Climate action: India Inc needs a clear road map for our green transition
On the positive side, India’s aggressive push for renewable power has resulted in renewable electricity costs becoming competitive with grid power, although India still has to make round-the-clock (RTC) power competitive. A differential market approach—with high paying customers such as industry and the commercial sector being targeted as beneficiaries of RTC power—can help move the needle quicker, giving a further boost to renewable power. The residential and agricultural sectors can possibly help deal with the intermittency of renewable power better through well-designed demand-response programmes, leading to more efficient consumption and a possible push for stand-alone renewable power.
In addition to preparing the manufacturing/supply sectors for a low-carbon future, aggressive targets adopted by the government are also helping electricity markets mature and the country build capacities in related institutions, such as regulatory commissions. A case in point is the evolution of green tariffs, with the Joint Electricity Regulatory Commission recently proposing an incremental tariff for Chandigarh. Green tariffs have been in India for nearly 15 years, but with limited uptake.
India’s early action on green hydrogen and electric vehicles (EVs) also holds promise in helping these sectors evolve in line with strategic national interests. The EV programme, albeit with substantial subsidies, has resulted in about 5% of total vehicles sales between October 2022 and September 2023 being electric. This is expected to increase eight-fold to 40% by 2030 as a number of identified barriers are addressed.
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