Renewable Opportunities: Scope of Renewable Energy in India for Jobs & Entrepreneurship (Episode 1)

Author: Dr. Rupak Banerjee

Fortune estimates that new jobs in solar and wind power have been growing 12 times faster than average new job creation in the US. Similar trends are expected in China and India as jobs in renewable energy pick up. In a series of blog posts, I intend on exploring the opportunities that the low carbon economy will bring to India, and dig deeper into the impact of climate change and climate action on the Indian economy and its young job seekers.

India, with a population of 1.3 billion and counting, is the second most populous country in the world. Even with a meager 1.7 metric ton of Carbon Dioxide emission per year per capita, the sheer size of the population makes it the third largest carbon emitter in the world (epa.gov) contributing 7% of the global emissions. 

India signed the Paris accord in 2015 and with a pledge to cut its greenhouse gas (GHG) emissions intensity by 33 – 35% by the year 2030 in comparison to its GHG emissions of 2005. This is a very ambitious plan considering that India still has over 200 million people (1/6th of the population) living without reliable access to electricity (Source: www.nrdc.org). With an economy projected to grow at 6 – 7% annually, India’s quest for energy is not likely to slow down.

India is the seventh largest economy by nominal GDP while it ranks at 141st in nominal GDP per capita. With the economy growing and more people emerging from poverty, the expectations of lifestyle and standard of living will continue to march on. An improved lifestyle and higher standard of living result in higher consumption of electrical power, greater reliance on transportation which all lead to increase in GHG emissions. As China grew its GDP through the 1990s – 2010s, its GHG emissions grew threefold (see figure). Similar changes have been seen through post-industrialization history with most countries.

As India’s economy and GDP grow, similar growth in Carbon Dioxide emissions are expected. This is what makes the Indian pledge to the Paris climate accord so important. In a future post, I will discuss why it is so important for India to pledge big against climate change. For now, it is interesting to note that Climate Action Tracker  rates India’s pledge and strategy among the few countries who are on track for limiting the global warming to a maximum of 2°C.

Step two, we need to understand the scale of the problem. India had a total installed capacity of 1.3 GW of electrical power generation in 1947 at the time of independence. In the past 70 years, it has grown by 250 times to reach a total installed capacity of 326.8 GW. To put this in perspective, the United States currently has an installed capacity of 1064 GW while China has over 1500 GW, and continues to grow. India’s capacity is definitely going to increase as more villages are electrified, more people purchase more electrical appliances and the quality of life increases. The Government of India’s (GoI) Ministry of Power reports that of the 326 GW of electrical power being generated in India, 17.7% comes from renewable sources, with an additional 13.6% from hydroelectric and 2.1% from nuclear. That amounts to over 30% of the electricity generation is already free of carbon emissions.

Let’s switch gears. Now that we know what the pledge is for the Paris accord, let us evaluate what strategy India is pursuing. First, let us look at the wording of the pledge. India has pledged to cut its greenhouse gas (GHG) emissions intensity by 33 – 35% by the year 2030 in comparison to its GHG emissions of 2005. The keyword is intensity. The emissions are not going to be going down by 2030, but the rate of change will be slower. The graph shows makes it easier to understand.

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The second part of the pledge is to achieve 40% cumulative electrical power capacity from non-fossil fuel sources. We are already over the 30% mark for non-fossil fuel sourced electrical generation, but it will become more challenging as India’s thirst for power grows and more capacity is added. The easiest and most reliable capacity addition is through thermal power plants (either fossil fuel or nuclear) as renewable energy can be intermittent and requires equivalent backup in the form of fossil fuel powered plants. As India continues on its path to add more capacity it will be important to add significantly more solar and wind along with nuclear to offset any new thermal power plants coming online.

In line with its pledge for the Paris accord, India has set a target of achieving 100 GW of installed capacity from solar by the year 2022. As of September 2016, India’s installed solar capacity stood at 8 GW. That gives India 6 years to add 92 GW of solar capacity. We are already another 1 year in, leaving 5 more years to achieve the target. Imagine what this means for companies investing in solar power in India and the potential for jobs as more installations come online.

In the next post, I will explore the new jobs that are being created as part of the renewable energy revolution that is currently ready to boom. In the meanwhile, write to me if you have suggestions or if I missed something, or just if you want to say hi. And if you want to read some more about climate action, here are two interesting books to chew on:

  1. What We Think About When We (Try Not to) Think About Global Warming: Toward a New Psychology of Climate Action By Per Espen Stoknes
  2. Local Climate Action Planning By Micheal R. Boswell, Adrienne I. Greve and Tammy L. Seale