Research area: Energy Transitions
How India can keep cool as energy demands overheat its power grid
संतुलित शीतलन, सुदृढ़ ग्रिड: भारत की संकटग्रस्त विद्युत प्रणाली के लिए सुधार का मार्ग
Free Power Debate
Re-Powering Rural Dignity: Rural Transformation Through Energy Transition
Abstract
In the electric power discourse, rural India holds an undignified space. Non-payment for electricity consumption by rural households, free power for farmlands, power theft and pilferage, and the high cost of supplying to geographically dispersed rural load centres have been seen as a bane for the electric power system in India. Moreover, the organised demand for subsidised electricity in rural areas is alleged to be the root cause for a rising and unsustainable pattern of electricity-centred competitive populism. On the other hand, owing to these allegations, rural India is often deprived of a reliable electricity supply and the dignity of consumer service to the extent that electricity access has no meaningful impact on productivity and human well-being.
In this backdrop, this chapter argues that the ongoing transition in the electric power systems from fossil fuel to renewable energy is an opportunity to rethink rural energy demand and thus restore rural dignity in the nation’s growth discourse. The chapter suggests ways to harness renewable energy, particularly solar energy, and reliable access to electricity to boost rural productivity in farm and non-farm activities, diversify rural livelihoods, and thus, contribute to building a resilient rural India. It envisions dignified access to modern energy in rural India through the promotion of electric-powered on-farm value additions, expansion of non-farm activities, in ways that are sensitive to intersectional barriers, and the enhancement of rural energy demand and ability to pay for the cost of electricity.
Governing India’s Just Energy Transition: The Case of Jharkhand’s Task Force on Sustainable Just Transition
Highlights
– At present, the governance of the energy transition is nested within broader climate governance frameworks and lacks a dedicated national policy or institutional architecture. As a result, state-level preparations remain limited, and just transition objectives are not systematically integrated into policies, planning processes, or intergovernmental coordination mechanisms.
– India’s energy transition is bound to be shaped by developments at the subnational level, particularly in the coal-dependent eastern states, where the economic, social, and fiscal impacts of the transition are most acute. Subnational institutional governance is therefore essential to ensure a just energy transition.
– This study takes the example of Jharkhand’s Task Force on Sustainable Just Transition, a first-of-its-kind institution established to address social and economic issues while guiding the state towards a low-carbon economy aligned with national climate goals.
– Using the Task Force as an example of an enabling institution, the study identifies key institutional challenges and draws lessons for other states to strengthen subnational preparedness, policy alignment, capacity, coordination, participation, and data systems for a just energy transition.
Energy Transitions Preparedness Initiative: Transport Sector FY 23-24
Executive Summary
– As India advances towards an energy transition, actions taken in the transport sector – the fastest-growing sector in terms of energy consumption – will be crucial. Because road transport is a State List subject under India’s Constitution, state-level decisions will be critical for realising an energy transition.
– The Energy Transition Preparedness Initiative (ETPI) provides a framework to assess state-level progress towards an energy transition across India’s electricity, buildings, and transport sectors. It covers ten states that account for more than 50% of India’s transport sector emissions.
– By analysing publicly available data and reports, this study highlights the progress made by states in the base year, 2020–21.
– The study reveals that progress has been made in policy formulation around major aspects of the transport energy transition: prioritising non-motorised transport (NMT) and public transport, encouraging electric vehicle (EV) adoption, scrapping old vehicles, and promoting densification around transit hubs. However, a defined articulation of targets can guide a more focused transition.
– In converting policy to action, intent varies across states. This study highlights that the structures that can guide the focused implementation of energy transition projects are still nascent. Dedicated and consistent funding, integrated governance, and data-driven decision making can play a critical role in accelerating implementation.
Energy Transitions Preparedness Initiative: Buildings Sector FY 23-24
Executive Summary
– The Energy Transition Preparedness Initiative (ETPI) is an effort to study states’ progress towards achieving the energy transition by analysing their plans, actions, and governance processes through a set of indicators. One of the focus sectors under ETPI is buildings, which falls under state jurisdiction and is guided by state-level policies.
– The ETPI indicator framework for buildings was used in 10 states for the study period FY 2020–21 (the report was published in 2024). These states are Bihar, Delhi, Gujarat, Karnataka, Kerala, Madhya Pradesh, Maharashtra, Rajasthan, Tamil Nadu, and Uttar Pradesh. This report builds on the FY 2020–21 baseline and includes updates through FY 2023–24. The five-building sector indicators cover aspects such as Energy Conservation Building Code (ECBC) compliance and Eco Niwas Samhita (ENS) preparedness; promotion of rooftop solar photovoltaic (RT-SPV) systems, energy-efficient appliances, and energy efficiency and clean energy in public buildings; and energy efficiency and clean energy in affordable housing.
