Share of clean energy in electricity still below 30%

Context & Significance

• India has achieved a major milestone in its clean energy journey by ensuring that 50% of its total installed electricity capacity now comes from non-fossil fuel sources.
• This target was achieved five years ahead of its commitment under the Nationally Determined Contributions (NDCs) to the Paris Climate Agreement.
• However, despite this success in installed capacity, the actual share of clean energy in electricity supplied to consumers remains below 30%.

Relevance : GS 3(Energy and Environment)

Installed Capacity vs. Actual Electricity Supply

• Installed Capacity: Refers to the total potential a power source can produce under ideal conditions.
  • India’s installed clean energy capacity has now reached 484 gigawatts (GW).
  • This includes solar, wind, hydro, biomass, nuclear, and other non-fossil fuel sources.
• Actual Electricity Supplied: Represents the amount of electricity actually generated and delivered to consumers.
  • Despite 50% of capacity being clean, only 28–30% of electricity generation currently comes from these sources.
  • This gap is due to the lower efficiency and variability of renewable sources.

Historical Progress (2014–2024)

• In 2014, the share of clean energy in total electricity generated was around 17%.
• By April 2024, this increased to 28%, highlighting steady growth but also the limitations of renewable energy output.
• The growth in capacity is attributed to policy pushes and leadership focus, especially under Prime Minister Narendra Modi.

Understanding Capacity Utilisation Factor (CUF)

• CUF = (Actual energy generated / Maximum possible energy generation) × 100
• It measures how effectively installed capacity is used.
• Clean energy sources generally have lower CUF compared to conventional ones:
  • Solar CUF: ~20%
  • Wind CUF: 25–30%
  • Coal CUF: ~60%
  • Nuclear CUF: ~80%
• Hence, although clean energy’s installed capacity is high, its actual output remains limited.

Technical & Structural Challenges

1. Intermittency of Renewables:
   1. Solar and wind are weather-dependent and time-bound.
   2. Solar generation peaks during the day, but evening demand remains unmet.
   3. Energy cannot be stored efficiently with current technologies.

• Inflexible Grid Infrastructure:
  • India’s grid does not yet allow time-of-day pricing for electricity.
  • Consumers pay the same price per unit, whether it’s cheap solar in the afternoon or expensive coal at night.
• High Coal Dependence:
  • Coal still supplies ~75% of India’s daily electricity needs.
  • Coal remains more reliable due to its ability to run continuously.
  • Even when renewable output increases, the base-load requirement is still met by coal.

Solutions and the Way Forward

1. Grid Flexibility & Smart Management:
   1. Implement time-differentiated tariffs to encourage day-time electricity usage.
   2. Adopt smart meters and smart grid technologies for real-time monitoring and flexibility.

• Investment in Battery Storage:
  • Efficient storage will help store excess solar/wind energy and use it during peak demand (especially evenings).
  • Storage will improve overall CUF and reliability of clean energy.
  • This will reduce coal demand during peak hours.
• Hybrid Energy Projects:
  • Combine solar + wind + hydro + storage to balance intermittency.
  • Hybrid systems offer round-the-clock power supply.
  • Such integrated models are being promoted for peak and base load balance.
• Policy Innovations:
  • Encourage differential power tariffs based on time and source.
  • Shift incentives toward dispatchable renewables.
  • Prioritize investment in energy storage, inverter technology, and load management systems.

Expert Opinions

• Saurabh Kumar, Vice-President, Global Energy Alliance:
  • Highlights need for “differential pricing” similar to the early telecom sector (e.g., night-call pricing).
  • Emphasizes the need for battery storage and grid reform to fully utilize clean energy.
• Arunendra Kumar Tiwari, Fellow, TERI:
  • Stresses that solar’s CUF is low, limiting its contribution despite high capacity.
  • Notes that coal and nuclear outperform renewables in actual energy generation.

Broader Implications

• India’s clean energy journey demonstrates policy success in capacity building.
• However, future efforts must focus on:
  • Efficiency, not just installation.
  • Technology adoption, especially in storage and smart grids.
  • Consumer behaviour change, through time-of-day pricing.
• Balancing energy security, affordability, and sustainability remains the core challenge.