Accelerating India’s

clean energy transition

Prepared for India Energy
Transition Summit

June 2022

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 We acknowledge contributions from

Somesh Kumar Mohammad Saif Shuboday Ganta

Partner & Leader – Power & Utilities Partner – Power & Utilities Vice President – Power & Utilities
Strategy and Transactions (SaT) Strategy and Transactions (SaT) Strategy and Transactions (SaT)
EY India EY India EY India

Aaron Cherian Aditya Prakash Utkarsh Mathur

Senior Associate – Power & Utilities Senior Associate – Power & Utilities Associate – Power & Utilities
Strategy and Transactions (SaT) Strategy and Transactions (SaT) Strategy and Transactions (SaT)
EY India EY India EY India

Vipul Tuli Shivanand Nimbargi Ganesh Srinivasan Prabir Neogi

Chair, FICCI Power Co-Chair, FICCI Renewable Co-Chair, FICCI Power Mentor, FICCI Power
Committee & CEO, South Energy CEOs Council and Committee & CEO, Committee and Chief
Asia - Sembcorp Industries MD & CEO, Ayana Power TPDDL. Adviser – Corporate Affairs,
RP-Sanjiv Goenka Group

Jyoti Vij, Arpan Gupta Nishit Jain Shikha Jain Kalyan Verma
Deputy Secretary Additional Director Senior Assistant Director Senior Assistant Director Senior Assistant Director
General, FICCI FICCI FICCI FICCI FICCI

Vikas Mehta Kartikeya Singh Rita Roy Choudhury

Executive Director Director of Programmes Former Assistant Secretary
SED Fund SED Fund General, FICCI

2 Accelerating India’s clean energy transition

 Foreword
To achieve the targets envisaged, Energy
Transition will be the most important pillar
moving ahead. FICCI as the apex business
organization in the country has been
supporting the Government with its inputs and
activities in this crucial area and we are now
Mr. Arun Chawla,
pleased to present a well-researched report –
Director General,
‘Accelerating India’s Energy Transition’ in
FICCI
collaboration with EY.
This report highlights the initiatives required to
India is pioneering a new model of economic create a robust ecosystem to enable the energy
development that could avoid the carbon- transition. The report covers clean energy
intensive approach. The use of renewable opportunities currently under development -
energy not only helps in the primary objectives project pipeline as well as signifies their impact
of advancing economic development and on economic development, job creation and
mitigating climate change but also improves environment sustainability. It also provides key
energy security and access to energy. recommendations to overcome impediments to
The Hon’ble Prime Minister has laid out India’s the clean energy growth in India.
commitments towards climate action at CoP26 We hope this report will provide useful inputs
Summit in his ‘Panchamrit statement’ as five- to the Government, Industry and stakeholders
point action agenda. India’s commitment to to drive next wave of energy transition in India
energy transition and non-fossil energy and stimulate policy direction on the subject.
capacity coupled with several positive steps
taken towards sustainable development shows I take this opportunity to place on record our
our country’s leadership and strength. It also gratitude to FICCI Renewable Energy CEOs
highlights on the firm intent of the Council, FICCI Power Committee and others
Governments to move rapidly towards carbon from the industry and government for their
reduction and net zero. valuable insights.

3 Accelerating India’s clean energy transition

 Foreword
Power sector is currently leading the energy
transition efforts globally including India
enabled by rapid decline in the cost of
intermittent solar and wind energy sources for
Mr. Somesh Kumar electricity production. However, the availability
of competitive long duration energy storage
Partner & Leader
technologies will determine the speed and scale
(Power & Utility),
of the transition in this sector going forward. In
EY India
the hard to abate sectors such as
manufacturing (e.g. steel, cement, ammonia
The impacts of COVID pandemic and the etc.) and transport that rely heavily of fossil
ongoing conflict in Ukraine is a stark reminder fuels, green hydrogen is emerging as a
on how India’s dependence on energy imports promising low carbon feedstock / energy
and other commodities linked to global supply carrier. The competitiveness of these
chains can threaten its strategic interests. In technologies along with enabling policy
this context, the ongoing energy transition is a ecosystem will determine the speed and scale
boon for India’s long term energy security, of the transition in future.
sustainability and self-reliance. In this report, EY has identified over ~650
India’s thriving renewable energy markets and ‘shovel-ready’ energy transition investment
enabling policy ecosystem has helped retain its opportunities at various stages of
position among the top 3 markets globally in development. This pipeline shows tremendous
the EYs ‘Renewable Energy Country potential for capital deployment and other
Attractiveness Index’ (RECAI). socio-economic benefits in terms of
employment generation and avoided CO2
Decarbonization, decentralization, digitization emissions. Moreover, these projects are critical
and aatma-nirbharta are the four building to accelerate India’s energy transition and play
blocks of India’s energy transition. Equitable a key role in achieving India’s long term
and affordable energy access for all to meet commitments towards climate change
economic development objectives is non- mitigation.
negotiable in this transition. At the same time,
energy efficiency and environmental
sustainability remain the key drivers of this
transition.

4 Accelerating India’s clean energy transition

CONTENTS Section 1
Executive summary
Section 2
Setting the context
Section 3
Frameworks for
Section 4
Decarbonizing
for India’s Energy energy demand India’s electricity
Transition: Building planning and ‘JUST’ grid with utility
blocks and policy transition scale RE power
enablers generation

Section 5 Section 6 Section 7 Section 8

Decentralization of Advancing Pipeline of EV Enabling Green
power system self–reliant supply charging Hydrogen policies
through distributed chains for infrastructure to decarbonize
generation sustainable energy projects manufacturing
transition sector

Annexures

5 Accelerating India’s clean energy transition

 Acronyms
AC Alternate Current IEA International Energy Agency PPA Power purchase agreement
ACC Advanced Chemistry Cell Indian Renewable Energy Development Agency
IREDA PSA Power sale agreement
BCD Basic Custom Duty Limited
PSU Public sector undertakings
BESS Battery Energy Storage System ISTS Interstate transmission network
C&I Commercial & Industrial kW kilowatt PV Photovoltaic
CAGR Compound Annual Growth Rate LiB Lithium ion Battery R&D Research and Development
CAPEX Capital Expenditure LOA Letter of Award
RE Renewable Energy
CEA Central Electricity Authority LTA Long–term access
CERC Central Electricity Regulatory Commission MNRE Ministry of New and Renewable Energy RESCO Renewable Energy Service Company

CFA Central Financial Assistance MoP Ministry of Power RPO Renewable Purchase Obligation
CPSU Central Public Sector Undertakings MSME Micro, Small & Medium Enterprises
RTC Round–the–clock
DCR Domestic Content Requirement Mt Million tons
RTPV Rooftop Solar Photovoltaic
DHI Department of Heavy Industries Mtoe Million tons oil equivalent
DISCOM Distribution Company MW Megawatt SCOD Scheduled Commercial Operational Date
DPR Detailed Project Report NHM National Hydrogen Mission SECI Solar Energy Corporation of India Limited
EESL Energy Efficiency Services Limited NSEFI National Solar Energy Federation of India
SERC State Electricity Regulatory Commission
EPC Engineering, Procurement and Construction NTPC National Thermal Power Corporation Limited
EV Electric Vehicle O&M Operation and Maintenance SPPD Solar Power Park Developer

EY Ernst & Young OEM Original equipment manufacturer SPV Special Purpose Vehicle

Federation of Indian Chambers of Commerce & OPEX Operating Expenditure

FICCI
Industry PBI Procurement based incentive UMREPP Ultra Mega Renewable Energy Power Park
GT&D Generation, Transmission & Distribution PERC Passivated Emitter and Rear Cell
GW Gigawatt PHC Primary Health Center UT Union Territory

GWp Gigawatt Peak PLI Production Linked Incentive VGF Viability Gap Fund
ICAR – Indian Council of Agricultural Research Central PM– Pradhan Mantri Kisan Urja Suraksha evam
CAZRI Arid Zone Research Institute KUSUM Utthaan Mahabhiyan WHO World Health Organization

6 Accelerating India’s clean energy transition

 Executive summary

1
7 Accelerating India’s clean energy transition
 Robust planning and predictable growth in demand for clean energy sources is essential for
accelerating energy transition investments
Decarbonization, decentralization, digitalization and aatma-nirbharta are the building Incentives for fossil to electricity transition technologies and solutions, particularly for
blocks of India’s energy transition to ensure equitable and affordable energy access for manufacturing industries can help accelerate inorganic growth of electricity demand in
all. Energy transition is fundamental to achieving long term economic development and the economy. Further, implementation of reforms to improve financial health of
sustainability objectives. Market outlook towards increasing share of electricity and other electricity distribution sector is fundamental to the bankability of energy transition
low carbon fuels in final energy consumption and gradual phasing out of coal and related investments. Implementation of ‘Draft Electricity (Promoting RE through Green
petroleum products in the primary energy mix are the defining characteristics of energy Energy Open Access) Rules, 2021’ can help MSMEs and other consumers having 100
transition. kW & above connected load with greater options for sourcing renewable energy.
Rapidly evolving energy transition technologies rising demand for clean energy sources Eventually, India’s energy transition may leave coal and petroleum industries,
and policies are the key enablers for driving market-based investments. Power sector is communities and workers exposed to decline in demand for fossil fuel commodities in
leading India’s energy transition driven by rapid decline in cost of intermittent solar and the long term. Understanding and addressing the social dimensions of energy transition
wind energy sources. However, availability of scalable long duration energy storage is critical to ensure that fossil fuel communities are not overly disadvantaged or left
technologies at competitive prices will determine the speed and scale of transition in the behind. Taking action to address the potential disparity in the economic and social
power sector going forward. Energy storage is critical to build adequate flexibility across outcomes from the inevitable transition can be labelled a just or equitable transition.
the power system value chain (GT&D) and integrate high shares of intermittent renewable Globally, there is a growing recognition among institutional investors that these social
energy sources. In this regard, viability gap funding for initial uptake of long duration considerations should form part of the broader response to the risks and opportunities
energy storage technologies looking beyond Li-ion chemistry is necessary. Whereas, inherent in the energy transition.
green hydrogen is rapidly emerging as an alternative low carbon energy carrier/vector to
decarbonize manufacturing and transport sectors, which account for ~32% of India’s GHG Theme: Robust planning and predictable growth in demand for clean energy
emissions. In the short to medium term, manufacturing industry will lead the way for sources
scaling up production and end-use of hydrogen, while transport and power sector
► Coordinated and harmonised framework for integrated resource and electricity
solutions, business models will evolve in the long term.
demand planning, particularly at the state level

Policy interventions
Robust and predictable growth in demand for clean energy sources is essential for ► Incentives for fossil to electricity transition technologies and solutions,
accelerating energy transition investments. There is a need to restructure the framework particularly for manufacturing industries to accelerate inorganic growth
of integrated resource and electricity demand planning in order to undertake technology, ► Implementation of reforms to improve financial health of electricity distribution
portfolio mapping and enhance coordination, especially at the state level for sector
harmonization of techniques and reporting with greater degree of granularity. States
► Formulate national policy framework for closure / phase-out / re-purposing of
must focus on conducting least cost generation expansion planning backed by optimal
coal-based power plants and mines focusing on Just Transition principles and
dispatch simulation at an hourly resolution for spot years (e.g., 2025/2030/2040). Such
goals
planning should also be accompanied by modelling network constraints and grid stability
analysis for validating integration of high shares of renewable energy for spot years. ► Formulate energy storage policy with viability gap funding for initial
uptake of long duration energy storage technologies

8 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 India must build resilience against forces threatening the affordability of energy transition
technologies, raw materials and commodities used for domestic production
Rising cost of domestic solar PV panels could delay the pace of energy transition in India. The government of India recently announced import duty cuts for critical raw materials
Studies from leading market research firms show that solar module prices have increased used in the iron, steel and plastic industries with the intention to reduce their prices for
between 30-50% in the past two years. Some critics may attribute the rise in solar module domestic consumption. Similar interventions could be explored to provide relief for
prices to imposition of BCD on imported PV cells (25%) and modules (40%) effective from critical commodities used in solar module manufacturing such as glass (e.g. soda ash)
April 2022. This is not entirely accurate. As per the data compiled by a leading solar PV and aluminium (e.g. pet coke, caustic soda), which could benefit the consumers of solar
market intelligence and research firm, solar module prices have become increasingly PV panels.
unpredictable and volatile since the inception of COVID in 2020. Solar module prices
Lithium-ion battery packs currently attract 30-40% taxes (import duty@15% and
(mono PERC) in the global market increased from August 2020 to November 2021 by
GST@18%) for consumers. These advanced chemistry battery packs will remain the
42%. On similar lines, solar module prices (mono PERC) in India also increased from
dominant technology for electrification of mobility and stationary energy storage
August 2020 to November 2021 by 40%.
applications critical for integration of intermittent renewable energy sources through
One of the principal reasons behind the rising cost of solar modules is supply chain 2030. The ACC PLI scheme envisages to add 50 GWh of manufacturing capacity in the
disruptions, especially raw materials and commodities used in the manufacturing of solar next 2-5 years with up to 60% of local value addition. The consumers could benefit from
panels. Polysilicon is the critical raw material used in solar PV module manufacturing. immediate relief from import duties and GST rates until the domestic manufacturing
Between July 2020 and April 2022, polysilicon price in the global markets increased 5-6 capacity is established for catering to the local demand. Any safeguard duties to protect
times. Other disrupting factors in the PV module supply chain include price hikes for the local manufacturers can be formulated in consultation with the industry.
commodities such as glass and basic metals (steel / aluminium), shortage of containers
etc. Such disruptions exacerbated further due to various COVID-19 induced lockdowns
across the world leading to halting of manufacturing activity. Theme: Building resilience against forces widening the gap between
The impact of BCD imposition on imported PV cells would taper down in the medium to sustainability and affordability of energy transition technologies
long term term as India builds sufficient PV cell manufacturing capacity planned under the
► Re-imagine solar PLI scheme to focus on manufacturing critical raw
existing solar PLI scheme. However, sustained higher cost of commodities, raw materials

Policy interventions
materials (polysilicon) and upstream value chain components
(polysilicon) and logistics used in the supply chain of solar PV modules is a major threat to
energy transition. Therefore, the current solar PLI scheme must focus on building ► Reverse GST rate to 5% for providing partial relief from rising solar panel
sufficient manufacturing capacity of 98% grade silicon from quartz, polysilicon, ingots and prices to the consumers
wafers, all critical components used in the production of solar PV cells and modules. ► Extend import duty cut reliefs for critical raw materials imported in the
production of glass and aluminium, commodities used in solar panels
Moreover, with the increase in GST rate from 5% to 12% on renewable energy equipment
(at the project level) the new effective rate of GST on wind and solar energy services ► Rationalize tax rates (import duty and GST rate) for lithium ion battery
comes to around 13.8%. Government of India should explore reversing this increase in packs until the domestic manufacturing capacity is established for catering
GST rate for providing partial relief from rising solar panel prices to the consumers. to the local demand

9 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Methodology for building energy transition investment pipeline
EY is collaborating with the industry to inform the ‘shovel–ready’ energy transition
investment opportunities in the pipeline. These opportunities help achieve the right
balance between economic development and energy transition goals by Government of
~650 low carbon infrastructure
India. The principal objectives of this collaboration are as follows:
► Identify ‘shovel ready’ low carbon investment opportunities under development –
projects in the pipeline
‘project pipeline’
► Assess what is at stake in terms of impact on economic development, jobs and
environment Thematic
► Build consensus on stimulus action to accelerate energy transition investments in the coverage
economic development plans of low carbon
EY has identified over 650 ‘shovel–ready’ energy transition investment opportunities in investment
the pipeline with tremendous potential for economic development, jobs and ultimately opportunities
contributing towards India’s long–term climate objectives. Project level information was Renewable in pipeline Manufacturing
gathered from primary and desktop research tools including consultations / interviews power original RE
with project developers, OEMs, investors etc. with the support of a leading market
research agency. Proprietary databases were also leveraged to identify the long list of
generation equipment
infrastructure projects in the pipeline. The “shovel–ready” projects identified are having
the desired potential to create social, environmental and economic value in the
immediate future. The assessment of employment potential in this report includes jobs
created under supply chain (OEMs), construction / installation, commissioning,
operations and maintenance of projects.

