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.

Most disappointing is that solar power accounts for a measly 0.5 percent of India's total installed renewable energy.

To boost that percentage will take far more than ending bureaucratic inefficiencies.

It's going to take a home-grown revolution in cost and technology to make clean sources as cheap as coal. Think Tata Nano, but for solar installations not cars. That will take time.

For now, India needs consistent climate policies from the national government, at the very least, with hard targets and guidelines, not the big vision rhetoric we have seen to date. That could help lure private investment in the near term.

Interestingly, the nation seems to be making progress on that front.

India's in the midst of elections. And for the first time in its election history, the manifestos of the two leading major parties -- The Indian National Congress (INC), head of the current ruling coalition, and the Bharatiya Janata Party (BJP) -- have devoted space to climate change and renewable energy. (hat tip: Worldwatch Institute).

You can read them for yourself here. Here's a taste:

The BJP proposes to invest heavily in developing non-fossil fuel-based clean energy sources, especially for electricity production. Our goal will be to add at least 120,000 MW of power over the next five years, with 20 per cent of it coming from renewable sources.

-- BJP Manifesto 

The Congress-led UPA government has already unveiled a National Action Plan for Climate Change. It is an acknowledgment of our responsibility to take credible actions within the overall framework of meeting the development aspirations of our people for higher economic growth and a higher standard of living. This action
plan will be implemented in letter and spirit.

-- INC Manifesto (pdf)

There's still a scarcity of real targets and goals, and you won't find dollar commitments, à la President Obama's $150 billion clean energy pledge. But it's no less a highly positive development. 

And notably it's coming from voters. Said Surya Sethi, principal energy adviser for India's
Planning Commission, to the Worldwatch Institute:

"The manifestos of the political parties merely reflect what the party perceives as key concerns of its voters...The growing middle class, with its greater reach to media and other sources of information, simply demands more and better attention to such concerns."

India's leaders would be wise to listen to its citizens -- through policy action not platitudes.

Wealth and job creation hang in the balance. As Dr. R.K. Pachauri, head of the UN IPCCC said of India's massive renewables opportunity:

"With the developed world unwilling to give up the short term benefits accruing from the use of coal, India can emerge a major leader as far as new technology is concerned, besides also emerging a leader in combating climate change."

 

See also:

Energy [R]evolution: A Sustainable India Energy Outlook, a blueprint for curbing carbon emissions while ensuring economic development and growth (Greenpeace, March 2009)

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