– We have used publicly available information. The goal is to highlight examples of good practice, facilitate cross-learning, and encourage the adoption of approaches suitable for state-specific contexts.
– We find that the studied states are progressing in adopting and notifying building codes. However, for successful implementation, it is important to remove local-level barriers by simplifying compliance procedures, creating a pool of experts to assist with compliance, and enhancing the awareness and capacity of institutions.
– Power distribution companies and State Designated Agencies in some of the studied states, such as Delhi, Karnataka, Kerala, and Maharashtra, are promoting energy-efficient appliances, offering an opportunity for other states to learn from these examples and adopt similar initiatives. Also, stronger market surveillance efforts are needed for the Standards & Labelling programme to drive greater market transformation.
– In state-specific affordable housing schemes and policies, little attention is paid to thermal comfort in the design and construction of projects. However, recently there have been efforts to integrate climate resilience measures into rural affordable housing projects under the Pradhan Mantri Awaas Yojana-Gramin (PMAY-G) programme.
Beyond the Hype: Opportunities and Limits of India’s Green Hydrogen Pursuit
India’s hydrogen demand is expected to double, reaching approximately 12 million metric tonnes per annum (MMTPA) by 2030, driven primarily by the expansion of the fertiliser, refinery, and petrochemical sectors. India currently meets most of its hydrogen demand from natural gas via steam methane reforming. As the country pursues its targets for energy independence by 2047 and Net-Zero emissions by 2070, green hydrogen has arguably emerged as a key component of its energy transition calculus.
India launched the National Green Hydrogen Mission (NGHM) in January 2023 with an outlay of INR 19,744 crores and a target to achieve 5 MMTPA green hydrogen production capacity by 2030. Produced by renewable energy (RE) powered electrolysers, green hydrogen can potentially decarbonise ‘hard-to-abate’ sectors. Building on strong private-sector interest and additional support from state governments, the country now aims to secure 10% of global green hydrogen production capacity, which is projected to surpass 100 MMTPA by 2030.
Can green hydrogen truly become the game-changer it is hailed to be? Our blog analyses India’s pursuit of green hydrogen, examines the opportunities, challenges, and risks in its current approach.
Pursuit of Green Hydrogen
The hype around green hydrogen has fuelled ambitious targets and high expectations. Meeting the NGHM target would require installing 60-100 GW of electrolyser capacity. It is expected to leverage over INR 8 lakh crore investments and create 6 lakh green jobs. Besides the financial incentives, the Government of India (GoI) has streamlined permits and waived transmission charges for RE procurement. Several states have announced or are working on policies to support green hydrogen and its derivatives.
Four promising narratives shape India’s green hydrogen ambition:
– Decarbonise hard-to-abate sectors: Green hydrogen and its derivatives are positioned as key solutions for decarbonising hard-to-abate sectors where direct electrification is impractical or inefficient, such as energy-intensive industries (like steel and cement), long-haul road transport, shipping, and aviation. India supports hydrogen technology demonstration projects in these sectors.
– Generate employment: Green hydrogen production and export are expected to become a significant driver of job creation. The NGHM is expected to generate over 6,00,000 jobs by 2030, an aspiration shared by the states. Andhra Pradesh aims to create 12,000 jobs per MMTPA of green hydrogen production, while Uttar Pradesh’s policy envisions generating 1.2 lakh direct and indirect jobs. Gujarat is projected to create 1.8 lakh jobs owing to opportunities in hydrogen electrolyser manufacturing.
– A vehicle for industrialisation: While India sees green hydrogen as an opportunity to reduce its dependence on fuel imports, it also aims to become a global hub of production, use, and export of green hydrogen and its derivatives. It is looking to tap into the green hydrogen export markets in Europe and East Asia. Cheap RE, lower labour and land costs, and access to multiple ports across the long coastline are claimed to bolster India’s export capabilities. GoI has sanctioned four hydrogen valley clusters in Bhubaneswar (Odisha), Jodhpur (Rajasthan), Kochi (Kerala), and Pune (Maharashtra), and has designated three green hydrogen hubs in Paradip (Odisha), Tuticorin (Tamil Nadu), and Kandla (Gujarat).
– Address regional imbalances: The eastern and north-eastern states, currently lagging in solar and wind energy development, can capitalise on the green hydrogen transition by leveraging their rich mineral and industrial base. A TERI study claims industrial clusters offer a promising opportunity for the early development of hydrogen infrastructure. Notably, the iron and steel industries are concentrated near coal and iron ore deposits in Odisha, Jharkhand, West Bengal, and Chhattisgarh. Green hydrogen is an opportunity for these states to leap forward in their energy transition.
The Challenges
However, the pursuit of green hydrogen is not free from challenges. Realising the promises will require managing these challenges.