Limitations Energy EV charging

The project pipeline identified in this report represent just a fraction of the overall low storage H2 infrastructure
carbon infrastructure investment under development in India. The project pipeline was
put together from our assessment of their status of development until March 2022.
These projects illustrate the huge potential that exists across India to underpin the Green
speed and scale of energy transition. This is only a fraction of all low carbon Hydrogen
infrastructure projects under development in India. It is important to note that the
project pipeline identified in this report is illustrative and should not be read as a full Sources: EY and JMK Research’s own tracking of RE auctions from central and state agencies, projects emerging from Government
schemes promoting clean energy transition; National Infrastructure Pipeline hosted by Invest India; Other proprietary databases
policy/commercial endorsement.

10 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Overview of energy transition investment pipeline
Theme: Utility scale RE power generation
► Establish a national index along with regional sub-indices for RE pricing by pooling of
prices / tariffs discovered from RE auctions
360 103 GW INR 1.12
Policy interventions

Project pipeline
and impact
► Formulate model policy for aggregation and allocation of wasteland parcels for the projects of pipeline capacity lakh crore equity
development of gigawatt scale RE power parks
► Implement wholesale power market reforms, time of day pricing and demand response
frameworks to enhance flexibility for RE integration
► Implement the ‘Electricity Amendment Bill 2021’
INR 2.61 7.9 lakh 3,989 MT
lakh crore debt fresh jobs avoided CO2 emissions
► Enhance skilling initiatives to support RE industry for project execution

Theme: Distributed generation through rooftop solar PV systems

99 2.0 GW INR 913

Project pipeline
► Adopt best practices from Gujarat and Kerala models of scaling up RTPV

and impact
implementation, especially in the residential sector Projects of pipeline capacity crore equity
Policy inter..

► Frame policy and regulatory incentives to Promote utility owned / driven business
models for RTPV capacity addition
► Promote enabling mechanism for aggregation of 'distributed energy resources' to INR 2,129 18,000 80 MT
provide grid-related services crore debt fresh jobs avoided CO2 emissions
► Design and implement credit risk guarantee mechanisms to support RTPV financing for
MSMEs

Theme: Green Hydrogen production

Policy interventions

► Incentives to lower the cost of renewable power generation and supply for GH2
production
► GIS mapping and identification GH2 clusters for efficient infrastructure development
► Offtake guarantees similar to SATAT scheme for GH2 suppliers
► Prescribe GH2 purchase obligations / blending mandates for bulk consumers of
hydrogen as industrial feedstock along with viability gap funding

11 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

Theme: Distributed RE generation under PM-KUSUM
23 8.7 GW INR 6,855

Project pipeline
Policy interventions

and impact
► Generation-based incentives for decentralized grid connected ground mounted solar PV Projects of pipeline capacity crore equity
systems co–located with crops on agriculturally productive land parcels
► Dedicated financing facility for improving farmer access to low cost debt funds and
boosting commercial viability of 1-2 MW scale ground mounted Solar PV projects on
CAPEX mode INR 16,000 78,500 281 MT
crore debt fresh jobs avoided CO2 emissions

Theme: Original RE equipment Manufacturing

78 78.2 GW/Year 114 GWh/Year

Project pipeline
Policy interventions

Reimagine the ACC PLI scheme to promote local value addition via battery materials Solar cell/ Battery cell/

and impact
► Projects
recycling industry module pipeline capacity pack pipeline capacity
► Implement grand innovation challenges for solar PV and energy storage industry to
pilot and demonstrate cost effective, durable technologies made from earth abundant
materials
INR 1.48 INR 3.48 9.33 lakh
► Re-imagine solar PLI scheme to focus on manufacturing critical raw materials lakh crore equity lakh crore debt fresh jobs
(polysilicon) and upstream value chain components

Theme: EV charging infrastructure

► Promote coupling of EV charging with low–cost renewable energy systems 70 5 lakh

Project pipeline
Policy interventions

and impact
► Rationalize GST on Lithium-ion batteries to improve competitiveness of energy storage Projects EV stations
services and support emerging battery swapping industry
► Promote electric utility-driven business models for setting up
EV charging Infra
► Promote smart charging, time of day pricing, demand response and other alternate INR 1.4 15 lakh
revenue levers for EV charge point operators and investors lakh crore capital investment fresh jobs

12 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Setting the context for India’s
Energy Transition: Building
blocks and policy enablers

2
13 Accelerating India’s clean energy transition
 Self–reliance, energy efficiency and environmental sustainability are the key drivers of
India’s energy transition
As per the IEA’s ‘India Energy Outlook Primary Energy Mix (2020) Primary Energy Demand in India (disaggregated)
2021’, the primary energy mix is 100% 929 1000
currently dominated by coal and oil 880
80% 800
contributing ~44% and ~25% respectively 700
60% 600

Mtoe
in 2020. Modern renewables contribute
only ~3% of overall primary energy 40% 441 400
demand in the present scenario. The 9%
3% 20% 200
share of traditional biomass, primarily
used as cooking fuel, is gradually 0% 0
shrinking. The total primary energy 13% 2000 2010 2019 2020
Coal Oil
demand has grown at ~4% (CAGR) in the 44%
Natural Gas Traditional Biomass
last two decades. The industry, transport
Modern Renewables Transformation losses
and building sectors witnessed the 6%
highest incremental primary energy Primary Energy Demand Change in primary energy
demand in the last two decades. Coal is
demand 2000–19
the mainstay for power generation and
industrial energy use. 25% 1000 150

India’s per capita energy consumption 800

and emissions is less than half of global 100
average in the present scenario. As per 600

Mtoe
Mtoe
the ‘India Energy Statistics 2021’, net Coal Oil
energy import dependency is a whopping Natural Gas Traditional Biomass 400
50
42% and the energy intensity has been Modern Renewables Transformation losses
200
gradually reducing at 2.56% (CAGR) in
the last decade. 0 0
In the above context, energy security, 2000 2010 2019 2020 Industry Transport Buildings Agriculture
energy efficiency and environmental Transformation losses Modern Renewables Coal Oil
sustainability naturally become the key Traditional Biomass Natural Gas Electricity Bioenergy
drivers of India’s energy transition. Oil Coal Transformation losses
*Note that ‘Modern Renewables’ depicted in the charts above includes all uses of renewable energy (hydro, nuclear, solar, wind, modern biofuels etc.) with the exception of traditional use of solid biomass.
Source: IEA 2021

14 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Energy transition must prioritize equitable and affordable energy access for all to meet
economic development objectives
India’s per capita energy consumption and emissions is less than half of global average in the present scenario. This is expected to rise substantially with rapid economic development as
more people in the low income category are lifted out of poverty. The government must therefore prioritize equitable and affordable energy access for all in this transition. Further,
India’s CO2 emissions has been increasing rapidly from 0.98 billion tons in the year 2000 to ~2.5 billion tons in 2019 as per IEA 2021. Energy transition in this context should support
the decoupling of economic development and emissions intensity of primary energy consumption.

Key indicators in India as a percentage of global averages

CO2 emission per capita
Coal demand per Capita
Oil demand per Capita
Energy demand per Capita
GDP per Capita

0% 10% 20% 30% 40% 50% 60%

2000 2019

Sectorwise CO2 emissions

100% 7%
80% 33% 30%
43%
60% 18%
Mt CO2

27% 100%
93% 15%
40%
57%
20% 40% 37%
0%
Power Industry Transport Buildings Other energy &
agriculture
High income state Medium income state Low income state
Coal Plants Iron & Steel Cement Trucks 2-3 wheelers (per capita) (per capita) (per capita)
Cars Residential Services Others GDP>$10,000 $10,000>GDP>$5,000 GDP<$5,000
Source: IEA 2021
Source: IEA 2021

15 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Market outlook towards India’s energy demand and emissions indicate the speed and scale of
energy transition
As per IEA’s ‘India Energy Outlook 2021’, in the more optimistic sustainable ► The Stated Policies Scenario (STEPS) provides a balanced assessment of the
development scenario, total primary energy demand and total final consumption will see direction in which India’s energy system is heading, based on today’s policy settings
a modest growth of 7% and 13% respectively by 2030. Whereas, electricity demand will and constraints.
see a robust growth of 59% by 2030 in that scenario, largely driven by renewable
► The Sustainable Development Scenario (SDS) explores how India could mobilize an
energy sources. CO2 emissions from energy sector will contract by 4% indicating that
additional surge in clean energy investment to rapidly decline in emissions,
energy related emissions may peak in this decade. Most importantly, the share of
consistent with a longer–term drive to net zero, while accelerating progress towards
electricity in total final energy consumption is expected to rise up to 24% as
a range of other sustainable development goals.
electrification of mobility and industrial applications (fossil fuel to electricity) gains
further momentum. By 2030, Coal’s dominance in primary energy mix will end with a
Sectoral share of total final energy consumption
modest share of 46%. Low carbon gases such as compressed biogas and green
100%
hydrogen could contribute 2% of total final consumption by 2030. 11%
11% 12% 14% 13%
90%
India’s energy demand and emissions outlook
80%
3500 4 25% 22% 23%
27%
70% 35%
3000 3.5
60%

CO2 Emission (Gton)

3
2500 22%
22% 23%
2.5 50% 21%
2000 17%
2 40%
1500
1.5
30%
1000 1
20% 40% 42% 41% 43%
500 0.5 36%

0 0 10%
2019 2030 2040 2030 2040 0%
Base STEPS SDS 2019 2030 2040 2030 2040

Primary Energy Demand (MToe) Final Energy Consumption (Mtoe) Base STEPS SDS

Electricity Demand (TWh) CO2 emission (Gton: Right Axis) Industry Transport Buildings Other

Source: IEA 2021 Source: IEA 2021

16 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Increasing share of electricity in final energy consumption and gradual phasing out coal in
primary energy mix is the defining characteristic of India’s energy transition
Source wise share of total Primary energy demand ► As per the IEA India Energy Outlook 2021, share of coal in India’s primary energy mix
could reduce from 45% in the base scenario to 32% in the more optimistic SDS
100%
1%
4% scenario by 2030.
10% 9%
90% 20% ► Similarly, the share of electricity in total final energy consumption could increase
20% 15% from 17% in the base scenario to 23% in the more optimistic SDS scenario by 2030.
12%
13%
80% 2% 2% *Note that in the charts depicting primary and final energy consumption, the share of ‘bioenergy’ is decreasing and may seem
2% 2% counter intuitive in the context of energy transition. However, this includes both traditional biomass (fuelwood, animal waste,
charcoal used as cooking fuels) and other modern biofuels (bagasse, ethanol, compressed biogas etc.). The reduction in share of
6% 1% 9% 2% 15% ‘bioenergy’ for the periods 2030 & 2040 is primarily driven by continued pivot away from traditional biomass and a steady uptake
70% 4% 3% of appliances powered by electricity or other modern cooking fuels.
12%
11% Total final energy consumption
3%
60% 6% 100% 0% 0% 1% 1% 2%
26%
14% 10% 11%
27% 90% 18%
25%
50% 16%
26% 29% 80%
23%
20% 24% 30%
40% 70%
17%
60% 10%
6% 9% 11%
30% 23% 50% 12%

40%
45% 35% 36% 38%
20% 40% 34%
34% 30% 29%
32%
20%
10% 18%
10% 18% 17% 16% 18% 15%
0% 0%
2019 2030 2040 2030 2040 2019 2030 2040 2030 2040

Base STEPS SDS Base STEPS SDS

Coal Oil Natural gas Nuclear Hydro Bioenergy Other renewables Coal Oil Natural gas Electricity Bioenergy Other renewables
Source: IEA 2021 Source: IEA 2021

17 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Role of nuclear energy as base load resource needs detailed examination to accelerate
energy transition
As per CEA’s optimal generation mix report for 2030, Optimal power generation Optimal power generation
electricity demand is likely to increase to 340 GW capacity mix, 2019 capacity mix, 2030
(peak) and 2,325 BU by 2030. Nuclear energy
3%
currently contributes 2% of the capacity and 3% of 2%
energy mix. It is worthwhile to explore the role of 9%
nuclear energy as baseload resource for aiding the 55%
21%
clean energy transition through 2030 and beyond. 32%
This can reduce dependency on coal-based thermal Thermal
generation which is the mainstay of baseload 2% 64%
36%
generation in the current scenario. The government 13%
7%
should form a technical committee with relevant
2%
stakeholders to study the feasibility of this transition. 1% 17%

Electricity Demand Projection

Hydro Nuclear Renewable Sources Coal Lignite Gas Hydro Nuclear Solar Wind Biomass Coal Gas
2500 2325 400
2047 340
350 Optimal energy mix, 2030
Optimal energy mix, 2019
Peak Electricity Demand (GW)
Electricity Requirement (BU)

2000 299
300 2%
1566
226 250 3% 8%
1500 11%
200
1000 9%
150 23%
100
500
50%
50
0 0 77% 12%
2021-22 2026-27 2029-30

Electrical Energy Requirement (BU) 1%

Peak Electricity Demand (GW) Hydro Nuclear Renewable Sources Thermal Hydro Nuclear Solar Wind Biomass Coal Gas
Source: CEA 2019 Source: CEA 2019

