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The green energy sector can provide an impetus for India and the UK to collaborate more closely. India's electricity demand is expected to triple from 800 terawatt hours (Wh) to 2,400 TWh by 2030. Meeting this demand sustainably is a formidable task. India's per capita power consumption is around one-fourth of China's and is one of the lowest per capita emitter of CO2 in the world but it is also the third-largest CO2 emitter in the world with 76 per cent of its electricity generation from fossil fuels. For India to meet is economic and human development goals, its per capita energy and electricity consumption has to increase while keeping the CO2 per capita in check. In its Intended Nationally Determined Contributions (INDC) submitted ahead of the Conference of the Parties (COP) 21, India committed itself to source 40 per cent of its installed electric power supply from non-fossil fuel based energy sources by 2030 and 33-35 per cent reduction in carbon intensity of its GDP from 2005 levels. Planning for India's energy requirement is based on energy security, affordability and sustainability. The UK also has a 'Clean Growth Strategy' to decarbonise its economy. Currently 26 per cent of the UK's energy generation of 330 TWh is from renewables and is a leader in offshore wind power generation. Going forward apart from offshore wind UK also plans to focus on other “less established” green technologies such as tidal waves with plans to invest £2.5 billion in research and development of such technologies. The UK also continues to invest in development of technology for smart grids, energy efficiency and battery storage. The UK is currently working on a massive programme of installing smart meters in every home by 2020. If India has to supply power to all through clean energy sources, then India's discoms and grid operators also have to cut their losses and improve performance. The size of India's power transmission and distribution grid is around 340 GW (expected to go up to 600 GW by 2025) compared to the UK's of around 85 GW. India can provide huge market opportunities for such digital and smart technologies across generation, transmission, distribution and storage. As India's installed RE capacity increases, RE integration will become a challenge without the adoption of battery storage solutions. The UK is among the top storage markets in the world and its storage capacity is expected to dramatically increase in the next few years. Another area where India and the UK can work together is energy access. Around 240 million Indians (around 18 per cent) are still without access to electricity. Microgrids can provide accelerated access to electric power to these people, doing away with the need to wait for centralised grid. One of the oft-repeated issues with microgrids is the risk to the microgrid operator of customer shift once they are eventually connected to national grid. However, technology-driven solutions to such problems are possible for eg, with the use of blockchain, it might become possible to have separate billing for grid and microgrid operators. The application of microgrids is not just for remote areas, even urban areas face issues pertaining to high demand load, grid stability and resilience. Microgrids can combine power from variety of generation sources to provide reliable, economic and green power and island itself when needed to protect itself from central grid issues. Collaboration between the UK and India on research and innovation for each of the above technologies and their adoption along with new business models would reap rich dividends for both countries, as such joint programmes benefit both manufacturers and users of technology. On the other hand, India is one of the least-cost renewable energy producers in the world, with power costs declining to less than 4 cents/kwh. India's expertise in producing low-cost power can be leveraged by the UK as it seeks to grow its onshore wind and solar power without subsidy. The potential is huge. According to some reports, a further £20 billion of investment in the UK till 2030 in onshore wind and solar PV can be unlocked if the tariffs are low enough. Access to low-cost funding is critical to India realising its RE ambitions. According to some estimates India needs at least $125 billion funding to meet its targets for RE deployment. The UK has access to a large pool of investors who are extremely keen on renewables and can facilitate India's access to such investors through instruments such as Green Masala Bonds on the London Stock Exchange. Britain's institutions and companies can also invest in renewables as the Indian business environment continues to improve. The UK can take the lead in various multi-lateral funds as the largest investor to pool in global investments into India's energy sector. The UK and India have historically had a strong economic relationship. India invests more in the UK than anywhere in Europe. The UK is the largest G20 investor in India for the last 15 years. The two countries have traditionally partnered in areas of research and development. Just like the mobile phone revolution leap-frogged fixed line telephony in India, distributed power generation is all set to take a similar giant leap to electrify the houses of those without access to electricity. As India grows and develops its grid connected and distributed power infrastructure combined with battery storage, the per capita consumption of electricity will go up. Increasing prosperity will also drive people to buy more electric appliances, gadgets etc. But the upward trend of per capita consumption should progressively become more and more gradual till it plateaus or even reverses as energy efficient technologies catch up. Collaboration between countries, especially in clean technology innovation, is essential for pooling in resources for R&D, prototyping, demonstration and faster deployment. Clean technology is going to dominate the innovation scenario for years to come and has the potential to re-energise the India-UK partnership for a greener future.
Rahul Munjal is Chairman and Managing Director of Hero Future Energies.