India's Massive Renewable Energy Opportunity Being Squandered

Solar power's potential in India is off the charts -- a thousand times greater than the likely electricity demand in the sun-blessed nation by 2015.

Wind could produce a whopping 65,000 megawatts -- about half of India's present total installed capacity. And the potential of available biomass, energy from plants, is 30,000 megawatts -- ten times the nation's current nuclear capacity.

But there's a problem of mismanagement at India's Ministry of New and Renewable Energy that's crippling clean energy development, according to a new report from the London-based Commonwealth Business Council (CBC) and the Indian Institute of Management (IIM).

And the result is that vital clean technology dollars are going elsewhere.

The Indo-Asian News Service sums it up:

From poor research and development (R&D) to non-existent basic data and non-functioning projects, the Indian renewables industry is dogged by a catalogue of mismanagement and errors that are stopping vital private investments in the sector.

The numbers support this claim.

According to a January 2009 report by the Cleantech Group, Indian cleantech companies raised $277 million in 2008 -- a drop of 20 percent from 2007.

True, investment in the sector saw an overall decline last year. But not in China, a competitor for India, which saw a 22 percent increase in cleantech financing in 2008. China snatched up five percent of the global total, while India accounted for three percent.

Here are some of the most blatant bureaucratic barriers to renewables growth on the subcontinent, from the CBC-IIM study:

The solar sector is hamstrung by acute land scarcity. In rural India, proposed solar plants are losing out to competing infrastructure projects also in need of land.

The wind sector suffers from a lack of real data on where the windiest parts of India actually exist. Out of the 553 wind-monitoring stations that are installed, only 53 are operational.

The biomass market is "completely unstructured." There is no formal way of meeting demands or checking the quality of products. Poor local data on waste makes it difficult for companies to decide what type of waste-power plants to design.

This isn't to say there hasn't been progress in developing clean energy sources.  India's ministry for renewable energy development remains the only one of its kind in the world -- even if it is a tangle of "green" tape.

And the nation's wind energy capacity shot up significantly in recent years. In 2007, new wind capacity jumped 29 percent in India, according to the Global Wind Energy Council. In 2008, it rose another 23 percent.

And take a look at these developments. They should bode well for the future:

• The government has mandated that 12 percent of all electricity come from renewable sources by the year 2010.
• The nation's National Climate Change Action Plan of June 2008 called for a "National Solar Mission," with a goal of deploying 1,000 megawatts of solar thermal power generation and increasing the production of photovoltaic to 1,000 megawatts per year.
• The Rajasthan government has set aside a 13,500 m² area of the Thar desert for solar power, sufficient to generating a minimum of 700,000 megawatts. 

Still, non-hydro renewables remain marginal players in India's great energy game, making up around eight percent of grid capacity -- a pittance of its total installed capacity of 146,000 megawatts.

And as far as wind goes, China overtook India by a huge margin in 2008 for the first time, in terms of both new capacity and total installed capacity.