18 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Role of Hydro Power for Grid Related Action Plan for Pumped Hydro Storage
Services to accelerate energy transition (PHS) Development
As per CEA’s optimal generation mix report for 2030, the capacity of hydro generation Till the time technology cost curve for battery storage systems improves, pumped
is expected to rise from 46209 MW in FY 21 to 71128 MW by 2029-30 [including storage will remain a viable alternative to provide grid balancing services. To develop
10151 MW of Pumped Storage Hydro plants]. It is worthwhile to expand the role of the required emphasis, developing a road map is necessary for plotting new capacities
hydro power in providing grid-related services for aiding clean energy transition. There at potential sites, which will provide the options of minimum displacement of habitats
is a need to undertake identification of reservoir and pondage-based hydro capacities and damages to ecology and environment under the categories of both ‘open loop’ and
for delivering grid security services as outlined below, drawing a monetization plan by off-river (‘closed loop’) PHS installations. Examining the scope of setting up PHS
value stacking to generate multiple revenue streams basis plant characteristics, ramp installations under existing sites with pondage and reservoir capacities is also an option
rates and pricing strategies to maintain project viability and also, providing policy inputs that may be exercised. An enabling mechanism will be the introduction of dynamic
for regulatory and market-based interventions as necessary: pricing in wholesale markets so that a monetization plan reflecting the temporal grid-
related services can be offered to PHS installations to allow commensurate cost
► flexibility services for serving peak load, diurnal and seasonal variations and acting
recovery.
as both back-up and spinning reserve
► part load operations to meet system imbalances in real time and at 5 / 15 minute and
hourly intervals
► primary response services, including frequency control and inertia, as grid ancillary
operations
► reactive power support in synchronous condenser mode operation
► black start support to power plants to restore grid outages

19 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Pumped hydro storage (PHS) projects under pipeline are critical to enhance flexibility in the
grid
As per CEA, the total hydro power Optimal hydro power PHS can store surplus renewable energy and supply electricity during peak hours continuously
generation capacity (Existing + Under generation capacity mix for 6-10 hours, depending on the storage capacity of the upper reservoir. PHS systems have a
construction + Planned) considered for lifetime of over 40 years, with roundtrip efficiency of 70 – 80%. Also, when compared to the
by 2030
optimal generation mix by 2030 is 64 GW, conventional thermal generators, PHS has a higher ramping capability (ability of quick start-
out of which ~9% is expected to be pumped stop). These features enable PHS to provide multiple services to integrate high share of
storage type. The existing capacity of hydro renewables to the grid at competitive prices. But there are challenges too, including a high initial
power projects working in pumped storage investment (USD 600- 2000/kW), topographical requirements like the range for elevation (20-
mode (>25 MW) is ~3305 MW. Another 9.0% 1000 m) between the two reservoirs, proximity to a large water body, and environmental
22.8%
~1500 MW is under active construction, impacts like loss of wildlife habitats and issues of resettlement and rehabilitation of human
~2200 MW capacity is under examination 18.6% population. The Central Electricity Authority of India has estimated a PHS potential of 96 GW,
and ~3850 MW capacity is under survey but only 3.3 GW is currently operational in India. This slow pace can be attributed to the high
and investigation where both reservoirs cost associated with the commissioning of PHS plants, the long gestation period due to delays in
exist. Similarly, ~6400 MW capacity is obtaining environmental clearances, and the low recovery from the existing pricing mechanism
under survey and investigation where one of PHS. The high cost and environmental clearance issues can be resolved using a closed-loop
reservoir needs to be constructed and PHS system that utilizes less water, has a low gestation period, and minimal impact on the
another ~6500 MW capacity where both 49.6% environment. A 2019 study by Australian National University (ANU) estimates that there are
reservoirs need to be constructed. 16,000 closed-loop PHS sites in India,
with a combined energy storage capacity of 56,000 gigawatt-hours.
PHS is a mature and scalable energy
storage technology, accounting for over Storage hydro Introduction of dynamic pricing in wholesale markets and concurrent TOD retail tariff to reflect
~90% of installed global energy storage Run off river time value of energy will be necessary to enable PHS to respond to grid-related services in real
capacity in the present scenario. PHS is a time operations and benefit from a monetization plan for cost recovery.. Today the bulk of
Multipurpose hydro
type of hydroelectric energy storage which wholesale electricity markets in India are governed by long term purchase agreements with
uses a two-reservoir system (upper and Pumped Storage hydro DISCOMs. These agreements do not differentiate the value of electricity supplied on the basis of
lower) to store energy and generate time of day and / Or season. Part of the problem is that the retail prices (end–user tariffs) are
Source: CEA 2019
electricity. It is of two types: ‘open loop’, fixed round the clock for most categories of consumers. Time of day tariffs are mandated
which is connected to a natural-water selectively for high tension category industries only with options for voluntary adoption in few
source for one or both the reservoirs; and other categories in select states. With rising share of low cost intermittent renewable energy
‘closed loop’ (or off-river PHS), which has sources supplying abundant electricity during day time and monsoon months, dynamic pricing is
no outside water bodies connected to essential for rewarding discharge of surplus/excess renewable electricity from PHS at times the
both reservoirs. grid needs most – evenings, early mornings etc. More importantly, dynamic pricing mechanisms
are essential for enhancing the arbitrage value of electricity storage.

20 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Building blocks for India’s energy transition
Decarbonization
India has set a target of 500 GW non–fossil, fuel–based energy generation by 2030 and economy wide net–zero emissions by 2070. Power sector is currently
leading the decarbonization drive with approx.105 GW of installed RE capacity dominated by Solar and wind energy sources. Another ~112 GW of RE
projects are in the pipeline under various stages of development. In the hard to abate sectors such as iron and steel, cement, chemicals, fertilizers, other
manufacturing, and transportation, there are a multitude of promising clean energy technologies (e.g., electrification enabled by heat pumps, batteries, fuel
cells and other energy storage systems, green hydrogen, biofuels such as methanol, ethanol, biogas, and bagasse) competing for transition from fossil fuels.
Energy efficiency in transformations and end–use, achieving cost parity with conventional fossil fuels will determine the speed and scale of this transition.
Decentralization
Renewable energy sources, inherently distributed in nature, can be utilized efficiently, when harnessed locally at the point of consumption. Distributed RE
generation will grow to contribute substantially more than the utility scale systems, which are constrained by land, evacuation infrastructure build out and
suboptimal capacity utilization. Energy utilities will need to rapidly embrace this transition and diversify with new business models and services in order to
remain relevant. The Government programs promoting rooftop solar PV, rural micro–grids and decentralized RE systems under PM–KUSUM will further
accelerate this transition. The centralized power grid will gradually transition from being the main source of power supply to a flexible reserve for banking
surplus energy from distributed RE systems. C&I consumers will find decentralized RE services more competitive in the immediate future. Emphasis on
evolution of grid edge technologies and compensatory frameworks will be necessary to enable large-scale onboarding of distributed energy resources in
providing grid optimization services. Going forward, value streams will be generated by offering the range of services through aggregation of decentralized
distributed resources and grouping them as Virtual Power Plants (VPP).
Digitalization
The digitalization of energy system through the deployment of information and communications technologies is gaining rapid momentum with
decentralization. This digitalization is making it easier to compute and communicate the value of energy services with finer temporal and spatial granularity.
This will enable energy demand to become increasingly responsive to changes in the prices of those services and participate actively in their provision.
Digitalization in combination with the new clean energy resources, is enabling networks to become more actively managed, potentially ending the passive
network management paradigm, in which networks are sized to meet the aggregate peak demand of passive consumers. Also, the energy utilities will need to
ramp up cyber security systems and capabilities to manage the vulnerabilities from this transition.

Aatmanirbhar Bharat
The speed and scale of India’s energy transition will rely on building robust self–reliant supply chains for critical clean energy technologies and solutions. The
Production Linked Incentives (PLI) announced for manufacturing high efficiency solar PV cells and modules, advanced chemistry battery cells and electric
vehicles are steps in the right direction to accelerate this transition. The approved list of models and manufacturers of solar PV cells and modules is
continuously evolving and expanding its scope. More importantly, India’s energy transition will leave coal and petroleum industries’, communities and
workers exposed to decline in demand for fossil fuel commodities. Understanding and addressing the social dimensions of the clean energy transition is
critical to ensure that particular communities, workers and their families are not overly disadvantaged or left behind.

21 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Ecosystem enablers: Technological advancements driving energy transition
Long Duration Battery Energy Storage – a key enabler Battery energy storage enhances large-scale renewable generation dispatching ability
in order to meet the demand which was traditionally supplied by conventional
baseload generation. By virtue of having quick discharge capabilities and round trip
efficiencies, battery storage systems can support grid balancing by participating in
wholesale capacity, energy and ancillary services markets and in particular, are an
Enables low cost effective tool for both frequency control and voltage regulation in real time
renewable operations. Additionally, they provide the benefit of capex deferral in T&D
energy to be infrastructure and is a non-wire alternative in the hands of the utility to optimize
dispatched at system and fuel costs, reduce congestion costs, firm up RE capacities against
peak times intermittencies and decarbonize the energy mix.
Replacement of Battery storage can store renewables at times of low demand and dispatch during high
thermal power “Battery on Wheels” demand periods when energy cost is high.
generation by cost as a grid resource
competitive battery Battery energy storage for stationary grid applications must evolve
storage in future beyond lithium-ion technologies for long duration storage capabilities
Battery energy
and competitiveness
storage to enable
flexibility across The stationary storage industry will need advanced chemistry battery cells enabling
power system long duration storage cycles (>15 hours per cycle), and long life (number of charge –
value chain discharge cycles) at competitive prices for boosting demand. High performance Li-ion
Virtual transactive batteries with high energy density and round trip efficiency are more suited for
Utility scale battery micro-grids for
storage brings mobility applications and less suited for multiday and beyond storage. Levelized cost
grid management of energy storage is a key performance parameter for stationary BESS solutions and
competition in the and deferring
ancillary market has to compete with levelized cost of energy from fossil fuels for scaling up adoption
investments in India. In the near future, short duration (up to 10 hours per cycle) energy storage
Behind-the- applications are likely to be satisfied with continued reduction of Li-ion batteries. In
meter markets the long term, increasing penetration of solar and wind power sources in the energy
with prosumers mix will drive development of new, ultra low cost battery chemistries made from earth
as new entrants abundant elements.

22 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Technological advancements driving energy transition: Hydrogen production nomenclature
Grey Turquoise Green Yellow
hydrogen hydrogen hydrogen hydrogen

Electricity generation from Hydrogen derived from Grid

Hydrogen in fossil fuels Natural gas wind and solar energy organic matter electricity

Partial Electrolysis Microbial Biomass Other Nuclear

Oxidation Gasification SMR ATR Pyrolysis (ALK/PEM/SOEC) Photolysis production gasification sources power

Carbon Capture Utilization and storage (CCUS)

When CO2 is
captured, grey
hydrogen becomes blue.
Power Industry Building Industry Electrolysis
generation Transportation energy Heating feedstock (ALK/PEM/SOEC)

23 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Technological advancements driving energy transition: Electrolysis for Green Hydrogen
► Hydrogen is essential to decarbonize
the hard-to-abate sectors
(manufacturing and transport), which
accounted for ~32% of India’s GHG Output
emissions in 2016.
► Industry will lead the way, while
transport and power business models
will evolve in the coming decade.
► Oil refineries using hydrogen for H2 Storage H2 Compressor
desulphurisation, ammonia
production for fertilisers and
chemicals industry, treatment of
basic metals are the leading market
opportunities for green hydrogen in Electrolyzer (DC)
the short-medium term.
► Green hydrogen technologies and
applications as alternate energy
carrier / vector for industrial process Inverter
heating, transportation and long
duration energy storage will emerge
in the long term.

Power (DC)
Hydrogen

Electricity (AC)
PV(DC) Battery (DC)
Electricity (DC)

24 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Carbon Capture, Utilization, and Storage (CCUS)
► As per the IEA, Carbon Capture,
Utilisation, and Storage (CCUS) refers to
a suite of technologies that can play an INDUSTRIAL FACILITIES INDUSTRIAL FACILITIES
important and diverse role in meeting with carbon capture and storage or utilization without carbon capture and storage
global energy and climate goals. CCUS
involves the capture of CO2 from large
point sources, including power
CO2
generation or industrial facilities that use
either fossil fuels or biomass for fuel. The
CO2 can also be captured directly from
the atmosphere. If not being used on-
site, the captured CO2 is compressed and CO2 in
transported by pipeline, ship, rail or truck
to be used in a range of applications, or
injected into deep geological formations
(including depleted oil and gas reservoirs
or saline formations) which trap the CO2
for permanent storage.
► A challenge to be overcome is to locate
appropriate geological formations and
abandoned mines / well heads which can
offer the facility of storing or CO2 in
sequestrating CO2.
Source: CEEW, 2021
► Indian industries and public sector
undertakings (PSUs) are leading the way In India, CCUS technology is far from becoming mainstream. The industry is currently exploring ways to
towards the promotion of CCUS facilities
study and improve techno-economic feasibility and scalability of this technology.
while recognizing the need to stay
carbon-neutral in the broader context of
sustainability.

25 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Tipping points for energy transition in the power sector
Levelized cost of electricity
10.0
9.1
9.0
7.7
8.0 7.4

7.0 6.3
5.7 6.6
6.0
6.3
INR/kWh

5.0 5.7
4.8 4.7
4.0 3.4 3.5

3.0

2.0 2.5
1.8
1.0

0.0
Newly built non pithead coal Newly built pit head coal Variable cost of generation Intermittent PV/Wind/PV- PV-BESS / Wind-BESS / PV- PV-BESS / Wind-BESS / PV- PV-BESS / Wind-BESS / PV-
power plant – fixed plus power plant – fixed plus from Pithead & Non-pit head Wind Hybrid (ISTS Wind-BESS (6 hours) – ISTS Wind-BESS (6 hours) – ISTS Wind-BESS (6 hours) – ISTS
variable (@50% PLF) plus variable (@50% PLF) plus coal power plant connected) connected (fully installed connected (fully installed connected (fully installed
transmission transmission BESS Capex @ $350/kWh) BESS Capex @ $250/kWh) BESS Capex @ $150/kWh)

Source: EY Analysis
Note: Fully installed BESS capex is exclusive of duties & taxes

The cost of energy storage as a service when integrated with intermittent PV/Wind/PV-Wind hybrid systems will need to reach parity with the levelized cost of procurement from
conventional baseload generation. This will determine the speed and scale of energy transition in the power sector going forward. Similarly, grey hydrogen production costs vary
approx. 75-150 INR/kg depending on the price of natural gas in the current scenario. The domestic retail CNG / PNG prices vary approx. 40-90 INR/kg, which translates to
approx. 1-2 INR/Mega Joules of energy considering the lower heating value of this fossil fuel commodity. Achieving parity with these prices will determine the speed and scale of
green hydrogen adoption in hard to abate sectors.

26 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Tipping points for energy transition in the hard to abate sectors

Cost for thermal fuel commodities in India

4.0 4

3.6
3.5 3.5

3.0 3

2.5 2.5
Cost (INR/ MJ)

2.2
2.0 2
2.0 2

1.5 1.5
1.3

1.0 0.8 1

1
0.5 0.3 0.5

0.0 0
Steam Methane Coal Gasification Biomass Alkaline LNG Retail CNG/PNG Non-Coking coal
Reforming Gasification Electrolyzer
Hydrogen Production Methods . . .

