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Monday, 7 September 2020

Renewable energy policy and electricity market

An ambitious target of 175 GW installed capacity of renewable energy sources by 2022 has been put forth by the Government of India. It is imperative that a sustainable regulatory and commercial framework is put in place to facilitate forecasting, scheduling, imbalance handling and settlement framework of renewables. This will enable electricity market access to renewables at both intra-state and inter-state level. Flexibility of the conventional generation fleet needs to be tapped for balancing the intermittency and variability associated with renewables especially wind and solar generation. This paper presents the existing legal & regulatory framework, challenges and way forward for RE integration in India.

 Indian citizens have access to electricity and clean cooking has been at the top of the country’s political agenda. The government of India has also made significant progress in reducing the use of traditional biomass in cooking, the chief cause of indoor air pollution that particularly affects women and children. The government has encouraged clean cooking with liquefied petroleum gas. India continues to promote cleaner cooking and off-grid electrification solutions, including a shift toward using solar photovoltaics (PV) for cooking and charging batteries.

India’s electricity security has improved markedly through the creation of a single national power system and major investments in thermal and renewable capacity. India’s power system is currently experiencing a major shift to higher shares of variable renewable energy, which is making system integration and flexibility priority issues. The Government of India has supported greater interconnections across the country and now requires the existing coal fleet to operate more flexibly. It is also promoting affordable battery storage.

Based on current policies, India’s energy demand could double by 2040, with electricity demand potentially tripling as a result of increased appliance ownership and cooling needs. Without significant improvements in energy efficiency, India will need to add massive amounts of power generation capacity to meet demand from the 1 billion airconditioning units the country is expected to have by 2050. By raising the level of its energy efficiency ambition, India could save some USD 190 billion per year in energy imports by 2040 and avoid electricity generation of 875 terawatt hours per year, almost half of India's current annual power generation. 

India’s innovation-specific policy support have been important in driving energy technology development. As part of its climate policy agenda, the government has pursued a missionbased approach in many policy areas, including solar, water and energy. India has also been a leader in Mission Innovation and other multilateral collaborations, including the IEA Technology Collaboration Programmes. Recent years have shown a marked increase in clean energy RD&D funding, especially as India works to double its spending over five years under Mission Innovation. However, funding efforts are spread both thinly and widely across the government and its public sector companies. 

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