India can save $19.5 bn per year by shifting from coal to clean power, says new study

India can save up to $19.5 billion a year if it goes with its plan to add 76 GW of utility-scale solar and wind power by 2025, new research from Global Energy Monitor has stated. 

The report, which has analysed data from the Global Solar Power Tracker and the Global Wind Power Tracker, has ranked India in the top seven countries globally in terms of prospective renewable power.  

The report has added that this buildout can avoid the use of almost 78 million tons of coal annually, or roughly 32 GW in coal power plant capacity, which is more new coal capacity than the country has added since 2018. 

“Annual savings in India can skyrocket if the coal-to-clean switch matches the country’s ambitions. India plans to add an additional 420 GW of wind and solar power by 2030, which would increase the annual savings from avoiding coal power to more than $58 billion, with total savings reaching $368 billion by 2030,” the report noted. 

“If India were to bring online all of its planned utility-scale solar and wind projects, it would cost roughly $51 billion. But with a US$19.5 billion annual savings in direct fuel costs, India could pay for this in just two and a half years,” it added. 

India accounts for 5 per cent of all prospective utility-scale solar power globally, trailing only China, the US, and Australia, while placed at the 17th position globally in prospective wind power capacity. 

 “Save money, slash emissions – India’s switch from coal to clean power is a win-win. A promising step towards meeting the country’s net zero emissions target by 2070, India will be richer and cleaner by quitting coal,” said Shradhey Prasad, project manager for the Global Wind Power Tracker. 

“Costs for solar and wind power continue to plummet, and compared to volatile fossil fuel prices, renewables present a far better option for building new energy infrastructure,” he added. 

India’s renewable power goals 

PM Narendra Modi in 2021 said that India will reach its net-zero emissions by 2070. Subsequently, India announced plans to source half of its electricity needs from non-fossil fuel sources by 2030. India’s current energy mix is still dominated by coal. At present, coal accounts for 44 per cent of India’s primary energy sources and 70 per cent of its power generation.  

The country’s coal-fired power plants have an average age of 13 years and India has 91,000 MW of new proposed coal capacity in the works, second only to China. The Centre’s Draft National Electricity Plan 2022 has stated that India’s coal share in the electricity generation mix will decrease to 50 per cent by 2030, compared to the present-day count of 70 per cent. Renewable energy currently contributes about 10 per cent of India’s electricity needs. 

Hurdles India is facing 

As per estimates, India missed its target to install 175 gigawatts of renewable energy in its overall power production by 2022. Now viewing its progress and renewable energy target of installing 450 gigawatts by 2030, India needs to go big time on clean energy at a far greater rate than it is doing now. 

But there are many hurdles in the path. First, creating finance for green targets. Besides, acquiring land for clean energy projects is a big issue as there is strong resistance from local communities. Building energy storage and enacting more progressive policies are some of the roadblocks for the governments, both at the central and the state levels. 

Despite all this, Union power minister R K Singh is quite positive about India’s achievement in the renewable energy transition. Recently at the annual World Economic Forum meeting at Davos, Singh claimed India achieved its renewable energy transition target nine years ahead of time.