Source: DST 2020; IEA 2021; Indraprastha gas limited; National coal index (December 2021)
Note: Cost of hydrogen is exclusive of storage and transportation

27 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 India must build resilience against forces threatening the affordability of energy transition
technologies, raw materials and commodities used for domestic production
Rising cost of domestic solar PV panels could delay the pace of energy transition in Moreover, with the increase in GST rate from 5% to 12% on renewable energy equipment
India. Studies from leading market research firms show that solar module prices have (at the project level) the new effective rate of GST on wind and solar energy services
increased between 30-50% in the past two years. Some critics may attribute the rise in comes to around 13.8%. Government of India should explore reversing this increase in
solar module prices to imposition of BCD on imported PV cells (25%) and modules (40%) GST rate for providing partial relief from rising solar panel prices to the consumers.
effective from April 2022. This is not entirely accurate. As per the data compiled by a
The government of India recently announced import duty cuts for critical raw materials
leading solar PV market intelligence and research firm, solar module prices have
used in the iron, steel and plastic industries with the intention to reduce their prices for
become increasingly unpredictable and volatile since the inception of COVID in 2020.
domestic consumption. Similar interventions could be explored to provide relief for
Solar module prices (mono PERC) in the global market increased from August 2020 to
critical commodities used in Solar module manufacturing such as glass (e.g. soda ash)
November 2021 by 42%. On similar lines, solar module prices (mono PERC) in India also
and aluminium (e.g. pet coke, caustic soda), which could benefit the consumers of solar
increased from August 2020 to November 2021 by 40%.
PV panels.
One of the principal reasons behind the rising cost of solar modules is supply chain
Lithium-ion battery packs currently attract 30-40% taxes (import duty@15% and
disruptions, especially raw materials and commodities used in the manufacturing of
GST@18%) for consumers. These advanced chemistry battery packs will remain the
solar panels. Polysilicon is the critical raw material used in solar PV module
dominant technology for electrification of mobility and stationary energy storage
manufacturing. Between July 2020 and April 2022, polysilicon price in the global
applications critical for integration of intermittent renewable energy sources through
markets increased 5-6 times. Other disrupting factors in the PV module supply chain
2030. The ACC PLI scheme envisages to add 50 GWh of manufacturing capacity in the
include price hikes for commodities such as glass and basic metals (steel / aluminium),
next 2-5 years with up to 60% of local value addition. The consumers could benefit from
shortage of containers etc. Such disruptions exacerbated further due to various COVID-
immediate relief from import duties and GST rates until the domestic manufacturing
19 induced lockdowns across the world leading to halting of manufacturing activity.
capacity is established for catering to the local demand. Any safeguard duties to protect
The impact of BCD imposition on imported PV cells would taper down in the medium to the local manufacturers can be formulated in consultation with the industry.
long term term as India builds sufficient PV cell manufacturing capacity planned under
the existing solar PLI scheme. However, sustained higher cost of commodities, raw
materials (polysilicon) and logistics used in the supply chain of solar PV modules is a
major threat to energy transition. Therefore, the current solar PLI scheme must focus
on building sufficient manufacturing capacity of 98% grade silicon from quartz,
polysilicon, ingots and wafers, all critical components used in the production of solar PV
cells and modules.

28 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 50% of the energy
500 GW of Reduce the total projected Reduce 45%
COP26 commitments under requirements from Achieve net–zero
non–fossil energy carbon emission by one billion carbon intensity
Paris Climate Agreement deployment by 2030
renewable energy
tonnes by 2030 by 2030
emissions by 2070
sources by 2030

Waiver of inter-state Waiver of ISTS charges for 25 years for solar, wind, hydro PSP, BESS and green hydrogen projects
transmission charges commissioned until 2025
New policy instruments driving energy transition

Electricity (Right of Consumers)

Net metering by any Prosumer for up to 500 kW or sanctioned load whichever is lower for RTPV installations
Rules 2021

Electricity (Promotion of
Generation of Electricity from Conditions for curtailment or regulation of generation
Compensation for curtailment
Ecosystem enablers:

Must–Run Power Plant) or supply of electricity from solar, wind, hybrid, hydro
Rules, 2021

Draft Electricity (promoting

Eligibility for 100 kW and Single window procedure for grant of
renewable energy through Uniform RPO obligations on all obligated entities within
above consumers; No capacity green energy open access through a
Green Energy Open Access) distribution licensee area
limit for captive consumers central nodal agency
Rules, 2022

PLI schemes for

domestic manufacturing of INR 24,000 crores outlay for PLI scheme focusing on Advanced Chemistry Cells (ACC) Battery PLI scheme focusing on 50 GWh
high efficiency solar PV and high efficiency solar PV cells and modules of annual manufacturing capacity
ACC battery cells & modules

Electricity (Timely recovery of

costs due to change in Law) Formula for determination of impact
Mechanism for timely adjustment of tariffs
on tariffs due to change in law
Rules 2021

29 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Approved list of models 11 GW of solar PV domestic manufacturing capacity Over 1,000 enlisted models of PV modules
covered under ALMM from 39 different manufactures
and manufacturers of
Solar PV modules (ALMM)

Domestic content Government schemes including CPSU scheme, phase 2 Only models and manufacturers enlisted under ALMM will be eligible for
New policy instruments driving energy transition

requirement for government of grid connected rooftop solar program and PM– use in government projects, government assisted projects, projects under
KUSUM scheme mandate domestic content government schemes and programmes, open access and net metering
projects, assisted projects requirement for sourcing solar PV modules. projects including all projects set up for sale to government

Single window portal for facilitating

National Hydrogen Mission and Provision of 30 day banking facility to park
Waiver of ISTS charges for producers for clearances and permissions required for
surplus renewable energy in the
Green Hydrogen Policy GH2 and green ammonia manufacture, transportation, storage and
production of GH2
distribution of GH2
Ecosystem enablers:

Sustainable Alternative Target production of 15 CBG produced will be transported through Oil PSUs have offered Rs 46/- per kg basic price for
MMT of compressed biogas cascades or through pipelines to the fuel procurement of CBG meeting IS 16987:2016
Towards Affordable (CBG) from 5000 plants by station networks of Oil PSUs for marketing as standard compressed at 250 bar and delivered at
Transportation (SATAT) 2023 a green transport fuel alternative. their Retail Outlets in cascades.

Battery Swapping Policy Technical, regulatory, operations, financing, and institutional arrangements for battery swapping ecosystem
(proposed)

Raise pan-India ethanol Phased rollout of E20 from Rollout of E20 material-compliant
Phased rollout of E10
production capacity from the April 2023, its availability by and E10 engine-tuned vehicles
fuel by April 2022
current 700 to 1500 crore litres April 2025 from April 2023
Ethanol blending
Encourage use of Promote technology for the
Production of E20-tuned engine Nationwide
water-sparing crops, such as production of ethanol from non-
vehicles from April 2025 educational campaign
maize, to produce ethanol food feedstock.

30 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Frameworks for energy
demand planning and
‘JUST’ transition

3
31 Accelerating India’s clean energy transition
 Energy demand planning needs greater coordination between union and
states, especially in the electricity sector
Coordinated and harmonized framework for Institutional reforms for ‘JUST’ transition and portfolio
electricity demand planning diversification of public sector energy conglomerates JUST
The central and state level institutions involved in power system
Transition
Understanding and addressing the social dimensions of the clean
planning should coordinate more effectively and adopt integrated energy transition is critical to ensure that communities, workers Drivers
resource planning (IRP) with following assessments: and their families are not overly disadvantaged or left behind.
➢ Technology and capacity mapping for portfolio design Taking action to address the potential disparity in the economic
and social outcomes from the inevitable transition can be labelled a
➢ Developing demand scenarios net of DER / DR / DSM impacts with just or equitable transition. Globally, there is a growing recognition
Protecting
inputs from States, aggregating at regional / national levels and among institutional investors that these social considerations livelihoods
merging the data sets under EPS should form part of their broader response to the risks and
➢ Drawing the framework of resource adequacy for load-generation opportunities inherent in the net zero transition.
balance on hour-on-hour, year-on-year and aggregated basis India’s clean energy transition will leave coal and petroleum
industries, communities and workers exposed to decline in demand Social
➢ Providing broad guidance for transmission planning, network
strengthening and corridor identification, including juxtaposition for fossil fuel commodities. There are ~1.2 million workers in inclusion
of green corridors India’s coal sector, including employees of CIL and private
producers, as well as informal workers in the mining and
Robust and predictable growth in demand for clean energy sources is generation sectors, but excluding those from coal transport, which
essential for accelerating energy transition investments. There is a comprises both rail and road transport. Coal accounts for ~40% of Balancing
need to restructure the framework for electricity demand planning, India’s rail network revenue and the rail sector formally employs winners and
especially at the State level in order to enhance coordination and 1.3 million people. The coal trucking industry hires about 0.5 losers
harmonization of techniques and reporting with greater degree of million people: truck drivers, coal loaders, and maintenance
granularity. States must focus on conducting least cost generation workers for around 150,000 trucks. Clustered around these core
expansion planning backed by optimal dispatch simulation at an activities are substantial secondary employment opportunities in
hourly resolution for spot years (e.g., 2025/2030/2040). Such both the formal and informal sectors. Much of this employment is Repurposing
planning should also be accompanied by modelling network focused in coal-producing states consisting of Jharkhand, Odisha, assets
constraints and grid stability analysis for validating integration of Chhattisgarh, West Bengal, Madhya Pradesh, and Telangana. It is
high shares of renewable energy for spot years. estimated that for every formal job in coal, 3–10 additional
jobs/livelihoods are dependent on coal in the coal mining districts.

32 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Economic diversification in coal-dependent communities and business
diversification of coal/petroleum industries can accelerate JUST transition
In an article titled ‘Bureaucracies for the Better’ authored by an expert, it is argued that the Estimated potential of renewable energy (MW)
energy transition policies and technologies, new business models, have been converging for Coal dependent
some time in India with electricity as a common-denominator. The existing institutional states in focus Solar (Ground +
Small Hydro Power Wind
framework governing India’s energy sector faces conflicting incentives. The problem of Rooftop)
conflicting incentives at the institutional level is acute at India’s Ministry of Coal, which has Jharkhand 18,180 228 -
the mandate to ensure that enough of the black rock is mined domestically to continue
feeding India’s growing electricity demand. Meeting these targets provides essential income to West Bengal 6,260 392 2
central and state governments, while also carrying both revenue and purpose to other Madhya Pradesh 61,660 820 10,484
connected public sector corporations, like Indian Railways, the NTPC, and Coal India Limited,
the mining conglomerate that controls 90% of coal reserves in the country. But this model is Maharashtra 64,320 786 45,394
unsustainable. Chhattisgarh 18,270 1,098 77
Indian railways has already achieved great strides in electrifying its network, adoption of
Source: MOSPI, 2021
renewable energy for captive use and also announced its ambition to achieve net zero
emissions by 2030. NTPC and Coal India both are pursuing renewable energy investments
aggressively to diversify their portfolio and reduce the risk of locking in fossil fuel investment. Reserves of Reserves of Reserves of
The Indian Oil Corporation is pursuing rapid solarization of fuel retail stations, considering State
Nickel Ore Cobalt Ore Molybdenum Ore
adding EV charging at thousands of locations, and has started venturing into the hydrogen
space. Bharat Heavy Electricals Limited, the largest power generation equipment Odisha 175 million tons 31 million tons -
manufacturing firm, has announced plans to making components for EV charging
infrastructure and renewable energy value chain that the country so desperately needs. Jharkhand 9 million tons 9 million tons -
Renewable power generation, green hydrogen production, storage and transportation,
upstream manufacturing of polysilicon wafers, ingots, mining of critical minerals essential for Nagaland 5 million tons 5 million tons -
energy transition such as nickel, cobalt, molybdenum, chemical processing for production of
advanced chemistry battery cathodes etc. are the emerging value chains for business
Tamil Nadu - - 10 million tons
diversification for energy conglomerates. In summary, policy packages should determine
JUST Transition pathways and a governance structure with adequate institutional capacity to Madhya
implement the measures. A whole-of-government approach will be necessary involving - - 8 million tons
Pradesh
dialogues at the Central, State and local government levels and actively engaging with
communities, labour unions and civil society organizations in order to ensure that re-skilling, Karnataka - - 1.32 million tons
redeployment and realignment of livelihoods follow an orderly direction and have broad public
acceptance. Source: Indian Bureau of Mines, 2019

33 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Incentives for fossil to electricity transition technologies and solutions for
manufacturing industries can accelerate inorganic demand growth for electricity
For the manufacturing industries, renewable powered electric heat pumps, boilers and electric Vision for a renewable electricity
arc furnaces could replace fossil fuel furnaces for process low-medium temperature powered cement ecosystem H2
applications . However, total decarbonization of this sector, particularly that requires high- to industry
grade heat may be difficult purely by means of electrification. This challenge could be
addressed by green hydrogen produced from renewables.
As per CEEW analysis in 2019, the green hydrogen based steel production would support
scaling up of production in meeting the strong domestic demand and provide for about 4 Combustion Heat
million direct manufacturing jobs by 2050. Further, it would create another 1.6 million jobs
along the hydrogen supply chain, far replacing the fewer jobs involved only in the import and
transport of coking coal. Supporting transition of the domestic cement manufacturing to low- Electricity Pure
carbon cement would ensure that the sector would support 0.54 million jobs in 2050, and zero CO2
import dependency on limestone imports. In 2019, MIT researchers demonstrated an Hydrogen
Fuel cell
electrochemical processes for low carbon cement manufacturing. The new process centers on
the use of an electrolyzer, in which oxygen-evolving electrode produces acid, while the Oxygen + CO2
hydrogen-evolving electrode produces a base. In the new process, the pulverized limestone is
dissolved in the acid at one electrode and high-purity carbon dioxide is released, while calcium
hydroxide, generally known as lime, precipitates out as a solid at the other. The calcium Liquid fuels
Water CaCO2
hydroxide can then be processed in another step to produce the cement, which is mostly
calcium silicate. The carbon dioxide, in the form of a pure, concentrated stream, can then be
easily sequestered, harnessed to produce value-added products such as a liquid fuel to replace CCS
gasoline, or used for applications such as oil recovery or even in carbonated beverages and
dry ice. CO2U

To provide the required fillip for investments in transitioning to carbon-neutral processes, it CA(OH)2 EOR
will be important to develop and scale voluntary carbon markets by incentivizing target
industries to opt in till such time a mandatory carbon market is introduced in the economy. Oxyfuel
The measure may prove critical to maintaining the competitiveness of Indian industries if the Aluminosilicates
Heat
proposal of introducing ‘Carbon Border Adjustment Tax’ is implemented by EU and its member
countries. Secondly, to unlock the potential in energy-intensive industries, government Cement
facilitation will be necessary to support R&D in low carbon technologies as well as develop the
Source: MIT Energy Initiative
framework for innovative financing, institute credit enhancement and partial risk guarantee
mechanisms and deploy public funds to attract private capital at scale.

