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India's Energy Transition: Balancing Coal & Renewables

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India's economic growth trajectory is deeply intertwined with its energy policies. As the Economic Survey 2024-25 highlights, ensuring sustained growth while transitioning towards a low-carbon economy is a challenging yet essential goal. However, the debate over phasing out coal remains complex, given the country's energy security needs, industrial demands, and employment concerns.

The survey warns against the premature shutdown of coal-fired power plants without viable alternatives. It emphasizes that while transitioning to renewable energy (RE) is necessary, it must be gradual, strategic, and aligned with national economic priorities. The contrasting policies of developed nations also raise concerns regarding climate hypocrisy, making India's energy strategy a crucial subject for discussion.

 

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Table of Contents

  1. Introduction

  2. India’s Energy Landscape

  3. The Role of Coal in India's Economy

  4. Renewable Energy: Potential & Challenges

  5. Global Energy Transition & Climate Hypocrisy

  6. Government Policies & Commitments

  7. Global Initiatives on Energy Transition

  8. Challenges in India's Energy Transition

  9.  Solutions

  10. Conclusion

 

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1. Introduction

India’s energy needs are growing rapidly as the country moves towards a $5 trillion economy. With over 1.4 billion people, energy security is a major policy priority. The reliance on coal has historically supported economic growth, but the environmental cost of carbon emissions necessitates a transition to clean energy.

 

The Economic Survey 2024-25 highlights three critical aspects:

  1. Energy security and economic growth: Coal remains indispensable in India's power mix.

  2. Global energy transition & hypocrisy: Developed nations continue their fossil fuel reliance while pushing developing countries towards costly renewables.

  3. Challenges in renewable adoption: Infrastructure gaps, high costs, and energy storage issues hinder large-scale transition.

 

 
2. India’s Energy Landscape
 
Current Energy Mix-

 

Energy Source Share in Total Power Generation
Coal ~55%
Renewable Energy (Solar, Wind, Hydro, Bioenergy) ~30%
Hydro ~11%
Nuclear ~4%
Others ~1%

 

Despite ambitious renewable energy targets, coal remains the backbone of India’s power sector. The country aims to install 500 GW of non-fossil fuel capacity by 2030, but bridging the gap requires significant investment and infrastructure development.

 

3. The Role of Coal in India's Economy
 
Employment & Industrial Dependence-

  • Coal mining directly employs over 3.5 lakh workers and supports millions indirectly in transport and ancillary industries.

  • Industries such as steel, cement, and manufacturing depend heavily on coal for energy and raw materials.

 
Infrastructure Investments-

  • India has invested billions in coal-based power plants and transmission infrastructure. A sudden phase-out would lead to stranded assets and financial stress in the energy sector.

  • Unlike developed nations with nuclear and LNG alternatives, India cannot afford sudden coal abandonment.

 
Energy Security Considerations-

  • Coal-based power ensures stable electricity amid fluctuations in solar and wind generation.

  • India lacks large-scale energy storage solutions to replace coal’s base-load stability.

 

4. Renewable Energy: Potential & Challenges
 
Solar & Wind Power Expansion-

  • India has installed over 150 GW of renewable capacity, with ambitious plans for 500 GW by 2030.

  • Technological advancements are making solar and wind energy more efficient, but intermittent supply remains an issue.

 
Grid Infrastructure & Storage Gaps-

  • Smart grids and energy storage solutions are critical for managing variable renewable energy.

  • Large-scale battery storage projects and hydrogen energy storage are in early development phases.

 
Economic & Cost Considerations-

  • Higher initial investment for renewable energy infrastructure.

  • Cheaper financing options and government subsidies can accelerate adoption.

 

5. Global Energy Transition & Climate Hypocrisy
 
Policy Actions of Developed Nations-

  • The US and EU continue fossil fuel investments despite net-zero pledges.

  • France expanded nuclear power post-1970s oil embargo while pressuring developing nations to abandon fossil fuels.

 
Contradictions in Climate Commitments-

  • Developed countries benefited from carbon-intensive growth but demand that developing nations take on greater responsibilities.

 
Equity in Climate Finance & Technology Transfers-

  • India demands fair access to climate finance and technology to ensure an equitable transition.

 

6. Government Policies & Commitments
 
National Energy Transition Framework-

  • Targets 500 GW non-fossil fuel capacity by 2030.

 
Net Zero by 2070: Strategy & Challenges-

  • Carbon Capture & Storage (CCS) and clean coal technologies.

  • Expansion of nuclear and hydro power.

 
India’s Push for Global Climate Justice-

  • Advocating for $100 billion in climate finance.

 

7. Global Initiatives on Energy Transition
 
Paris Agreement & COP Meetings-

  • The Paris Agreement (2015) set global emission reduction targets with India committing to achieve net-zero emissions by 2070.

  • COP27 and COP28 emphasized climate finance for developing nations and technological collaborations.

 
International Solar Alliance (ISA)-

  • India launched ISA in 2015 with France to promote solar energy globally.

  • Over 100 countries are part of ISA, working towards reducing solar energy costs and improving accessibility.

 
Mission Innovation & Clean Energy Partnerships-

  • Initiated during COP21, this global initiative encourages clean energy R&D and collaborative investments.

