Wed. Aug 10th, 2022

As the cost of clean technology declines and the global energy crisis draws capital away from fossil fuels, increasing clean energy investments, as well as an increasing offshore wind industry, are pointing to a new renewable energy surge in India. The Institute for Energy Economics and Financial Analysis’ (IEEFA) Vibhuti Garg, an energy economist, reports that the Russia-Ukraine conflict has increased the cost of imported coal and gas and is putting more strain on the dispatchability of expensive power.

“A more affordable electricity source to supply electricity demand around-the-clock is renewable energy paired with energy storage technology like pumped hydro and battery storage.”

Raj Kumar Singh, India’s minister of power and renewable energy, told Bloomberg Green that the change “will actually expedite the energy transition.” “Once you have feasible round-the-clock renewables, that is renewables plus storage, then the story for fossil fuels is over.”

According to a Garg report published in June, India will invest a record $14.5 billion in renewable energy during the 2021–22 fiscal year, up 125 percent from the previous year and 72 percent from levels prior to the pandemic. Acquisitions made up 42% of all investments, and the majority of other significant transactions were packaged as equity investment, bonds, debt, joint ventures, and mezzanine funding, a combination of debt and equity financing. Solar made up 42% of investments, while overall renewable energy made up 54%. Rooftop solar received 2% of the remaining funds, followed by wind (1%), green energy finance, and 1%.

Garg anticipates that India’s current growth trend in renewable energy will continue, but she also believes that government action is needed to decarbonize “hard-to-abate sectors” like petroleum refining and fertilizer manufacturing, where green hydrogen intake could increase. By establishing time-based goals, the government could also promote growth in important sectors such as energy storage.

The ministry of renewable energy in India has reactivated its 2015 offshore wind power objectives with a blueprint to set up 30 gigawatts by 2030, according to Garg.

The move is appropriate now, she writes, as offshore project costs are decreasing globally.

Offshore wind is becoming more and more popular as a fresh and practical clean energy option worldwide. 30 percent of the world’s new capacity, or 16.9 gigawatts, was installed by China alone in 2021. According to the Financial Express, India’s development has been hampered thus far by offshore wind’s high cost relative to onshore wind and solar.

However, offshore turbines will be crucial in decarbonizing India’s power sector, controlling peak demand, and enhancing the benefits of resource diversity. The development of additional renewable energy facilities in India will provide investors the confidence to spend more to grow the sector as offshore wind becomes a globally viable energy source. The country could then address its growing electricity demand sustainably by increasing offshore wind investment. Offshore wind power offers energy security against upsets from the volatility of fossil fuel prices, even with today’s higher tariffs, according to the Financial Express.

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