34 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Other measures to enable clean energy demand growth

Reforms to improve financial health of electricity distribution sector

The central financial assistance to state power utilities for promoting performance improvement and reforms should be
conditioned upon implementation of Direct Benefit Transfer, corporate governance, and recovery of government outstanding
to DISCOMs – both subsidy and electricity dues. Structural reforms separating carriage and content should be a priority to
improve last mile efficiencies and governance structure, facilitate consumer empowerment and provide the effective interface
for decentralized distributed generation.

Formulate a national policy framework for coal plant and mine closures / phase out
The Ministry of Power should formulate a national policy framework for coal plant and mine closures / phase out by adopting
JUST transition principles for all. The framework should include provisions for using land, water, existing transmission
networks and re-skilling employees for building and operations of renewable energy facilities. Feasibility of repurposing end-
of-life coal-based power plants should also be examined for on-site deployment of either stand-alone or a combination of solar
panels, battery storage and synchronous condensers upon assessment of economic benefits and social trade-offs.

Formulate energy storage policy with viability gap funding for initial uptake

The stationary storage industry can compromise on energy density and round trip efficiency of advanced chemistry battery
cells if other performance parameters such as long duration storage (>20 hours per cycle), and useful life (no. of charge –
discharge cycles) are superior to existing technologies at competitive prices. The levelized cost of energy storage is a key
performance parameter for stationary ESS solutions as they have to compete with levelized cost of energy from fossil fuels for
scaling up adoption in India. In this regard, energy storage policy must look beyond lithium-ion technology and focus on
development of cost effective long duration capable advanced chemistry battery cells made from earth abundant elements.
Viability gap funding should be provisioned for initial uptake and demonstration of cost-effective technologies.

New regulatory paradigms

New regulatory paradigms will be necessary to usher in the concepts of utility engagement in decentralized service models and
demand side measures, dynamic pricing in wholesale power markets to monetize grid-related services and build value streams,
expanded application of TOD retail tariff and aggregation of distributed energy resources for providing grid-interactive
services. A prudent approach will be to set up Regulatory Sand Boxes for testing these concepts and providing the basis for
informed decision making.

35 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Decarbonizing India’s
electricity grid with utility
scale RE power generation

4
36 Accelerating India’s clean energy transition
 Shovel-ready pipeline of utility scale RE power generation projects
India’s renewable energy (RE) based grid interactive power generation capacity has
increased ~7 times since 2010 taking the cumulative installed capacity to ~104 GWp
(as of December 2021). Wind and solar PV constitute 48.55 GWp and 40.03 GWp of
the installed power generation capacity respectively in the current scenario. So far in
the current fiscal (FY 22), India has commissioned ~10.6 GW of renewable power
generation capacity with another quarter remaining. India is also leading the global
transition towards renewable energy with initiatives such as ‘One Sun One World One
Grid’ and ‘World Solar Bank’ for harnessing solar energy on a global scale. Contracted capacity of utility scale RE power generation projects in pipeline (MW)

There are over 360 utility scale RE based power generation projects in the pipeline led Project announcement year Total
RE Technology
by both public and private sector. These projects include solar PV, wind, biomass, 2018 2019 2020 2021 2022* (MW)
battery energy storage systems (BESS) and hybrid RE projects under different stages
of development. Together these projects constitute ~103 GW of contracted capacity Biomass 6 15 40 61
in the pipeline. Floating solar 170 70 34 1,045 360 1,679
Hybrid (Solar +wind) 840 1,820 2,395 2,900 750 8,705
Open access 170 45 7,172 866 8,253
Over ~37.6 GW of utility scale RE power generation projects in the pipeline currently RE + Storage 1,200 20 146 1,366
was announced / tendered / auctioned in the year 2021. In recent times, the scale of
Hybrid RE projects announced has increased, indicating that the demand for Hybrid Solar PV 1,390 17,508 9,764 21,336 10,961 60,959
projects is gaining rapid momentum. By blending solar PV, and wind energy sources at
Storage 1,000 6,490 7,490
a single location or multiple different locations/injection points in the national grid,
Electricity Distribution Companies (DISCOMs) / bulk buyers can better manage the Wind 5,725 1,423 4,058 3,045 14,251
intermittency / variability otherwise associated with plain vanilla RE projects. BESS
Grand Total 8,125 22,197 12,258 37,672 22,512 1,02,764
projects are increasingly announced to integrate high share of variable/intermittent
renewable energy sources into the grid. Open access RE projects are increasingly Source: EY Analysis based on JMK Research; *Only projects announced in Jan’22 is included
adopted by corporates and businesses for optimising power purchase costs, build
resilience from climate change impacts and further accelerate towards net zero
emissions. The ease of doing open access RE projects has improved significantly over
the last one year, which is another key contributing factor.

37 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Contracted capacity of utility scale RE power generation projects in pipeline (MW) A majority of Solar PV projects are in different stages
of permitting — signing power purchase agreement
Project pipeline status* Total
RE Technology (PPA), power sale agreement (PSA), tariff adoption
Announced Permitting Under Construction (MW) and power procurement approvals from regulators,
financial closure, land acquisition and permission for
Biomass 61 61
grid interconnection. Whereas, a majority of Hybrid
Floating solar 890 444 345 1,679 RE projects and BESS projects are yet to complete
price discovery through reverse auctions. About 23
Hybrid (Solar +wind) 1,950 4,270 2,485 8,705
GW of projects have progressed to construction stage
Open access 4,540 605 3,108 8,253 which includes ~7 GW of wind power projects
auctioned over the years. This indicates that India will
RE + Storage 111 1,220 35 1,366
add significant capacity of wind power projects in the
Solar PV 16,717 34,269 9,973 60,959 next fiscal. Reforms focusing on improving ease of
land acquisition for low carbon infrastructure
Storage 7,490 7,490
projects, grid connectivity and open access will
Wind 4,545 2,558 7,148 14,251 determine the speed and scale of transition.
Grand Total 36,304 43,366 23,094 1,02,764 ~6.8 GWh of utility scale BESS is in the pipeline, most
of which are undergoing the reverse auction process
Source: EY Analysis based on JMK Research
for competitive price discovery. The CEA in its
optimal generation mix report for FY 2029–30 has
Current status of utility scale RE projects in pipeline estimated all India BESS capacity addition of 34MW /
136 GWh by end of this decade. Most of the MWh
100%
scale BESS projects under pipeline aim to provide
80% renewable energy integrated with BESS as a service
in remote areas of Leh, Chhattisgarh, UP etc.
60% Whereas, the recently announced GWh scale
standalone BESS projects aim to provide round the
40%
clock (RTC) renewable energy as a service and also
20% optimise capacity utilisation of ISTS (transmission
system) set up for RE integration.
0%
Biomass Floating solar Hybrid (Solar Open access RE + Storage Solar PV Storage Wind Therefore, the top use cases emerging of standalone
+wind) BESS projects are RE firming, RTC RE supply and
better capacity utilisation of transmission systems
Announced Permitting Under-construction connecting massive RE projects to national grid.

Source: EY Analysis based on JMK Research

38 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

Utility Scale BESS Project Pipeline

Project BESS capacity

Project name or scheme Date of
capacity (contracted) Project Location
(Auction / Tender) announcement
(MW AC) (MWh AC)

GSECL 35 MW with 57 MWh BESS

Sep-2021 35 57 GUJARAT
Solar(EPC) Gujarat

NIT for procurement of 2,000 MWh

Jul-2021 1,000 2000 PAN INDIA
battery energy storage system

NTPC 4 MW Solar (EPC) + 1 MW/1

Jun-2021 4 1 UTTAR PRADESH
MWh BESS Uttar Pradesh

REMCL Solar with 7 MW/ 14 MWh

May-2021 7 14 MAHARASHTRA
BESS Maharashtra (Railway Land)

SECI 100 MW Solar with 50MW/120

Dec-2021 100 120 CHHATTISGARH
MWh BESS Storage Chhattisgarh

SECI 20 MW Solar with 20 MW/ 50

Dec-2020 20 50 LADAKH
MWh BESS Storage Leh

SECI, 1,200 MW, ISTS -Tranche VII,

Aug-2019 900 - PAN INDIA
RE with storage

SECI, 1,200 MW, ISTS -Tranche VII,

Aug-2019 300 - PAN INDIA
RE with storage

NTPC 500 MW MW with 3000 MWh

Jan-22 500 3000 PAN INDIA
ESS Pan India

SECI 500 MW with 1000 MWh BESS

Apr-22 500 1000 RAJASTHAN
Rajasthan

NTPC 10 MW/40 MWh BESS (EPC)

Apr-22 10 40 TELANGANA
Telangana

NTPC 250 MW with 500 MWh BESS

Apr-22 250 500 RAJASTHAN
Rajasthan

5230 MW Renewable Energy Storage

Oct-22 5,230 - ANDHRA PRADESH
Project in AP

Source: EY Analysis based on JMK Research

39 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

Project location for utility scale RE power generation capacity in pipeline S. States/
Solar Wind Storage PPA executed capacity in pipeline (MW)
capacity capacity capacity RE Technology Total (MW)
No UTs
(MW) (MW) (MWh)
Rajasthan, Gujarat, Maharashtra, Uttar Pradesh and Floating solar 240
Madhya Pradesh are the top five states emerging Andaman &
1 4 Hybrid (Solar +wind) 6,255
Nicobar islands
for siting utility scale RE power generation projects Open access 1,198
12 in the pipeline (refer graphic with serial number for 2 Assam 25
Solar PV 24,981
corresponding state). 3 Bihar 230 Wind 8,348
PAN India projects whose locations are yet not finalized 4 Chhattisgarh 1,278 120 Grand Total 41,022
17 Solar: 31, 474 MW; Wind: 10,044 MW; Storage: 5,000 MWh
5 Goa 70
8
7 6 Gujarat 6,750 4,401 57

7 Haryana 120
21 2
18 8 Himachal Pradesh 15
3
15 9 Jharkhand 130
9 10 Karnataka 2,230 480
6 13 22
4 11 Kerala 320

16 12 Ladakh 20 50
14 13 Madhya Pradesh 3,005 638
20 14 Maharashtra 5,837 1,595 14

15 Nagaland 20
5
16 Odisha 150
10
17 Punjab 1,150

18 Rajasthan 19,618 1,580 1500

19 19 Tamil Nadu 1,150 352

11
1 20 Telangana 285 40
21 Uttar Pradesh 2,737 1

Source: EY Analysis based on JMK Research

22 West Bengal 105

40 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Investment mobilization Employment potential
Utility scale RE projects in pipeline would need INR ~3.73 lakh crore (US$ ~48 billion, 1 ~7.93 lakh fresh jobs will be created for operationalizing the 103 GW pipeline of utility
INR = 0.013 US$) of capital infusion for operationalization. This translates into INR1.12 scale RE projects. 52% of total jobs would be local job pertaining to project planning,
lakh crores (US$ ~14.1 billion) of equity infusion and INR2.61 lakh crores (US$ ~33.6 O&M and commercial, whereas 48% would be supply chain jobs catering manufacturing,
billion) of debt infusion at 30:70 ratio. Much of this capital infusion is expected from the transportation and decommissioning.
private sector increasingly backed by private equity investors, sovereign wealth funds
and other specialised institutional investors.

Capital Investment – Equity Capital Investment – Debt

Fresh jobs created
~INR 1,11,902 crores ~INR 2,61,105 crores ~ 7,92,747 jobs
For 103 GW of Utility scale For 103 GW of Utility scale
For 103 GW of Utility scale RE projects in pipeline
RE projects in pipeline RE projects in pipeline

Capital infusion for utility scale RE projects in pipeline (INR crores) Fresh jobs created from utility scale RE projects in pipeline
Estimated Viability gap Equity Debt Total no. of
RE technology RE technology
CAPEX outlay funding Mobilisation financing Fresh Jobs
Biomass 1,098 329 769 Biomass 2,623
Floating solar 5,877 1,763 4,114 Floating solar 15,217
Hybrid (Solar +wind) 39,546 11,864 27,682 Hybrid (Solar +wind) 65,262
Open access 29,166 8,750 20,416 Open access 74,033
RE + Storage 5,144 1,543 3,601 RE + Storage 12,381
Solar PV 2,13,357 2,244 63,334 1,47,779 Solar PV 5,52,492
Storage 9,810 2,943 6,867 Wind 70,739
Wind 71,254 21,376 49,877 Grand Total 7,92,747
Grand Total 3,75,251 2,244 1,11,902 2,61,105
Source: EY Analysis based on JMK Research

41 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Environmental benefits
~4 billion tonnes of cumulative CO2 e emissions can be
avoided over a lifetime of 103 GW capacity of grid
connected utility scale RE projects.

Avoided CO2 emissions (cumulative over project lifetime)

~3,989 million tonnes CO2e

For 103 GW of Utility scale RE projects in pipeline

1.7% 1.4%

10.4% 8.2% 60.5% 17.7%

0.2%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Biomass Floating solar Hybrid (Solar +wind) Open access RE + Storage Solar PV Wind
Source: EY Analysis based on JMK Research

42 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 1. Establish a national index along with regional sub-indices for However, there is lack of uniform approach for states with abundant wasteland
RE pricing by pooling of prices / tariffs discovered from RE resources to allocate such land among RE developers by way of a transparent
competitive mechanism. MNRE scheme for development of ultra mega RE power
auctions parks could embed such mechanisms for development and implementation of
projects. There is a need to formulate and implement uniform land acquisition
Many utility scale RE projects in the pipeline remain stranded without PPAs
policy with provision of single window clearance mechanism for projects
even after completing price discovery through auctions and this scenario is
awarded through auctions conducted by central PSUs as intermediary off-
likely to persist. This is largely because the DISCOMs, who are the ultimate
takers. Simultaneously, the model policy could also specify the framework for
buyers of renewable electricity from these projects, expect the tariffs to fall
aggregation of large privately owned wasteland parcels with right incentives for
perpetually as a function of time and therefore delay signing power supply
landowners to lease their assets for development of ultra mega RE power parks.
agreements hoping to find better deals from future auctions. One way to
address this challenge is that the central PSUs, which plan and conduct 3. Dynamic pricing in wholesale markets and expanded scope of
renewable energy auctions as intermediary off-takers can take in principle TOD retail tariff necessary for creating commercially attractive
approval from the DISCOMs, agreeing on acceptable range for tariff discovery. use cases for deployment of utility scale BESS
The same agreement can be captured in the Tariff filing applications submitted
Recommendations

to respective state regulatory commissions. This would enable the timely Today the bulk of wholesale electricity markets in India are governed by long
execution of Power Sale Agreements. term purchase agreements with DISCOMs. These agreements do not
differentiate the value of electricity supplied on the basis of time of day and / Or
Also, in this context, pooling of prices/tariffs discovered from multiple season. Part of the problem is that the retail prices (end–user tariffs) are fixed
auctions conducted over a pre–defined period could help both buyers and round the clock for most categories of consumers. Time of day tariffs are
sellers with a single benchmark cost for negotiating PPAs and PSAs. SECI and mandated selectively for high tension category industries only with options for
other central PSUs acting as intermediary off–takers can collaborate to voluntary adoption in few other categories in select states. Lack of smart
formulate a national index with regional sub-indices based on pooling of metering infrastructure is another key bottleneck in this regard to enable time
prices/tariffs discovered from multiple RE auctions. Such an index will help of day pricing. Advanced Metering Infrastructure (AMI) of smart meters increase
periodically benchmark the competitive price / tariff for RE based power opportunities for implementing TOD tariff, enabling multiple pricing options to
generation and guide negotiations for PPA signing between parties. Such an be offered to customer.
index will also help investors and financial institutions inform their outlook and
evaluation of utility scale RE projects. The central government has notified the timelines for replacement of existing
meters with smart meters with prepayment features. By 2023, a significant
2. Formulate a model policy for aggregation and allocation of number of urbanized states and UTs with high AT&C losses (>15%) is expected
wasteland parcels for the development of ultra mega utility to replace, whereas remaining states may take until March 2025 for the same.
With rising share of low cost intermittent renewable energy sources supplying
scale RE power parks
abundant electricity during day time and monsoon months, dynamic pricing is
Access to contiguous land parcels is still a challenge for the development of essential for rewarding discharge of surplus/excess renewable electricity from
Megawatt scale RE projects in several states. Wasteland categories like land BESS at times the grid needs most – evenings, early mornings etc. More
with dense scrub, land with open scrub, shifting cultivation, degraded importantly, dynamic and time variant pricing mechanisms are essential for
pastures/grazing land, degraded land under plantation crop may be good fit enhancing the arbitrage value of electricity storage. Dynamic time variant tariffs
for development of RE projects. are key to maximize the profitability of BESS projects and investments.

