Renewable energy investments to surge 83 pc to USD 16.5 billion in 2024 – EQ

In Short : Renewable energy investments are projected to surge by 83%, reaching USD 16.5 billion in 2024. This substantial increase signifies growing global commitment and financial support for clean energy initiatives, highlighting the sector’s expanding significance.

In Detail : India will witness more than 83 percent increase in investments in renewable energy projects to around USD 16.5 billion in 2024, as the country focuses on the energy transition to reduce carbon emissions, energy ministry estimates show. This is in line with India’s ambitious target of 500 GW of renewable energy by 2030 and its resolve to reduce overall fossil fuel power generation capacity to less than 50 percent. India has committed a net zero emission target by 2070.

However, Energy and New and Renewable Energy Minister R. K. Singh has said on many occasions that up to 65 percent power generation capacity would be from non-fossil fuels by 2030, that would be higher than the set target of 50 percent.

In an interview with PTI, Singh said, “India is likely to see the addition of 25 GW of renewable energy capacity, including an investment of Rs 1,37,500 crore (about USD 16.5 billion) in calendar year 2024, which would be higher than 13.5 GW with an investment of Rs 74,250 crore (nearly USD 9 billion) seen in 2023.”

Apart from solar and wind power, India has significantly increased its focus on green hydrogen to reduce dependence on fossil fuels, mainly diesel, required for long-haul vehicles.

India’s economy is diesel-driven, so most commercial vehicles for passenger and freight services use diesel as the fuel.

In January this year, the Union Cabinet approved the National Green Hydrogen Mission with an outlay of Rs 19,744 crore.

Later in July, the Solar Energy Corporation of India (SECI) called bids for providing incentives for the production of 4,50,000 tonnes of green hydrogen and 1.5 GW of electrolyser manufacturing facilities annually.

21 firms have bid for incentives for electrolyser manufacturing of 3.4 GW and 14 companies for green hydrogen production of 5,53,730 tonnes under the Strategic Interventions Plan for Green Hydrogen Transition (SIGHT) (Mode-1- Tranche-I).

Reliance Electrolyser Manufacturing, Adani New Industries, L&T Electrolysers, and Bharat Heavy Electricals are among the 21 companies that have bid for government incentives to set up an annual capacity of 3.4 GW for manufacturing electrolysers.

Other companies that have bid were Hild Electric Private, Ohmium Operations, John Cockerill Greenko Hydrogen Solutions, Waaree Energies, Jindal India, Avaada Electrolyser, Green H2 Network India, Advait Infratech, ACME Cleantech Solutions and Oriana Power.

Matrix Gas and Renewables, HHP Seven, HomiHydrogen, Newtrace, C. Doctor & Company, Pratishna Engineers, and LiveHy Energy also participated in the bidding.

The 14 companies that evinced interest in incentives to set up green hydrogen production facilities were ACME Cleantech Solutions, Torrent Power, UPL, GH4INDIA, Aneeka Universal, Sembcorp Green Hydrogen India, Greenko ZeroC and CESC Projects.

Others were JSW Neo Energy, Welspun New Energy, Avaada GreenH2, Reliance Green Hydrogen and Green Chemicals, HHP Two, and Bharat Petroleum Corporation.

The National Green Hydrogen Mission aims to make India a global manufacturing hub for this clean energy source and is expected to lead to the development of 5 million metric tons per annum of green hydrogen production capacity by 2030.

The mission provides for the setting up of two green hydrogen hubs in the initial phase.

The Ministry of Ports, Shipping and Waterways has identified three major ports – Deendayal, Paradip and V.O. Chidambaranar (Tuticorin) Ports- to be developed as hydrogen hubs.

Singh said India has 7.8 million tonnes of green hydrogen capacity at different stages.

The Strategic Interventions Plan for Green Hydrogen Transition (SIGHT), supported by Rs 17,490 crore, will help catalyze the production of green hydrogen and electrolyzers, develop the green hydrogen ecosystem, and enable industrial decarbonization.

India’s dedication to environmental sustainability is in line with the global shift towards green hydrogen and its derivatives, said Vineet Mittal, Chairman of CII’s Taskforce on Green Hydrogen and Co-Chair of CII’s Renewable Energy Council.

“However, meeting additional demand for renewable energy and establishing a robust ecosystem for green hydrogen and green ammonia will be pivotal in 2024.”

Leveraging the renewable energy potential, India can emerge as a production hub to meet the escalating demand for green hydrogen derivatives, said Mittal, who is also Chairman of Avaada Group.

Observing that the outlook for renewable energy in 2024 is positive, Rahul Munjal, Co-Chairman of CII Renewable Energy Council, said there is an expectation of continued investment and technological advancements, particularly in the areas of renewable energy and battery storage.

Munjal is also the Chairman and Managing Director of Hero Future Energies.

The comprehensive vision outlined in the Central Electricity Authority’s report on the optimal generation mix for the year 2030 targets the production of 292 gigawatts of solar energy, 100 gigawatts of wind energy, and 18 gigawatts of hydroelectric energy, which provides great opportunities for various investments in this sector.

“To achieve the goal of 292 GW of solar installations and 100 GW of wind energy installations by 2030, Renewable Energy Implementation Agencies (REIAs) must invite large-scale bidding (up to 5 GW) to maximize the implementation capabilities of developers,” Shekhar Dutt, Director General of Solar Power Developers Association (SPDA), said.

He also pitched for mandating Green Hydrogen Consumption Obligations (GHCOs) for key industrial sectors to promote the use of green hydrogen.

Installed renewable energy capacity, excluding large hydropower plants, in India is expected to rise to about 170 GW by March 2025 from a level of 132 GW, said Girishkumar Kadam, senior vice president & Co-Group Head – Corporate ratings at ICRA

Moreover, he said more capacity addition thereafter is likely to be supported by the significant improvement in tendering activity in the current fiscal, with more than 16 GW of projects tendered so far and another 17 GW under implementation by central nodal agencies.

He added that this is in line with the 50 GW annual bidding trajectory announced by the government in March 2023.