– Domestic market: The NGHM has spurred a significant supply-side response, with announced production capacities reaching nearly 2.5 times the 2030 target. However, this momentum has not translated to the demand side. The biggest hurdle right now is cost. Green hydrogen costs about $4–$5 per kg, while grey hydrogen is much cheaper at $2.3–$2.5 per kg. By 2030, financial incentives and falling solar and wind energy prices can bring the cost of green hydrogen production to around $3–$3.75 per kg. Still, it’s unlikely to match grey hydrogen anytime soon. Creating demand through strategies such as blending in high-volume sectors (refining, fertiliser, piped natural gas) or replacing grey hydrogen in niche industries (chemicals, glass, ceramics) might help.
– Export demand: Exports could help boost uptake of green hydrogen. If export opportunities are fully tapped, NGHM targets could be exceeded to 10 MMTPA. To support export, GoI is prioritising the development of port infrastructure, including storage and refuelling capabilities, and has identified strategic export hubs. Encouraging demand signals from markets willing to pay a premium for low-carbon hydrogen, like Germany, Japan, South Korea, the Netherlands, and Belgium, further reinforce this ambition. However, uncertainties surrounding the export market and evolving standards compound the problem. Energy losses across the supply chain (production, compression/liquefaction, storage, and reconversion) of hydrogen and its derivatives further raise doubts on the reliability of the export-oriented strategy.
– Powering green hydrogen: The NGHM envisages an additional 125 GW of RE capacity for green hydrogen production. However, India’s 2030 target for 500 GW non-fossil electricity generation capacity does not account for this demand. Even if the target is met, a CSEP study claims, it will be insufficient to meet rising electricity demand. At the current pace of RE deployment in India, green hydrogen risks competing with other critical electricity demands, thereby spiking demand for coal-fired electricity.
Another critical consideration is India’s RE mix. Wind-Solar Hybrid electrolysers have demonstrated higher capacity utilisation compared to standalone solar or wind systems. Greater reliance on wind within the mix can further optimise utilisation and reduce levelised costs. However, India’s installed wind capacity (52 GW) is less than half of its solar capacity (130 GW), creating an imbalance that could hinder cost-effective green hydrogen production.
– Resource constraints: Low volumetric energy density poses challenges for hydrogen’s transportation, storage, and distribution infrastructure. Delays in infrastructure development, insufficient subsidies, policy uncertainties, lack of mandates, unreliable grid power, and land availability are delaying Final Investment Decisions (FID). Furthermore, India’s reliance on China for critical and rare-earth minerals needed in electrolyser manufacturing raises significant supply chain concerns.
The cost of electrolysers is expected to decline, aided by policy measures like production-linked incentives. However, low demand may defer commissioning of electrolysers. Financial professionals estimate the technology risk associated with green hydrogen, given evolving technologies such as electrolysers, fuel cells, and storage, as compared to proven technologies like solar and wind. India’s limited focus on hydrogen technology research and development (R&D) leaves it ill-equipped to adapt to rapid advancements.
India’s hydrogen demand is projected to grow over 50 MMTPA by 2070, prompting calls to explore alternative low-carbon sources. Geological surveys suggest that India may hold 3,475 million tonnes of natural hydrogen (white hydrogen), which can potentially meet the demand until green hydrogen becomes viable. Other potential options include pink hydrogen, produced using nuclear power, and blue hydrogen, derived from natural gas with carbon capture and storage. However, these options involve unproven technologies and high costs.
Beyond its role in decarbonisation and energy security, green hydrogen presents new development paths for late-industrialising countries like India. India regards green hydrogen as a first-mover advantage to secure technological and market leadership in clean energy. However, current policies and fiscal measures are geared largely toward deployment rather than innovation. India’s modest public spending on R&D does not reflect the scale of its ambitions. For more details on the green hydrogen R&D landscape, see our blog.
The global surge in green hydrogen is criticised as a form of green extractivism, framing resource appropriation as a climate imperative. India’s current strategy, along with that of other developing nations, focuses on leveraging export opportunities, risks replicating the extractive patterns of fossil-fuel economies. Mitigating these risks calls for an approach grounded in environmental justice, redistribution, and a transformative vision.
Cities at the Forefront: Shaping Low-carbon Futures in India
Abstract
India’s cities are at the centre of the global climate and energy transition. They remain deeply dependent on fossil fuels as hubs of high consumption and emissions, yet simultaneously drive economic growth, industry, and employment. As India pursues its Net Zero commitments, the way its cities restructure energy use will shape national and global low-carbon trajectories.
In this context, using examples from a few large and medium-sized cities, this paper explores how cities of different sizes in India are creating different clean energy pathways and examines the political economy of the energy transition in cities. The article discusses the multifaceted nature of the transition, emphasising the difficulties associated with evolving energy systems within urban environments. The paper also reflects on the issues and challenges, and discusses the adoption and participation of different sections of city dwellers in this transition.