New Delhi, September 25, 2023 – India’s energy landscape is poised for dramatic transformation as its final energy demand is projected to double, reaching approximately 1200 Mtoe (Millions tonnes of oil equivalent) by 2070, according to a comprehensive report jointly authored by FICCI (Federation of Indian Chambers of Commerce and Industry) and Deloitte India.
Entitled “India’s Energy-Transition Pathway: A Net-Zero Perspective,” this study underscores the monumental challenge of meeting India’s ambitious net-zero emissions target by 2070, a goal that necessitates a staggering investment of approximately US $15 trillion.
The report outlines three critical pillars that will form the foundation of India’s energy transition strategy: grid decarbonisation, industrial decarbonisation, and transport transition. Together, these sectors are expected to address nearly 90 percent of India’s current emissions.
Anish Mandal, Partner, Consulting, Deloitte India, emphasized the urgency of India’s impending energy demand surge, stating, “India’s looming energy demand, poised to double by 2070, is a clarion call for sustainable transformation. It’s important that we embrace the energy transition levers and focus on creating an ecosystem which enhances domestic manufacturing, fosters global partnerships, and attracts investments.”
In the realm of grid decarbonisation, the report highlights the need for a significant increase in the share of electricity in the end-use energy mix, projected to surge from 18 percent in 2020 to over 50 percent by 2070. To achieve this transformation, Deloitte’s data envisions a roadmap involving more than 2000 GW of large-scale renewable energy derived from wind and solar, alongside an additional 1000 GW capacity for green hydrogen generation. Implementing this vision will demand an annual capacity expansion of approximately 50 GW of renewable energy, a substantial increase compared to the historical rate of 15–20 GW per year.
To realize these ambitious goals, the report underscores the importance of expediting renewables procurement through accelerated bidding processes. It also emphasizes the pivotal role of state governments in ensuring timely land allocation and project clearances. Furthermore, the report advocates for enhancing domestic manufacturing capabilities while considering temporary trade barrier relaxations and explores the potential contributions of hydro and nuclear resources in this transition.
The second pillar, industrial decarbonisation, focuses on sectors such as steel, cement, aluminum, and fertilizers, with a particular emphasis on Green Hydrogen (GH2). GH2 is envisioned to play a substantial role in meeting energy demands, exceeding 50 million tons by 2070. The report calls for strategic initiatives to make GH2 more cost-effective and universally accepted.
In the realm of transport transition, the report advocates for India’s adoption of reduced-emission technologies, including Battery Electric Vehicles (BEVs), Hydrogen Combustion Engines, and Fuel Cell Electric Vehicles (FCEVs). Establishing an extensive charging infrastructure, supported by forward-thinking urban planning, is identified as a critical component of this transition.
The report underscores the necessity of robust Public-Private Partnerships for developing charging and hydrogen refueling systems. It also highlights the importance of strategic urban planning, with an emphasis on railways, freight corridors, and public transport. The report acknowledges potential supply chain and geopolitical challenges linked to critical mineral imports like lithium and cobalt.
The financial aspects of this transition are also addressed in the report, with a focus on the roles of government, the private sector, and Multilateral Development Banks (MDBs). The report recommends the introduction of innovative financial instruments such as Contracts for Differences (CfDs) to facilitate the transition.
Shailesh K Pathak, Secretary General, FICCI, emphasized the importance of these efforts, particularly in India’s renewable energy sector. He stated, “With conducive policy support, steady inflow of investments, and technological developments, India has seen an exponential growth in its Renewable Energy (RE) sector, especially with solar power generation in the past few years. These are important for India’s commitment to achieving net-zero emissions by 2070.”
In conclusion, the report underscores the critical need for long-term, medium-term, and short-term planning, coupled with rigorous monitoring. It advocates for a collaborative approach involving central and state governments, along with industry experts. State governments, in particular, are recognized as key players in shaping energy policies that align with national aspirations, with sector-specific targets guiding corporate emission reduction strategies. This collective effort is deemed essential to realizing India’s ambitious net-zero emissions goal by 2070.
