India Renewable Energy Report Card – FY22

India continues to make great strides in the adoption of renewable energy with reports claiming renewable sources of energy estimated to form a major chunk of India’s energy portfolio in the future. According to reports, India’s renewable energy subsidies more than doubled in FY22. The subsidies reached Rs. 11,500 Cr. in FY22, up from Rs. ~5,700 Cr., a year ago as a result of clear and stable policies, post-COVID demand, and a higher number of installations. Earlier there was a lack of policy certainty and stability. In FY22, the country witnessed solid progress toward the adoption of electric vehicles, the production of green hydrogen, the manufacturing of solar equipment, and the development of energy storage infrastructure.

There were around 28 Central government policies subsidizing renewable energy, for a total amount of Rs 11,50o Cr. This included ~Rs.2,500 grants to IREDA and SECI to increase their visibility in the renewable energy sector. The renewable energy installations in the country also jumped by 155% in the last year. Having said this, India still continues to patronize its fossil-fuel-based generation given the high power demand and the instability of renewable sources of power in the country. Though India allocated 4x more support to fossil fuels when compared to clean energy, the magnitude of the same declined versus that in the prior year (FY21). Subsidies towards coal, gas, and oil sectors fell by more than 75% to Rs. 60,300 Cr. in FY22, since FY14.

Also, read India poised to become a Solar Manufacturing Hub With $2.4B in Aid.

The renewable energy sector is set to grow exponentially in India with the sector expected to attract $25 billion in investments in FY23.  With the oil import scenario disrupted in the wake of the Russia-Ukraine war, countries have got a wake-up call and have started to work on independent energy plans for sustenance and independence. For India as a developing economy, it will be a win-win situation as the country could substantially reduce its import bills and be able to generate ample energy of its own to cater to its growing population needs. The country estimates to achieve 500 GW of clean energy by 2030. It currently has a capacity of 173 GW and ~80 GW under construction. India needs to add 25 GW of renewable energy capacity annually for the next eight years, which would entail an investment of Rs.1,25,000 Cr.