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India is set to experience a substantial increase in investments in renewable energy projects, with estimates suggesting a rise of over 83% to around $16.5 billion by 2024. The country is focusing on energy transition to reduce carbon emissions as part of its ambitious target to achieve 500 GW of renewable energy by 2030. India aims to reduce its overall power generation capacity from fossil fuels to less than 50% and has committed to achieving net zero emissions by 2070.
Union Power and New & Renewable Energy Minister R K Singh has stated that as much as 65% of power generation capacity will come from non-fossil fuels by 2030, surpassing the set target of 50%. Singh predicts that India will witness the addition of 25 GW of renewable energy capacity, requiring an investment of approximately Rs 1,37,500 crore (about $16.5 billion) in 2024. This is higher than the 13.5 GW added in 2023, which required an investment of Rs 74,250 crore (nearly $9 billion).
In addition to solar and wind energy, India is placing a strong emphasis on green hydrogen as a means to reduce reliance on fossil fuels, particularly diesel used in long-haul vehicles. The Union Cabinet approved the National Green Hydrogen Mission in January this year, with an outlay of Rs 19,744 crore. The Solar Energy Corporation of India (SECI) has also called for bids to incentivize the production of green hydrogen and electrolyser manufacturing facilities.
Several companies have expressed interest in these incentives, including Reliance Electrolyser Manufacturing, Adani New Industries, L&T Electrolysers, and Bharat Heavy Electricals for electrolyser manufacturing. ACME Cleantech Solutions, Torrent Power, UPL, and GH4INDIA are among the companies bidding for incentives to set up green hydrogen production facilities. The National Green Hydrogen Mission aims to establish India as a global hub for green hydrogen manufacturing, with a target of developing 5 million metric tonnes per annum of green hydrogen production capacity by 2030.
To support the production of green hydrogen and electrolysers, develop the green hydrogen ecosystem, and enable industrial decarbonization, the Strategic Interventions for Green Hydrogen Transition (SIGHT) scheme has been introduced with a backing of Rs 17,490 crore. The Chairman of CII’s Taskforce on Green Hydrogen and Co-Chairman of CII Renewable Energy Council, Vineet Mittal, believes that India has the potential to meet the increasing demand for green hydrogen derivatives and become a production hub.
Overall, the outlook for renewable energy in 2024 is positive, with expectations of continued investment and technological advancements in renewable energy and battery storage. The Central Electricity Authority (CEA) report on Optimal Generation Mix by 2030 outlines a comprehensive vision for the sector, targeting 292 GW of solar, 100 GW of wind, and 18 GW of hydro energy. It is recommended that large-scale tenders be issued by Renewable Energy Implementing Agencies (REIAs) to maximize the execution capabilities of developers.
Shekhar Dutt, Director General of the Solar Power Developers Association (SPDA), suggests mandating Green Hydrogen Consumption Obligations (GHCOs) for key industrial sectors to promote the usage of green hydrogen. Girishkumar Kadam, Senior Vice President & Co-Group Head – Corporate Ratings at ICRA, expects India’s installed renewable energy capacity (excluding large hydro) to increase to about 170 GW by March 2025 from the current level of 132 GW. Tendering activity is likely to improve significantly, with over 16 GW projects bid out and another 17 GW bids underway in the current fiscal year, aligning with the government’s target of 50 GW annual bidding announced in March 2023.
Renewable energy investments in India are set to skyrocket by 83% to reach $16.5 billion in 2024. This surge in investment signifies the growing focus on sustainable energy sources and reducing reliance on fossil fuels. India has been actively promoting renewable energy through various initiatives, including the National Solar Mission and the introduction of solar parks. The country’s commitment to clean energy is expected to attract both domestic and international investors, driving the rapid growth in renewable energy investments over the next few years. This investment surge will not only contribute to India’s climate goals but also create job opportunities and stimulate economic growth in the renewable energy sector.
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