“India’s energy transformation requires three things: investment, investment and investment.”
So said IEA Executive Director Fatih Birol today as he launched a new report into India’s energy challenges and opportunities.
Earlier this month, Birol focused on India at the launch of the IEA’s World Energy Outlook, and today he expanded his assessment of the country’s power potential.
He said that India is set to contribute more than any other country to the rise in global energy demand over the next 25 years, “underlining its ever-greater influence in Asia and on the world stage”.
“A lot is being done already to overhaul the energy regulatory system and get the incentives in place,” he said, adding that “this is vital, as India will need to call upon a wider range of investors and sources of finance than it has in the past.”
In its special report, India Energy Outlook 2015, the IEA states that India must ensure that energy “is a spur, rather than a hindrance” to its advancement, and added that policymakers “must redouble efforts to bring capital into the sector, particularly in more efficient and low-carbon technologies”.
The IEA calculates that India needs more than $140bn in energy investment every year between now and 2040.
It predicts that India will become by far the largest source of worldwide coal demand growth, most of which will be met by expanded domestic production, and also the world’s second-largest market for solar PV, as the deployment of renewables gathers pace in the power sector.
And the IEA has highlighted what it calls as “India’s historic climate pledge” in the run-up to the Paris climate summit.
“India’s climate pledge is a beacon for the cleaner path that India intends to follow, highlighting to the world that economic growth and social transformation can be pursued with a regard for the wider environment,” said Birol.
Mytrah Energy is a company specializing in renewable projects in India. Its executive vice-president Bob Smith told Power Engineering International: “I am delighted that the IEA have confirmed what we at Mytrah have been saying for some time – that India is the most exciting power market in the world.”
Smith said that the combination of rapid economic growth and a relatively low per-capita consumption “places India at the centre of the world energy stage, with demand growth exceeding all other countries over the next 25 years”.
He said that Mytah had been “attracted by the rapidly growing market, and the lack of large government subsidies”, and had “built a portfolio of 578 MW of windpower in India over the last five years. Wind is cost-competitive with fossil fuels in India and has the great advantage of being very quick to construct – an ideal solution for a rapidly growing market.”
Smith agreed with the IEA that solar will also be a “very large market in India now that costs have fallen to the point where substantial subsidy is not required. We commissioned our first solar projects this year and have a substantial pipeline in development.”