India's Energy Transition: A Budget Boost for Renewable Energy and Emerging Technologies
July 13, 2024, 3:57 am
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In a bold move towards modernizing its energy infrastructure, India is poised to prioritize advancements in the electricity sector in the upcoming budget, with a strong emphasis on renewable energy sources and emerging technologies. The central government's commitment to strengthening the country's energy security and reducing its reliance on fossil fuels is evident in the proposed fiscal policies. Anujesh Dwivedi, a partner at Deloitte India, highlighted the government's aim to localize the manufacturing base for solar, hydrogen, and batteries, influenced by global geopolitical shifts post-COVID19.
The upcoming budget is expected to reinforce the government's dedication to these sectors by further supporting local manufacturing capabilities aligned with global energy transition trends. The fiscal policies are anticipated to underscore the resilience of India's electricity infrastructure, with a focus on mitigating the impacts of increasingly severe weather events linked to climate change. This includes significant allocations towards digitizing electrical grids to facilitate the integration of Distributed Energy Resources (DERs) and enhance the capacity to manage peak demands efficiently.
India has made significant strides in renewable energy, achieving a milestone of adding 18 GW of solar capacity in FY24. However, the country faces the challenge of scaling up annual renewable energy capacity to approximately 50 GW to reach its 2030 target of 500 GW of non-fossil fuel generation. Dwivedi emphasized that expanding renewable capacity on this scale requires not only continuing existing initiatives but also a focused effort, particularly towards corporate contributions to renewable energy and offshore wind projects.
The budget is also expected to shine a spotlight on emerging energy technologies such as electric vehicles (EVs), green hydrogen, and Nuclear Small Modular Reactors (SMRs), which are deemed crucial for enhancing India's energy security and reducing its dependency on fossil fuels. Investments in the upcoming budget are likely to include substantial support for improving transmission and distribution infrastructure, accompanied by strategic measures to digitize the grid and enhance its capability to manage the requirements of a modern, decentralized energy system.
Finance Minister Nirmala Sitharaman is scheduled to present the Union Budget for FY25 on July 23, following a Budget session starting on July 22 and concluding on August 12. With the stage set for a significant boost in renewable energy and the adoption of emerging technologies, India is on the cusp of a transformative energy transition that will shape a cleaner, more sustainable energy landscape for the future.
The upcoming budget is expected to reinforce the government's dedication to these sectors by further supporting local manufacturing capabilities aligned with global energy transition trends. The fiscal policies are anticipated to underscore the resilience of India's electricity infrastructure, with a focus on mitigating the impacts of increasingly severe weather events linked to climate change. This includes significant allocations towards digitizing electrical grids to facilitate the integration of Distributed Energy Resources (DERs) and enhance the capacity to manage peak demands efficiently.
India has made significant strides in renewable energy, achieving a milestone of adding 18 GW of solar capacity in FY24. However, the country faces the challenge of scaling up annual renewable energy capacity to approximately 50 GW to reach its 2030 target of 500 GW of non-fossil fuel generation. Dwivedi emphasized that expanding renewable capacity on this scale requires not only continuing existing initiatives but also a focused effort, particularly towards corporate contributions to renewable energy and offshore wind projects.
The budget is also expected to shine a spotlight on emerging energy technologies such as electric vehicles (EVs), green hydrogen, and Nuclear Small Modular Reactors (SMRs), which are deemed crucial for enhancing India's energy security and reducing its dependency on fossil fuels. Investments in the upcoming budget are likely to include substantial support for improving transmission and distribution infrastructure, accompanied by strategic measures to digitize the grid and enhance its capability to manage the requirements of a modern, decentralized energy system.
Finance Minister Nirmala Sitharaman is scheduled to present the Union Budget for FY25 on July 23, following a Budget session starting on July 22 and concluding on August 12. With the stage set for a significant boost in renewable energy and the adoption of emerging technologies, India is on the cusp of a transformative energy transition that will shape a cleaner, more sustainable energy landscape for the future.