43 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 4. Implementation of the Electricity Amendment Bill 2021 6. Retrofitting / repowering existing solar and wind power
installations
The draft ‘Electricity Amendment Bill 2021’ is welcomed by the industry in
its present form and can be a game changer in transforming the power In order to ramp up solar and wind energy generation at existing sites
sector to become more investor friendly by improving ease of doing which provide the option of replacing vintage generating plants with
business, enforcement of contracts, cost reflective tariffs, direct benefit equipment deploying advanced technology and resulting in higher CUF,
transfer of subsidies, national renewable energy policy, strengthening of following measures are relevant:
institutions such as APTEL and electricity regulatory commissions,
expansion of NLDC functions etc. a. Examine the scope for retrofitting end-of-life solar power plants with
new technology options to improve efficiency, by application of:
The implementation of ‘Electricity Amendment Bill 2021’ will likely boost
the investor confidence for driving energy transition investments and ► dual Axis Active Solar Trackers for increasing generation
galvanise the full spectrum of stakeholders in the power sector for a better ► silicon based Passivated Emitter and Rear Cell (PERC) panels having high
future. purity to improve cell efficiency
Recommendations

► bifacial solar cells to increase generation

5. Scale up skilling and training efforts to boost availability of
skilled professionals for project execution ► half cells panels to improve overall module durability

Over the years, the government of India through ‘Skill Council for Green b. Identify wind power projects / capacities to be augmented by repowering
Jobs’ has scaled up skilling and training activities for the youth of India to and initiate following activities:
support the industry’s ambition and investments towards energy transition. ► selecting sites that would maximize harnessing of wind resources
Occupational mapping, skill gap analysis, development of qualification
packs for various job roles expected from energy transition investments, ► choosing appropriate designs to improve the power output, viz. rotor
curriculum and courseware development, strengthening the quality of height and diameter, turbine capacity etc.
training infrastructure, certification of candidates, improving linkages with ► assessing site constraints / ROW and enablers for refurbishing
industry for job placements are all streamlined for better outcomes.
c. Repositioning the solar and wind installations with higher capacity and
Given the scale of energy transition investment pipeline and resulting output efficiency would entail addressing commercial arrangement, viz.:
employment potential, the above activities will need to be ramped up
involving the academia, industry, civil society organisations and other ► framework for bidding / rebidding
partners. A comprehensive monitoring and evaluation framework focusing ► termination clause / recompensing provisions for incumbent developers
on meeting the industry needs, improving livelihoods and other positive
socio-economic outcomes should be adopted for the skilling and training ► off-take arrangement with buyers
activities and programs.

44 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 7. Policy Coordination and Implementation 8. Project Monitoring

Integrative approach between MOP and MNRE will be necessary at apex level To reinforce inter-ministerial coordination, an Apex Body under aegis of MOP and
for synchronizing technology selection, resource allocation and capacity MNRE can be formed to monitor project implementation and develop work plans
addition plans. In particular, following tasks are important: for addressing:
► ensuring cross-sector linkages and policy coordination ► build-up of domestic manufacturing
► enshrining the six pillars of PM Gati Shakti and removing the silos for ► design of fiscal incentives and their applicability
portfolio expansion – comprehensiveness, prioritisation, optimization,
► technology upgrades and collaborations
synchronization, critical analysis, and dynamic review
► raw material sourcing and supply chain issues
► driving synergies of objectives and tasks across GOI initiatives, viz. National
Energy Solar Mission, National Hydrogen Mission, National Energy Storage ► streamlined project clearances and approvals
Mission, etc.
► policy support for project finance, planning and implementation
Recommendations

► aligning incentive schemes for providing impetus under domestic

manufacturing and supporting R&D to facilitate technology adaptation / Joint Working Groups (JWGs) under MOP and MNRE are proposed to enable
collaboration / partnerships knowledge exchange, support work plans basis identified projects and facilitate a
coordinated approach across the full spectrum of technology deployment,
► addressing supply chain constraints and removing the bottlenecks, project development and capacity expansion.
encompassing technology upgrade, raw material sourcing, import options
and strategic investments, e.g. positioning technology for solar cells, A dedicated Project Monitoring Panel is suggested for reviewing progress of
electrolysers, etc., and minerals including rare earth metals for advanced projects under implementation, including but not limited to those under thermal,
chemistry battery cells hydro including pumped storage, renewables and BESS categories. It will act as
► channelizing project finance by introducing appropriate schemes under the effective interface between the Working Groups, the Apex Body and the
credit enhancement mechanism, partial risk guarantees, first loss administrative Ministries for addressing project-specific bottlenecks and fast-
guarantees, etc. and leveraging public / blended finance for attracting tracking execution, as will be necessary.
private capital.

45 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Decentralization of
power system through
distributed generation

5
46 Accelerating India’s clean energy transition
 Shovel-ready pipeline of grid connected rooftop PV (RTPV)
projects in residential, commercial and institutional sectors
Introduction Pipeline Capacity (MW)
RTPV markets in India witnessed the highest ever capacity addition (~2654 MW) in the last calendar year 2021.The states
of Gujarat, Maharashtra and Kerala are leading the RTPV capacity addition growth in the country. The Ministry of New and Bihar 23
Renewable Energy (MNRE) has launched Grid Connected Solar Rooftop Program – Phase 2 in August 2019. The
Component–A of this program aims to deploy 4 GW of RTPV systems in the Residential Sector with Central Financial Chandigarh 32
Assistance (CFA) up to 40%. Approximately ~3.2 GW RTPV capacity is already allocated by MNRE for implementation in
NCT of Delhi 34
various states. Whereas the Component–B aims to incentivize state DISCOMs for performance that is evaluated by
incremental RTPV capacity addition (up to 18 GW) in any sector.
Karnataka 40
Shovel ready projects for implementation Haryana 30
~2.0 GW of RTPV capacity in residential and ~144 MW in C&I segments is currently under pipeline. Approximately, 1.2 GW
Madhya Pradesh 46
of RTPV has been commissioned under the MNRE scheme as of January 2022. CAPEX model of development is currently
dominating the project pipeline under both components. Whereas, Renewable Energy Service Company (RESCO) model of
West bengal 60
development leveraging private sector investments is increasingly tested for faster adoption. A variety of other innovative
business models such as rent a roof/lease model, community model, utility model through a Special Purpose Vehicle (SPV), Telangana 58
plug–in Rooftop Solar (RTS) model and others are also being explored. Currently Gujarat is leading in pipeline capacity for
rooftop projects with 947 MW followed by Kerala and Maharashtra with 249 and 132 MW respectively. Punjab 66

Simplified procedure for RTPV installations under MNRE scheme, Jan 2022 Uttar pradesh 75
A national portal for registering applications from the beneficiaries, approvals thereof and tracking progress will be Rajasthan 66
developed. Further, the beneficiary can install RTPV systems from any vendor fulfilling the conditions of DCR, enlistment
under ALMM and inverters certified by BIS. Model standards and agreements for supply with vendors will be notified. This Maharashtra 132
will significantly improve ease of doing RTPV across the country.
Kerala 249
Electricity (Right of Consumers) Amendment Rules 2021
Gujarat 947
These rules allowed up to 500 kW Or sanctioned load whichever is lower for RTPV installations availing net metering by any
Prosumer. This is a significant policy driver for accelerating RTPV project pipelines across the country when properly 0 200 400 600 800 1000
enforced by state electricity regulatory commissions.

47 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Investment Investment mobilization for allocated Socio economic benefits

projects in residential, commercial

mobilization capacity (INR crores) – Component A Over 18,000 fresh jobs will be created in building
For the allocated 6000 2.0 GW capacity of grid connected RTPV systems
capacity of 2.0 GW under the program. These jobs will emerge in both
under development, public and private sectors along the value chain of

connected rooftop PV (RTPV)

project development, construction and

Shovel-ready pipeline of grid

~INR 3,042 crores (US$ 5000
~0.4 billion) of capital 3346 commissioning, operations and maintenance of
investment will be rooftop solar PV systems all across the country.
mobilized (excluding the 4000

and institutional sectors

subsidy). Further,
another INR 1,259 Fresh jobs created
crores (US$ ~0.2 billion) 3000
is expected to be ~18 thousand jobs
mobilized for building For 2.0 GW of current allocation
2000 2129
the remaining capacity under Phase II component A
announced under the
MNRE program. The 1000
Government of India
through MNRE could 913 Environmental benefits
provide total capital 0 Over ~80 million tonnes of CO2e emissions are
subsidies of ~INR 6,600 expected to be avoided over the operating lifetime
crores (US$ ~0.9 billion) of 2.0 GW capacity of grid connected RTPV projects
Equity Mobilisation Debt Financiny Capital Subsidy
under component A. Source: EY analysis based on MNRE SPIN portal commissioned under the program.

Avoided emissions
Capital Investment – Equity Capital Investment – Debt
(cumulative over project lifetime)
~INR 913 crores ~INR 2,129 crores ~80 million tonnes CO2e
For 2.0 GW of current allocation For 2.0 GW of current allocation
For 2.0 GW of current allocation
under Phase II component A under Phase II component A
under Phase II component A

48 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 1. Adopt best practices from Gujarat and Kerala models of scaling up 2. Frame policy and regulatory incentives to
RTPV implementation in residential sector promote utility owned / driven business
models for RTPV capacity addition
We examined the ratio of commissioned RTPV capacity to allocated capacity by MNRE in order to
benchmark the progress in each state. Before current allocations by MNRE, Gujarat had achieved
Under the Grid connected Rooftop Solar Program –
83% of its allocated capacity of ~1.2 GW. States such as Rajasthan, Haryana and Telangana
phase 2 component A, most of the DISCOMs have largely
achieved between 40%–50%, whereas other moderately performing states namely Uttarakhand,
adopted the consumer owned model with utility acting as
MP and UP achieved 20–30% of allocation.
an aggregator to implement the sanctioned RTPV
In our opinion, Gujarat has shown tremendous progress because of following interventions: capacity. Going forward, DISCOMs must look beyond
► Additional subsidy sponsored from state up to 10kW projects consumer owned models to attract more households,
► A unified web portal for processing consumer RTPV applications, single window approvals especially in the lower slabs of consumption (less than
and tracking 100 units per month).
► No capping of the RTPV capacity with respect to sanctioned load
Kerala State Electricity Board (KSEB) has successfully
► Reduction of security deposit payable by developer to the DISCOM from 25 Lakhs to 5 Lakhs
aggregated over 200 MW of RTPV demand from
Recommendations

► Banking charges, cross subsidy and additional surcharge exempted for residential prosumers
households in the lower slabs of consumption by offering
► Consumer awareness and outreach programs
compensation for access to roof space in the form of
Commissioned out of allocated Allocated and commissioned monthly energy credit. DISCOMs in other states must
capacity till December 2021 capacity (MW) take a cue from this success and act fast to unlock value
in the RTPV market. Perceived threats from revenue loss
Uttar pradesh 23% 3500 can be turned into a growth opportunity if DISCOMs
channel their CAPEX into supplying RTPV electricity to
Madhya Pradesh 26% 3000 individual households.
2500 1222 Changes in regulatory paradigm will be necessary to
Uttarakhand 37% incentivize DISCOMs to partake in decentralized
2000 generation activity and provide the platform for system
Telangana 41% integration by investing in grid-edge technologies
1500
requiring advanced computational power and
Haryana 47% 1000 1939 141 optimization modelling software. An earning adjustment
mechanism linking revenue to efficiency targets is a
Rajasthan 49% 500 992 measure implemented in other jurisdictions that
compensates DISCOMs against flat-to-declining load
0 growth and provides for recovery of programme
Gujarat 83%
Allocated Commission
expenses and lost distribution revenue as well as a share
Source: EY analysis Gujarat allocation Rest states combined of the net economic benefits and / or a rate of return on
capex in non-wire solutions.

