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Coal share in India’s electricity mix drops below 50% for first time since 1966

InduQin

The report highlights that India's declining reliance on coal as a power source reflects a broader global trend. According to a joint press release from IEEFA, JMK Research & Analytics, and Ember (an energy think tank), the demand for coal in G7 countries has plummeted to record lows in 2023, reaching levels not seen since the early 1900s.



The latest data from the Institute for Energy Economics and Financial Analysis (IEEFA) reveals a significant shift in India's power generation landscape. The report shows that the share of coal in the country's total power capacity has dropped below 50 percent for the first time since 1966, while renewable energy sources have accounted for an impressive 71.5 percent of the record 13,669 megawatts (MW) of power generation capacity added during the January-March period.


According to the IEEFA's latest POWERup quarterly report, this achievement far exceeds the Indian government's target of establishing 50 percent cumulative power generation capacity from non-fossil fuel-based sources by 2030. This trend reflects a global movement away from coal, as evidenced by the plummeting demand for the fossil fuel in G7 countries, which has reached levels not seen since 1900.

 

The report also highlights the growing interest in large-scale renewable energy projects in India, with tender issuances crossing a record 69 gigawatts (GW), surpassing the government's seemingly ambitious target of 50GW for the fiscal year 2024. This rebound follows a slump from 2019 to 2022 due to supply-chain issues and global price spikes caused by the COVID-19 pandemic and Russia's invasion of Ukraine.


Vibhuti Garg, the Director – South Asia at IEEFA, attributes the strong investor interest in the Indian utility-scale renewable energy market to the large-scale potential for growth, the central government's support in terms of targets and regulatory frameworks, and the higher operating margins.

 

Furthermore, the report highlights India's impressive performance in the global solar power generation rankings, with the country now ranking third, behind only China and the US. Solar was the world's fastest-growing electricity source for the 19th straight year, adding more than twice as much new electricity as coal in 2023.


However, the report also notes that India has been unable to completely break free from its dependence on coal, which continues to account for over 70 percent of the country's electricity generation. Adverse weather conditions and surging power demand have contributed to this reliance, and the Central Electricity Authority expects a shortfall in hydropower, leading to potential power shortages, especially during the night when solar is offline.


Overall, the report paints a nuanced picture of India's energy transition, with significant progress in renewable energy but a lingering dependence on coal, which will require continued efforts and policy interventions to address.

 

 

 


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