Renewable energy gains further traction in India

India's electricity generation capacity from renewable sources in 2019 rose 16pc from 2018, led by growth in solar power, as the country tries to reduce its dependence on thermal coal.

Installed generation capacity from renewable energy sources such as wind, solar and bio-power rose to 85.91GW from 74.08GW in 2018, according to the latest data from the Central Electricity Authority, a division of India's power ministry. Coal-based generation capacity grew just 0.5pc in 2019 to 198.49GW and the country remains heavily reliant on thermal coal for its power needs.

Thermal power generation capacity — which includes coal, natural gas, lignite and diesel-fired power plants — is projected to make up 50pc of the total installed power generation mix by March 2025, according to a government panel. Thermal power currently accounts for 62.5pc of India's installed capacity, which is dominated by coal.

India's renewable generation capacity was at just 15.23GW by the end of 2009, underscoring New Delhi's effort to ramp up electricity generation from cleaner sources of energy in the last decade and to cut coal-related emissions.

The country aims to hit 175GW of generation capability from renewable sources by 2022, according to the Ministry of New and Renewable Energy. This would entail having 100GW capacity from solar sources by 2022, up from the current 33.73GW. It also aims to lift wind capacity to 60GW by 2022, up from 37.51GW at present.

This is part of broader plans to have at least 40pc of its generation capacity to be based on renewable sources of energy by 2030, the ministry said, from the current 23pc.

Coal domination

Coal remains key to India's electricity needs, accounting for more than half of its installed power capacity. The government is finalising plans to auction coal blocks for commercial mining to boost local production. This comes despite a broader goal to increase investment in cleaner energy sources and to cut reliance on coal.

Imports of thermal coal also surged in 2019 amid a local shortfall as extended rainfall affected output at state-owned Coal India (CIL), which meets more than 80pc of India's coal needs. CIL raised its output in December following five consecutive monthly falls.

Indian thermal coal imports in December grew by 1.4mn t from a year earlier to 15.5mn t, according to data from shipping agency GAC. This meant that seaborne imports for 2019 grew by 14.4mn t to 185.5mn t, despite the government's emphasis on raising renewable generation. Although imports rose overall, the rate of growth slowed from a year earlier because of India's economic slowdown.

By Saurabh Chaturvedi