New Delhi,
Feb 15. The cost of generating solar energy in India is set to fall to as low
as Rs 1.9 per unit by 2030 with technological advancements increasing
efficiency, a joint study by TERI and Climate Policy Initiative (CPI) revealed
on Wednesday.
“By
2030, we project that the cost of wind and solar will be between Rs 2.3-2.6 per
kilowatt hour (kWh) and Rs 1.9-2.3 per kWh respectively, while the cost of
storage will have fallen by about 70 per cent,” the report launched at the
World Sustainable Development Summit 2019 here said.
The report
titled ‘Accelerating India’s transition to Renewables: Results from the ETC
India Project’ suggests that by 2030, solar electricity could be as cheap as Rs
2.3 per kWh and even cheaper solar costs are possible, in the order of Rs 1.90
per kWh, if the widespread deployment of tracking technology raises the
capacity utilization factor of new plants above current levels.
Likewise for
wind, with mast heights increasing from the current level of 80 metres to 100
and even 120 metres, baseline projection for 2030 for the levelized costs of
wind at Rs 2.58 per kWh could be as low as Rs 2.26 for projects with higher
capacity utilization factors.
“We
knew that renewables were cheap in India, but there were concerns that
balancing their intermittency would raise consumer costs. This need not be the
case: a high renewables system is cost-effective,” Dr Ajay Mathur,
Director General of The Energy and Resources Institute (TERI), said.
According to
the findings, the required investments in electricity generation capacities are
substantial, at about Rs 1.65-1.75 lakh crore per year. This is slightly above
the rate achieved over the last 10 years, which was around Rs 1.40-1.50 lakh
crore per year, and represents a substantial financing challenge given the
current stresses on the Indian banking system.
In contrast
to the falling prices of solar and wind energy, the study has found that
new non-pithead coal could be as expensive as Rs 6.98 per kWh by 2030, while
cheaper pithead coal would be Rs 4.85 per kWh by 2030.
“We
project the tariffs of new coal-fired electricity to rise, due to increases in
coal transportation costs and increases in coal plant capital costs to improve
efficiencies and reduce local pollution,” the report said.
It also
states that in the high renewables scenario, the share of variable renewables
including wind and solar will reach 30 per cent of total generation by 2030,
and 390 GW of capacity.
The Energy
Transitions India (ETC India) report estimates the total share of all
zero-carbon technologies in generation, including large hydro and nuclear, to
reach 45 per cent. “This represents rapid decarbonization of Indian power
production,” it said.
“This
would make India’s power sector as clean as that of Japan today, a
tremendous achievement for a country of India’s level of income per capita. It
would represent a truly unprecedented leapfrog into a cleaner electricity
system,” the report said.
TERI also released a book on the occasion, ‘Green, Reliable and Viable: India’s Shift Towards Low-Carbon Energy’ on Energy Transitions in India, which brings together perspectives from key stakeholders from the power, mobility, agriculture and energy efficiency sectors, amongst others, offers their views on the challenges that lie ahead, and the solutions and next steps to move India forward on the decarbonisation pathway.