49 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 3. Demand aggregation for RTPV deployment in the institutional
sectors (e.g. health, education and all government buildings)
integrated with storage
As per the Parliamentary Standing Committee’s latest assessment, only ► Dedicated capacity allocation for rooftop solar deployment in

Stimulus options
56.45% schools have adequate electricity access. Rural Health Statistics rural schools (2 GW) and health centers (500 MW) with
(2019) indicates that 26.3% of the rural sub–centers and 4.8% of rural Primary generation based incentives
Health Centers (PHCs) do not have access to electricity supply, which is not ► Extend low cost credit line for financing rooftop solar projects in
only imperative for the functioning of healthcare facilities but also a vital the institutional sectors
determinant of essential healthcare services delivery.
► Set up institutional mechanism at central and state levels for
Rural health centers and schools are largely vulnerable to irregular power demand aggregation and investment related actions under OPEX
supply and frequent interruptions adversely impacting the delivery of essential mode in both health and education sectors
healthcare and education in rural communities. Despite having diesel
generators for power backup, their operations are restricted due to
Recommendations

inadequacy of funds for diesel. Sometimes in remote locations, the supply of Stimulus benefits –
diesel is interrupted during monsoons or bad weather. As per the World Health (Cumulative over Solar PV system operating lifetime)
Organization (WHO), unreliable electricity access leads to vaccine spoilage,
interruptions in the use of essential medical and diagnostic devices, and lack
Direct savings in Direct savings in electricity
of even the most basic lighting and communications for maternal delivery and Fresh jobs
electricity costs of costs of rural government
emergency procedures. The quality of energy access in healthcare and created in rural
health centres elementary schools
education facilities may have crosscutting impacts, for example, retention of communities
health workers, improved enrolment / attendance of students and teachers in INR 5,875 INR 21,284 61,800
government schools who often live right alongside these facilities.
crores crores fresh jobs
Experience from Chhattisgarh, Odisha (Kalahandi) and Karnataka (Karuna (US$ ~0.8 billion) (US$ ~3 billion)
trust) have shown that health centers with rooftop solar systems provide 24–
hour healthcare services treating a greater number of patients. Regular access
to electricity has also enabled them to have reliable supply of water, safe Total capital investment
refrigeration for vaccines, and powered theatre equipment, fans, and baby Avoided CO2 emissions towards rooftop Solar PV systems in
warmers.
86 million health centres and rural
There are ~1.5 lakh health centers (viz. sub–centers, primary health centers government elementary schools
and community health centers) across the country with potential for ~564 MW tons of CO2e
of rooftop solar deployment. Similarly, there are approx. 6,82,000 rural
INR 11,200 crores
primary schools managed by government with potential for ~2 GW of rooftop
solar deployment. Source: EY analysis

50 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 4. Design and implement credit risk guarantee mechanisms to support RTPV financing for MSMEs
Many financial institutions lending for MSMEs perceive huge risks related to payment delays and defaults while evaluating RTPV loans and its benefits manifesting
largely as operational cost savings / energy cost savings. To help mitigate these risks, credit risk mitigation measures can be explored which will provide the
requisite cushion to financial institutions.
A credit guarantee (CG) mechanism provides guarantees on loans to borrowers by covering a share of the default risk of the loan. In case of default by the
borrower, the lender recovers the value of the guarantee from the guarantor.
A fixed CG cover to the participating financial institutions is envisaged. Under this, the evaluation of both the borrowers and final power off-takers will be the
responsibility of the financial institutions. The CG cover gets activated and disbursement takes place once the loan gets classified as loss asset by the lender. A fixed
cover of up to 50% of the loan amount under the CAPEX and RESCO mode can be considered depending on the risk profile of the borrower on a case to case basis.
Recommendations

Source: EY analysis

51 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Shovel-ready pipeline of decentralized grid connected
renewable energy systems under PM–KUSUM component – A
Introduction
Investment mobilisation for State wise pipeline
The simplified guidelines for implementation of PM–KUSUM (Pradhan sanctioned capacity (INR crores) capacity (MW)
Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan) Scheme, – Component A
notified in Dec’21, allows states 24 months for implementation of
sanctioned capacity. The Component–A supports setting up of 10 GW 18000 KERALA 40
of decentralized ground mounted grid connected renewable energy
power plants for providing additional source of income for land owning
16000 JHARKHAND 50
farmers. The grid connected renewable energy plant size is capped to
a capacity up to 2 MW. MNRE will provide procurement based
incentive (PBI) to the DISCOMs @ 40 paise/kWh or Rs.6.60 14000 UTTAR PRADESH 106
lakhs/MW/year for first five years, whichever is lower, for buying
renewable power under this scheme. The PBI will be given to the
12000 PUNJAB
DISCOMs for a period of five years from the commercial operation 220
date of the plant. 11733
10000
TAMIL NADU 500
Shovel-ready projects for implementation
~4.8 GW capacity of decentralized ground mounted grid connected 8000
ORISSA 500
renewable energy power projects are currently sanctioned by MNRE to
various state nodal agencies (mostly DISCOMs) for implementation 6000
under component A. A majority of these projects are still under MADHYA PRADESH 595
development with nodal agencies inviting landowners/farmers, Solar
EPC companies and developers to gauge their interest in project 4000
RAJASTHAN 725
financing and development. Both CAPEX and OPEX models are allowed
5028
for maximum participation from stakeholders. Landowners are allowed 2000
to develop ground mounted grid connected Solar PV power projects MAHARASHTRA 1931
on agriculture farmlands for dual use of power generation and
farming. DISCOMs will identify substations for grid interconnection, 0
allocate capacity from auctions, and enter into power purchase Equity Mobilisation Debt financing
agreements with qualified landowners for aggregated demand. Source: EY analysis based on JMK Research

52 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Investment mobilization Socio economic benefits
Currently, the state nodal agencies are testing and ~43,400 fresh jobs will be created in building 4.8
streamlining the process for solicitation of market GW capacity of decentralized ground mounted grid
participants, capacity allocation, PPA execution, connected renewable power projects announced
construction and commissioning, monitoring and under KUSUM component A. These jobs will emerge
evaluation before rapidly scaling up capacity in rural areas with private sector investments along
addition. For the sanctioned capacity already under the value chain of project development,

PM–KUSUM component – A
development, a total of INR 16,762 crores (US$ construction and commissioning, operations and

grid connected renewable

~2.25 billion) of capital investment will be mobilised maintenance of solar PV systems all across the

pipeline of decentralized
from the landowners and other project developers. country.
Private sector funds will be largely utilised to meet

energy systems under

this massive capital expenditure.
Fresh jobs created

Capital Investment – Equity

~43,400 jobs
For 4.8 GW of ground mounted solar PV
~INR 5,028 crores projects announced under KUSUM–A
For 4.8 GW of ground mounted solar PV
projects announced under KUSUM–A

Shovel-ready
Environmental benefits
Over ~190 million tonnes of CO2e emissions are
Capital Investment – Debt expected to be avoided over the operating
~INR 11,733 crores lifetime of 4.8 GW capacity of grid connected
ground mounted solar PV projects commissioned
For 4.8 GW of ground mounted solar PV under the program.
projects announced under KUSUM–A
Avoided emissions
(cumulative over project lifetime)

~190 million tonnes CO2e

For 4.8 GW of ground mounted solar PV
projects announced under KUSUM–A

53 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Shovel-ready pipeline of standalone solar powered
agriculture pumps under PM–KUSUM component – B
Introduction
Investment mobilization for Number of pumps
The simplified guidelines for implementation of PM–KUSUM (Pradhan sanctioned capacity (INR crores) sanctioned State wise
Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan) Scheme, – Component B
notified in December 2021, allows states conduct competitive price Kerela 0
discovery of standalone Solar Powered Agriculture Pumps on their 8000
Delhi 0
own. Under Component B, 17.5 lakhs standalone solar irrigation
Manipur 20
pumps are targeted for installation with CFA of 30% of the benchmark
7000 Mizoram 200
cost or the tender cost, whichever is lower. The State Government will
give additional subsidy of min. 30% and the remaining will be financed Himachal Pradesh 550
by participating farmers / beneficiaries. Tripura 1300
6000
Meghalaya 1700
Shovel-ready projects for implementation
3529 Odisha 2500
~2.0 GW capacity from 3,56,453 stand alone solar pumps are 5000
Gujarat 4000
currently sanctioned by MNRE for implementation under component
Punjab 4500
B. Maharashtra, Madhya Pradesh, Rajasthan and Chhattisgarh are the
4000 Karnataka 6000
leading states with sanctioned pumps more than 20,000 and above.
Uttar Pradesh 8000
3000 Jharkhand 10000
Haryana 15000
2416 Tamil Nadu 17500
2000
Chhattisgarh 20000
Rajasthan 25000
1000
Madhya Pradesh 25000
1035 Maharashtra 30000
0

Equity Debt Subsidy

Source: EY analysis Source: MNRE

54 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Investment mobilization Socio economic benefits
For the sanctioned capacity already under ~18,000 fresh jobs will be created for deployment
development, a total of INR 3,451 crores (US$ of ~3.5 Lakh stand alone pumps under KUSUM
~0.47 billion) of capital investment will be mobilised component B. These jobs will largely emerge in the
in 2021–22 from the participating farmers. rural areas along the value chain of construction
and commissioning, operations and maintenance of
solar pump systems.

PM–KUSUM component – B
standalone solar powered
agriculture pumps under
Capital Investment – Equity Fresh jobs created

Shovel-ready pipeline of
~INR 1,035 crores ~18,000 jobs
For 3.5 Lakhs standalone solar pumps projects For 3.5 Lakhs standalone solar pumps projects
announced under KUSUM–B announced under KUSUM–B

Capital Investment – Debt Environmental benefits

~INR 2,416 crores Over ~16 million tonnes of CO2e emissions are
expected to be avoided over the operating
For 3.5 Lakhs standalone solar pumps projects lifetime of 3.5 Lakh stand alone solar PV projects
announced under KUSUM–B commissioned under the program.

Avoided emissions
(cumulative over project lifetime)

~16 million tonnes CO2e

For 3.5 Lakhs standalone solar pumps projects
announced under KUSUM–B

55 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Shovel-ready pipeline of decentralized grid connected
solar PV systems under PM–KUSUM Component – C
Introduction
Investment mobilization for Number of pumps
The Component C targets solarization of 10 lakh grid connected sanctioned capacity (INR crores) sanctioned State wise
pumps. Up to 50% can be solarized at feeder level under this – Component C
component. MNRE will provide CFA of 30% of the benchmark cost for Odisha 0
solarization of grid connected pump sets. The State Government will 7000
Mizoram 0
give additional subsidy of min. 30% and the remaining will be financed
by beneficiaries. The feeder solarization capacity can be twice as much Kerela 0
as the connected load on dedicated agricultural feeders. 6000 Karnataka 0
Himachal Pradesh 0
Shovel-ready projects for implementation
Delhi 0
~1.9 GW capacity is currently sanctioned by MNRE to various state 5000
Chhattisgarh 0
nodal agencies (mostly DISCOMs) for implementation under 3961
component C. A majority of these projects are still under development Meghalaya 60
with nodal agencies aggerating land, inviting developers / Solar EPC 4000 Manipur 80
companies to gauge their interest in project financing and Haryana 468
development. Both CAPEX and OPEX models are allowed for maximum
Jharkhand 500
participation from stakeholders. Under CAPEX mode, DISCOM will 3000
make its own investment towards solar PV power plants by arranging Uttar Pradesh 1000
own funds, collaborate with empaneled EPC contractors / System Tripura 1300
Integrators for setting up grid connected ground mounted solar PV
2000 Punjab 3900
power plant on turnkey basis, operate and maintain the plant during 1849
the PPA tenure. Under RESCO mode, DISCOM will purchase power Maharashtra 9000
from a third–party developer selected after competitive tariff Rajasthan 12500
discovery through reverse bidding/auctions. 1000
Madhya Pradesh 15000
792 Gujarat 18500
0 Tamil Nadu 20000
Equity Moblisation Debt Financing Capital Subsidy 0 5000 10000150002000025000
Source: EY analysis based on JMK Research Source: MNRE

56 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Investment mobilization Socio economic benefits
For the sanctioned capacity under development, a ~17,100 fresh jobs will be created in building 1.9
total of INR 2,641 crores (US$ ~ 0.35 billion) of GW capacity of decentralized grid connected solar
capital investment will be mobilized. powered feeders under KUSUM component C. These
jobs will emerge in rural areas with private sector

decentralized grid connected

investments along the value chain of project
Capital Investment – Equity development, construction and commissioning,

PM–KUSUM Component – C
operations and maintenance of solar PV systems.
~INR 792 crores

Shovel-ready pipeline of
For 1.9 GW of ground mounted solar PV

solar PV systems under

projects announced under KUSUM–C Fresh jobs created

~17,100 jobs
For 1.9 GW of ground mounted solar PV
Capital Investment – Debt
projects announced under KUSUM–C
~INR 1,849 crores
For 1.9 GW of ground mounted solar PV
projects announced under KUSUM–C Environmental benefits
Over ~75 million tonnes of CO2e emissions are
Source: EY analysis
expected to be avoided over the operating lifetime
of 1.9 GW capacity of grid connected solar PV
projects commissioned under the program.

Avoided emissions
(cumulative over project lifetime)

~75 million tonnes CO2e

For 1.9 GW of ground mounted solar PV
projects announced under KUSUM–C

57 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 1. Generation-based incentives for decentralized grid connected ground mounted solar PV systems co–located with crops on agriculturally
productive land parcels (hereinafter referred as agro–PV projects)

PM–KUSUM component A is designed to provide alternate / The land use impact from solar Separate Land Use on 1 Hectare land:
additional source of income and livelihood from decentralized energy expansion is likely to have 100% Farmland or 100% Solar Electricity
renewable power generation for: cross cutting implications on the
i. Farmers of cultivable land food security and land productivity
ii. Farmers or landowners of wasteland / barren / uncultivable land of the country. In this regard, it is
worthwhile to examine the 100% farmland
The first category of farmers would have to design and develop solar
alternative use cases of land
PV systems for co–location with crops on agriculturally productive
acquired for solar energy
land parcels. This will require elevated structures and a more
generation and device policy
dispersed solar PV array arrangement to permit sufficient sunlight
for crop cultivation, thereby increasing the capital cost. A variety of
pathways to reduce the land use
OR
accelerated economic recovery

impact. KUSUM scheme Component

innovative agro–PV solutions are emerging from successful
A can be a perfect test bed to scale
demonstrations in Germany, Japan, South Korea, China, France, the
up adoption of agro–PV solutions.
United States and India. The Indian Council of Agricultural Research
– Central Arid Zone Research Institute (ICAR–CAZRI) has successfully Ideally, DISCOMs have to conduct
commissioned Solar PV systems co–located with a variety of crops in the competitive auction process in 100% solar
Jodhpur. two separate tranches of capacity electricity
Stimulus measures for

allocation for projects proposed on

As per a recent IRENA report (2019), agro–PV systems combine
barren and agriculturally productive
solar PV and agriculture on the same land and consists of growing
land parcels. This will ensure level
crops beneath ground mounted solar panels. Although the concept
playing field for all the participants.
was in existence for long, it has received little attention until
DISCOMs may also shy away from Combined Land Use on 1 Hectare land:
recently, when several researchers have confirmed the benefits of
higher cost of power procurement
growing crops beneath the shade provided by the solar panels. These
from co–located agro–PV systems
186% land use efficiency
include higher electricity production, higher crop yields and less
developed on agriculturally
water used. Many types of food crops, such as tomatoes, grow better
productive land. In this scenario,
in the shade of solar panels, as they are spared from the direct sun
generation based incentives for
and experience less water loss via transpiration, which also reduces
promoting co–located agro–PV
water use while maintaining the same level of food production. A key
systems will reduce the burden on
advantage for solar panels is that their efficiency is increased.
DISCOMs and at the same time
Cultivating crops underneath reduces the temperature of the panels,
make these investments
as they are cooled down by the fact that the crops below are
economically attractive. Source: Fraunhofer Institute
emitting water through their natural process of transpiration. for Solar Energy Systems ISE

58 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 2. Dedicated financing facility for improving farmer access to low-cost debt funds and boosting commercial viability of 1—2 MW scale
ground mounted Solar PV projects on CAPEX mode (own investment from farmers)
A major impediment reported by the states for implementing PM–KUSUM Establish a dedicated financing facility of ~INR 25,000 crore on the lines of
component is the inability of individual farmers/ group of farmers/ cooperative Agri Infrastructure Fund to enable farmers access low cost debt financing for
societies/ panchayats/ FPO/ WUA to raise funds (approx. 2.45 crores per MW setting up 5 GW of decentralized renewable energy projects on CAPEX mode
in case of component A, 40% of project cost in case of components B and C) under PM–KUSUM component A.
for implementing the projects on their own. MNRE should conduct a detailed
review of currently available schemes of NABARD and commercial banks,
analyze adequacy of these schemes, and suggest any modifications necessary
to improve effectiveness of these financial products for financing KUSUM
scheme. Public sector banks such as ‘Bank of Baroda’, ‘Central Bank of India’, Direct annual savings Fresh jobs created
‘Union Bank of India’ have notified lending terms and conditions for financing in access to electricity in rural communities
accelerated economic recovery

projects under KUSUM scheme. These banking products require 150% of INR235 crores 61,800 jobs
project value as collateral for loan security apart from primary security
obligations such as hypothecation of plant and machineries, mortgage of land,
third party guarantee, exclusive charge over PPA and escrow account through
tripartite agreement between DISCOM, Bank and farmer enterprise etc.
Farmers can also avail benefits of credit guarantee coverage under CGTMSE if
Stimulus measures for

registered as MSME and having obtained Udyam Registration certificate. Investment to boost
These loans (for components B&C) can also be converged under Agriculture Avoided CO2 emissions
rural economic activity
Infrastructure Fund scheme for interest subvention as the projects are
considered as community farming assets. Payment risk of DISCOMs may affect
86 million tons INR9,000 crores
the volume of commercial financing that can be raised for this scheme.
Therefore MNRE in consultation with states can explore alternatives like sale
of power to intermediary CPSUs (e.g., SECI, EESL) who can use open access to
contract with Farmer Enterprises for back to back sale with large public sector Source: EY analysis
energy intensive consumers at–least for the duration of loan. More
importantly, MNRE could also explore policy amendments to make component
A as attractive as component C for DISCOMs and farmers after considering
subsidies.

