To Become a Renewable Energy Superpower, Our First Lessons Must Come from the North-East

Swaniti Initiative | November 11, 2014 | The Swaniti Blog

Date of Release: November 11th, 2014

Published in: Indian Express

Earlier this month, Piyush Goyal, the Minister of State for Power, Coal and New and Renewable Energy, pledged to make India a “renewable superpower” over the next few years, with a renewed commitment to solar power. India’s Central Governments have long pledged a ‘greener grid’, and undertaken efforts such as the institution of the National Action Plan on Climate Change, commitments to supply electricity to over 300 million citizens by leveraging renewable sources, and the organization of India’s First Global Renewable Energy Investors Summit in early 2015, in an attempt to develop the nation’s renewable energy potential.

However, with all our good intentions and ambitious plans, is India prepared to reduce its dependency on traditional sources of energy? Swaniti Initiative examined our country’s commitment to clean energy by conducting a state-wise analysis of the percentage of total installed electricity capacity based on renewable sources from 2004 to 2012. Renewable energy sources included in this analysis refer to solar, wind, small hydro, biomass, and urban and industrial waste.

ANALYSIS

The state-wise analysis revealed renewable energy sources to account for a much higher percentage of overall state installed capacity in the North Eastern states, with Nagaland (65%), Sikkim (64%), and Arunachal Pradesh (62%) leading the pack. The graph below indicates that in these three states, electricity generated from renewable sources has on average accounted for more than 60% of the overall amount of installed electricity capacity in the state between 2004 and 2012. With a high potential for wind energy and consistent investment over the years, Tamil Nadu (39%) has the fourth highest renewable energy source (RES) percentage in the country. The numbers exclude the Central Sector power capacity based on renewable sources of energy.

TOP 10 states

 

In stark contrast, states like Jharkhand (0%), Odisha (1%), West Bengal (2%), Haryana (2%) and Assam (3%) have a very small share of renewable sources in their energy production mix. Since the eastern States, especially Jharkhand and West Bengal, account for a major share of coal production in India, they account for the major portion of coal cess (charged at Rs 100 per tonne of coal mind) credited to the National Clean Energy Fund (NCEF). The Central Government could use this to create greater renewable energy capacity in these States.

Bottom 5 states

 

Investigating causes

High potential is an obvious reason behind the greater share of renewable energy capacity in some States. The North-East States have high potential for small hydro projects owing to the presence of many rivers and the hilly terrain found in these areas. Similarly, Tamil Nadu has been found to have one of the highest potentials for wind energy in the country. On the other hand, low performing states such as Delhi, Jharkhand, Orissa, West Bengal and Haryana also tend not to have the quality and capacity of wind potential as compared to Tamil Nadu.

However, the low percentage of installed capacity that’s derived from renewable sources cannot only be attributed to natural potential, as many of the low performing states still have high potential for solar energy. This is where the role of effective regulatory environments and private sector participation becomes critical. The Government of Arunachal Pradesh, for instance, instituted the Small Hydropower Policy, which promotes private participation in development of small hydro projects through certain attractive incentives. Similarly, the
Government of Sikkim developed liberalized power policies to facilitate capital investment through public, private or joint sector stakeholders. The Central Government has also supported renewable power generation through special incentives for the North East Region and Sikkim, where a capital grant of ₹22.5 million per MW is available for small hydro projects. Tamil Nadu’s State Government has also long supported PPP models for developing large-scale wind farms and taken steps to invest in the exploration of offshore wind farm options.

The concept of Generation-Based Incentives (GBIs) and Renewable Purchase Obligations (RPOs) adopted by Tamil Nadu needs to be adopted in other parts of the country as well. Cities like Pune have taken the lead in developing waste-to-energy projects in PPP mode between private players and the city municipal corporation.

Finally, a quick and transparent land acquisition process is also critical, where states such as Jharkhand, Odisha and West Bengal have traditionally lagged behind other States in the country. As India looks to become the next ‘renewables superpower’ it will need to look to states in the North East and Tamil Nadu as models for innovation, implementation, and commitment to achieving a greener grid. The 3Ps approach as illustrated below is the way forward. After all, renewable energy is a remedy to multiple problems – it can augment existing power capacity, encourage local manufacturing, control emission levels, and finally, support waste management, which will be an important part of the Swachh Bharat campaign.