  • India actively participates in bio-energy, smart grids, and sustainable fuels research.

 
G20 & Global South Collaboration-

  • The G20 Energy Transitions Working Group prioritizes clean energy financing and equitable access to technology.

  • India advocates for a Global South-focused green development model, ensuring fairness in climate action.

 

8. Challenges in India's Energy Transition

India’s energy transition is fraught with multiple challenges that require strategic intervention and careful planning. The following are key obstacles that hinder the shift from coal to renewable energy sources:

 
1. Strengthening Energy Security-
  • Coal still accounts for over 55% of India's power generation, ensuring base-load stability.
  • Over-reliance on imported solar and wind technology increases external dependence.
  • Intermittent nature of renewables raises concerns over consistent power supply, particularly during monsoon and winter seasons.
 
2. Scaling Renewable Integration-
  • India aims for 500 GW of non-fossil fuel capacity by 2030, but integrating renewables into the national grid remains a challenge.
  • A lack of smart grid infrastructure and efficient transmission systems leads to high transmission losses.
  • Limited manufacturing capacity of solar panels, wind turbines, and battery storage systems delays adoption.
 
3. Nuclear Energy as a Clean Alternative-
  • Nuclear power contributes only ~4% to the energy mix, far below its potential.
  • Setting up new nuclear reactors faces public resistance due to safety concerns and land acquisition issues.
  • Dependence on imported uranium poses risks to long-term sustainability.

 

4. Hydrogen Energy for Long-Term Sustainability-
  • Green Hydrogen is seen as a future energy carrier, but production costs remain prohibitively high.
  • Lack of domestic electrolyzer manufacturing capacity slows down adoption.
  • Transporting and storing hydrogen requires advanced infrastructure, which is currently absent.

 

5. Addressing Grid Infrastructure & Storage Gaps-
  • Energy storage solutions (battery and pumped hydro storage) are essential to manage variable renewable power but are currently underdeveloped.
  • Grid modernization requires huge capital investments, which many discoms (power distribution companies) struggle to afford.
  • Lack of demand-side management systems results in inefficient power consumption.

 

6. Managing High Transition Costs-
  • Initial investment in solar, wind, nuclear, and hydrogen energy is significantly higher than coal.
  • High-interest rates on green energy projects in India make renewable investments less attractive compared to global standards.
  • Developing carbon capture and storage (CCS) technology is expensive and requires global funding.

 

7. Ensuring Socio-Economic Equity & Just Transition-
  • Millions of coal-dependent workers risk losing jobs due to the energy transition.
  • Unequal regional distribution of renewable energy projects creates economic disparity.
  • Rural areas dependent on coal mining lack alternative employment opportunities.

 

8. Enhancing Global Climate Cooperation-
  • Developed nations push for rapid transition while continuing their reliance on fossil fuels.
  • India's demand for climate finance and technology transfer faces bureaucratic and diplomatic hurdles.
  • Paris Agreement funding commitments from developed nations remain largely unfulfilled.

Each of these challenges underscores the need for a balanced, pragmatic approach to India’s energy transition, ensuring sustainability, economic stability, and energy security. Let me know if you need further refinements!

 

9. Way Forward: Balancing Growth & Sustainability

 

1. Strengthening Energy Security-

  • Gradual coal phase-out with a clear transition roadmap.

  • Investment in clean coal technologies like Carbon Capture & Storage (CCS) to reduce emissions while utilizing existing plants.

  • Expansion of nuclear and hydro energy for base-load stability.

 

2. Scaling Renewable Integration-

  • Grid modernization & battery storage investment to support fluctuating renewable sources.

  • Boosting domestic production of critical minerals (lithium, cobalt) to reduce import dependence.

  • Enhancing R&D in green hydrogen & alternative fuels.

 

3. Nuclear Energy as a Clean Alternative-

  • Nuclear power provides a reliable, low-emission energy source.

  • India's current nuclear capacity is ~7 GW, with plans to reach 22 GW by 2030.

  • Fast Breeder Reactors (FBRs) and Thorium-based reactors are being developed to utilize India's large thorium reserves.

 

4. Hydrogen Energy for Long-Term Sustainability-

  • Green Hydrogen Mission (2022) aims to make India a global hub for hydrogen production.

  • Hydrogen can decarbonize heavy industries, transport, and power generation.

  • India is investing in electrolyzer production and hydrogen fuel cell technology.

 

5. Ensuring a Just Energy Transition-

  • Reskilling coal workers for employment in the renewable energy sector.

  • Ensuring affordable electricity for industries and households during the transition.

  • Strengthening public-private partnerships to accelerate clean energy deployment.

 

10. Conclusion

India’s energy transition must balance sustainability with economic security. Prematurely shutting coal plants without robust alternatives could jeopardize industrial growth, employment, and energy access.

A well-planned, gradual shift towards clean energy—backed by technological innovation and policy incentives—is crucial for achieving net-zero by 2070 without compromising energy security. The world must recognize India's unique developmental needs and support its transition through equitable climate finance and technology sharing.

India stands at a crucial juncture. The choices made today will shape its economic and environmental future for decades to come.

 

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