a technological or financial endeavour — it’s a societal transformation. Programs like the PM-KUSUM scheme empower rural communities by integrating solar energy into agricultural practices. Similarly, rooftop solar projects in urban areas provide affordable energy solutions, fostering grassroots participation in the energy revolution.

A blueprint for the world

India’s journey to net zero is a testament to its resilience and innovation. By integrating renewable energy, fostering financial collaboration, and addressing societal impacts, India is crafting a roadmap that could serve as a blueprint for other developing nations. While challenges remain, the nation’s proactive policies and unwavering commitment signal a brighter, greener future.

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