Renewables to Lead India’s Power Mix by 2070

Syllabus: GS3/Energy and Infrastructure

Context

• A study titled “Scenarios Towards Viksit Bharat and Net Zero” by NITI Aayog projects a shift in India’s electricity mix from coal dominance to renewable leadership by 2070.

Present Electricity Landscape of India

• Coal remains the backbone of India’s power system, accounting for nearly 74% of electricity generation, ensuring dependable and low-cost base-load supply.
• As per IRENA RE Statistics 2025, globally, India stands 3rd in Solar Power installed capacity, 4th in Wind Power capacity and 4th in total Renewable Energy capacity.
• India’s total installed capacity stands at 513 GW, of which 48% is fossil-based, 50% is from renewable energy sources and 1.7% is from nuclear energy.
• However, renewable energy’s share in actual generation increased only from 19.6% (2013-14) to 22% (2024-25), reflecting utilisation challenges.
• Projections Under Current Policy Scenario (CPS):
  • Renewable energy’s share in electricity generation could rise from ~20% in 2024-25 to over 80% by 2070.
  • Coal’s share could decline sharply to 6–10% by 2070.

Constraints in Renewable Energy Generation

• Low Capacity Utilisation Factor (CUF): Clean energy sources are intermittent and weather-dependent. Hence, their actual output is much lower despite high capacity.
  • Eg: Solar CUF: ~20%, Wind CUF: ~25–30%, Coal CUF: ~60%, Nuclear CUF: ~80%.
• Base Load Dependency on Coal: Coal continues to supply over 75% of India’s electricity demand, especially at night when solar isn’t available.
  • India’s grid still depends heavily on thermal sources for round-the-clock (RTC) power.
• Storage and Transmission Limitations: Lack of grid-scale battery storage prevents storing surplus daytime solar energy.
  • Transmission planning is not in sync with the pace of RE (renewable energy) installation.
• Time-Insensitive Tariff Structures: India currently lacks time-of-day (ToD) pricing, discouraging daytime solar consumption.
  • Uniform tariffs provide no incentive for consumers or discoms to shift loads to peak solar hours.
• Land and Regulatory Constraints: Land aggregation issues for large-scale solar or hybrid projects.
  • Delays in regulatory clearances, especially for hybrid renewable systems and storage infrastructure.

Government Initiatives to Improve Clean Energy Utilisation

• Green Energy Corridor (GEC): Aims to strengthen the transmission infrastructure to evacuate renewable energy efficiently from generation points to demand centres.
• PM-KUSUM Scheme: Promotes installation of solar pumps and grid-connected solar power plants in rural areas to reduce diesel usage and support farmers.
• National Green Hydrogen Mission: Seeks to promote the production and use of green hydrogen to reduce reliance on fossil fuels in sectors like refining, steel, and fertilisers.
• Production Linked Incentive (PLI) Scheme: Provides financial incentives for domestic manufacturing of high-efficiency solar photovoltaic (PV) modules and advanced battery storage systems.
• Renewable Energy Hybrid Policy: Encourages setting up of projects that combine solar and wind energy in the same location to increase capacity utilisation and reliability.

Way Ahead

• Grid Modernisation and Smart Management: Invest in smart grids with real-time demand-supply balancing.
  • Enable time-of-day pricing, especially to promote daytime solar usage.
• Battery and Storage Infrastructure: Accelerate deployment of Battery Energy Storage Systems (BESS) through VGF (Viability Gap Funding) or PLI.
  • Hybrid Projects (solar-wind-hydro with BESS) should be fast-tracked.
• Decentralised Renewable Energy: Promote rooftop solar, solar pumps, and mini-grids to relieve base-load pressure.
• Revamp Tariff and Market Design: Introduce differential tariffs for peak vs off-peak periods.
  • Set up green power markets on energy exchanges with open access for industries.
• Nuclear Power as a Strategic Pillar: Nuclear capacity should be scaled in a phased and financially sustainable manner to provide firm, low-carbon base-load power.
  • Advanced reactors and Small Modular Reactors (SMRs) must be prioritised to ensure flexible deployment and enhanced safety.

Source: IE