59 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Advancing self–reliant
supply chains for sustainable
energy transition

6
60 Accelerating India’s clean energy transition
 High efficiency solar PV cell and module manufacturing
Enlisting manufacturers and models of solar PV modules
As per the latest (April 2022) approved list of manufacturers and models of Solar PV Modules (ALMM), the current
enlisted capacity for manufacturing solar PV modules in India is ~13.2 GW. The installed capacity for manufacturing solar
PV cells is ~3 GW as per MNRE.
In order to boost demand for locally manufactured solar PV modules, the government schemes including central public
sector undertaking (CPSU) scheme, phase 2 of grid connected rooftop solar program and PM–KUSUM scheme mandate
domestic content requirement for sourcing solar PV modules. The government has also issued amendments to ALMM
order, 2019 clarifying that only the models and manufacturers enlisted under ALMM will be eligible for use in Government
Projects / Government assisted Projects / Projects under Government Schemes & Programmes / Open Access I Net
Metering Projects, installed in the country, including projects set up for sale of electricity to Government under the
Guidelines issued by Central Government under section 63 of Electricity Act, 2003 and amendment thereof.

Production linked incentives for domestic manufacturing

To enhance India’s solar PV manufacturing capabilities and exports, MNRE issued the Scheme Guidelines for ‘National
Programme on High Efficiency Solar PV Modules’ with an initial outlay of INR 4500 crores in April 2021. The scheme has
provisions for supporting integrated manufacturing units of high efficiency solar PV modules by providing Production
Linked Incentive (PLI) on sales of such solar PV modules. Budgetary outlay for the scheme was increased from INR 4500
crores to INR 24000 crores to accommodate more players and ramp up domestic manufacturing capacity. On average 4–
6% of the production value is provided as incentive to promote competitiveness among global markets. In Feb’22, IREDA
announced the updated list of successful bidders to set up 10 GW of vertically-integrated manufacturing capacities of
high-efficiency solar modules under the PLI program.
As per media reports, the draft guidelines for Tranche II envisages INR 12000 crores reserved for bidders setting up
vertically-integrated capacities of polysilicon, wafers, cells, and modules; INR 4500 crores for those setting up wafers,
cells, and modules capacity, and INR 3000 crores for cells and modules capacity. The implementation of the PLI program
(Tranche-II) is now handed over to SECI. The applicant manufacturer will have to commit to a minimum level of integration
across solar cells and modules to qualify for the bid. Based upon the extent of integration proposed, the bidder can opt for
bidding for any of the three baskets. The applicant will have to set up a minimum 1 GW manufacturing unit to qualify for
the bid. The maximum capacity to bid is 10 GW for polysilicon, wafer, cell, and module; 6 GW for wafer plus cell and
module; and 6 GW for cell and module categories. However, the maximum capacity awarded to one bidder under the PLI
program would be 50% of the bid capacity.

61 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Shovel-ready projects for implementation Investment mobilization
Approximately 112.5 GW/year capacity for manufacturing solar PV cells and modules A total of INR 3.55 lakh crores (US$ ~ 45.8 billion) of capital investment will be
are in the pipeline at various stages of development. These projects are spread across 8 mobilized to operationalize these projects in the pipeline.
states with Gujarat leading 14.7 GW/year capacity. However, location for ~78.1
GW/Year capacity under pipeline is not available. About 48.6 GW/Year capacity under
pipeline is committed for PLI scheme. This indicates that there is substantial Capital Investment – Equity Capital Investment – Debt
manufacturing capacity under pipeline not expecting incentives under the PLI scheme.
As the global supply chain pivots away from China these projects would likely cater to ~INR 1.06 lakh crores ~INR 2.49 lakh crores
the export markets, thereby positioning India as a key exporter of solar PV cells and For 112.5 GW/year capacity of solar For 112.5 GW/year capacity of solar
modules. cell/module manufacturing cell/module manufacturing
Approximately 30.2% of total pipeline capacity is expected to have integrated cell and
module facilities, 44.7% with only module manufacturing and 37.6% with only cell
manufacturing.
Social benefits
Location of PV Manufacturing Value chain of pipeline capacity
The total pipeline of solar PV cell and module manufacturing facilities will create direct
cell and module capacity under (GW/year) employment for ~5 lakh professionals.
manufacturing pipeline
facilities (GW/year)
Gujarat 14.7
Fresh jobs created
Tamil Nadu 7.0
Karnataka 3.1
30.2, 27%
~5 lakhs
44.7, 40%
For 112.5 GW/year of capacity of solar cell/module manufacturing
Maharashtra 2.5
Rajasthan 2.5
Uttar Pradesh 1.8
Telangana 1.7
Andhra Pradesh 1.2
NA* 78.1 37.6, 33%

Grand Total 112.5

Module Cell Integrated (cell & module)
Source: EY analysis based on JMK Research Source: EY analysis based on JMK Research
* Information not available

62 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Advanced chemistry battery cell manufacturing
350 40% EV 18
Short and long term demand outlook
share
The demand for advanced chemistry battery cells in India will be driven
15 16
largely by electric mobility transition in the short-medium term and 300
stationary grid storage applications in the long term. As per NITI
Aayog, the annual market for stationary and mobile batteries in India 14
could surpass US$15 billion by 2030, with almost US$12 billion from 250
cells and US$3 billion from pack assembly and integration.

Annual Demand (GWh/Year)

12

Market Size ($ Billion)

In the transport sector, India is among a handful of countries that
support the global EV30@30 campaign, which targets to have at least 200 10
30% new vehicle sales electric by 2030. This presents India with a 48% EV
powerful opportunity to emerge as a global leader in new mobility share
150 8
solutions and battery manufacturing, positioning for sustainable
economic growth and global competitiveness. India is uniquely 6
positioned to deploy EVs at scale, leapfrogging traditional mobility 6
models that perpetuate air pollution and oil import dependence while 100 21% EV
driving down the costs of batteries through economies of scale. share 4
In the energy sector, India announced a target of 500 GW of non–fossil 50 2
fuel energy deployment by 2030 as commitment to tackle climate 2
change at COP 26. Achieving high levels of intermittent renewable
energy penetration in the grid will naturally create a large market
0 0
opportunity for stationary storage. The CEA in its optimal generation 2022 2026 2030
mix report for FY 2029–30 estimates ~136 GWh of energy storage
capacity in the grid to integrate high share of intermittent renewable
energy sources. Stationary energy storage systems (ESS) can provide
a variety of services to stakeholders at all levels of the electricity
Passenger Evs Commercial Evs E 2-wheeler/3-wheeler
system, including GT&D utilities and end–use customers. With the
E-buses Freight Stationary Storage (Grid-scale)
historical rate of cost decline in the lithium–ion battery industry, the Behind-the meter (Res + Comm) Consumer Electronics Rail + Defense
government and industry together is currently betting on this Market Size
advanced chemistry battery technology for stationary energy storage
Source: NITI Aayog, 2022
applications.

63 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Understanding energy storage systems (ESS) in the context of Shovel-ready projects for implementation
India’s energy transition Several projects targeting different segments of lithium-ion battery manufacturing value
The Ministry of Power, Govt. of India recently issued a detailed clarification regarding chain are currently in the pipeline. All of these projects are led by private sector and
the usage of ESS in the power sector. The Ministry clarified that ESS can be advanced located in Karnataka, Tamil Nadu, Telangana, Haryana, Gujarat and Himachal Pradesh.
chemistry battery systems, pumped hydro systems, thermal phase change systems, The total manufacturing capacity of battery cells and components in the pipeline is
green hydrogen and green ammonia-based storage systems. The Ministry also clarified ~105 GWh/year, along with 2 GWh/year battery recycling and ~7 GWh battery pack
that ESS can be used for grid balancing services providing fast response ramp up and assembly.
down, peaking power support, enhancing flexibility in the power system operations,
firming up of RE power generation at the source, energy shifting, enabling optimum Project Category Project Capacity (GWh/year)
capacity utilization of T&D network and CAPEX deferral, arbitrage, peak shifting etc. Battery Pack Assembly 7
The government also clarified that standalone ESS as a service does not need any
license for operations. Battery Pack Recycling 2
Battery cell / cell component Manufacturing 105
ACC PLI scheme
Source: EY research
The department of heavy industries notified the Production Linked Incentive (PLI)
scheme, ‘National Programme on Advanced Chemistry Cell (ACC) Battery Storage’ in Investment mobilization
2021 for implementation of giga–watthour scale ACC manufacturing facilities in India
with a budgetary outlay of INR 18100 crore. The scheme envisaged setting up of a ~INR 1.41 Lakh crores of investment is expected for operationalizing 114 GWh/year
cumulative ACC manufacturing capacity of 50 GWh and an additional cumulative capacity of the advanced chemistry battery manufacturing project pipeline till 2025.
capacity of 5 GWh for Niche ACC Technologies.
The beneficiary must ensure achieving a domestic value addition of min. 25% and incur Capital Investment – Equity Capital Investment – Debt
the mandatory investment (₹ 225 crore /GWh) within 2 Years (at the Mother Unit Level)
and raise it to 60% domestic value addition within 5 Years, either at Mother Unit, in–case ~INR 42,418 crores ~INR 98,975 crores
of an Integrated Unit, or at the Project Level, in–case of “Hub & Spoke” structure (the For 114 GWh/year of capacity of For 114 GWh/year of capacity of
“Project”). To ensure a single–window mechanism for the potential investors, a state– battery cell/pack manufacturing battery cell/pack manufacturing
level grand– challenge is being planned, including provision for encumbrance–free land,
trunk infrastructure facilities, power at rationale rate to the potential investors for
attracting the Projects.
Social benefits Fresh jobs created
A total of 10 bids with capacity ~130 GWh was received under the ACC PLI scheme. The
incentive structure is designed to encourage industry to promote fresh investments in The total pipeline of battery cell and ~4.33 lakhs
indigenous supply chain and deep localization for ACC battery manufacturing in the battery pack manufacturing facilities
is estimated to generate ~4.33 lakh
For 114 GWh/year of capacity of
country. Finally, 4 bidders got selected for incentives under the scheme for a
cumulative capacity of 50 GWh per year. direct–indirect employment. battery cell/pack manufacturing

64 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 1. Reimagine the ACC PLI scheme to promote local value 2. Implement grand innovation challenges for solar PV and
addition via battery materials recycling industry energy storage industry to pilot and demonstrate cost
India being a resource constrained region for critical ACC battery materials effective, durable technologies made from earth abundant
(a.k.a cathode active materials) such as lithium, recycling should naturally gain materials
prominence in shaping policy. The ACC PLI scheme currently mandates up to The stationary storage industry can compromise on energy density and round
60% local value addition within five years. Upstream requirements for ACC trip efficiency of advanced chemistry battery cells if other performance
battery cell production include sourcing raw materials and chemical refining parameters such as long duration storage, levelized cost / kWh and life (no. of
for production of cathode active materials, a critical step in the production of charge – discharge cycles) are superior to existing technologies. Levelized cost
cathode, which is the largest cost centre (~54%) in the Li-ion battery bill of of energy storage is a key performance parameter for stationary ESS solutions
materials. and has to compete with levelized cost of energy from fossil fuels for scaling
Moreover, the explosion in number and capacity of battery giga-factories up adoption in India.
globally has not been met with comparable growth in supply chain of active The Government through CSIR (Council of Scientific and Industrial Research)
materials. Therefore, a competitive recycling industry is a crucial component could invite applications from both domestic and international players to
Recommendations

for achieving India’s objectives of self reliance in ACC batteries. Recycling conduct joint R&D initiatives with premier academic institutions for building
used batteries, especially without domestic natural reserves, is India's best advanced chemistry battery cell prototypes made from earth abundant
alternative to boost domestic battery materials production and further elements that enables long duration storage (>20 hours per cycle) and lasts
enhance opportunities in other sectors of the supply chain. Indian companies much longer that existing ACC batteries. The grand challenge should aim to
can develop a competitive edge in sourcing critical battery materials through launch commercially viable products that cost < 50 USD / kWh when produced
recycling and establish an important foothold in the rapidly expanding EV at scale.
ecosystem. It is critical that battery raw material production is achieved
through setting up sizeable recycling capacity, but also that it is done in the Likewise, due focus is necessary to prepare technology blueprints and invest
most eco-friendly and sustainable ways. in emerging as well next generation technologies governing solar cells,
examples being:
In fact, setting up large-scale capacity to recover valuable metals from used
batteries has become a key milestone for all major governments throughout ➢ Monocrystalline Interdigitated Back Contact (IBC) Cells
the globe. India should also embrace this view and seize the recycling ➢ Monocrystalline Hetero-Junction (HJT) Cells
opportunity to mitigate key supply chain risks.
➢ Monolithic Solar Cells
➢ Perovskite PV Cells
To provide boost to domestic manufacturing, setting aside dedicated funds for
investing in R&D and providing incentives for indigenous production is
recommended.

65 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Pipeline of EV charging
infrastructure projects

7
66 Accelerating India’s clean energy transition
 Pipeline of electric vehicle (EV) charging infrastructure
Introduction Revised consolidated guidelines and Standards for charging
India is among a handful of countries that support the global EV30@30 campaign, which infrastructure for Electric Vehicles (EV)
targets to have at least 30% new vehicle sales electric by 2030. As per ACMA, India’s EV In January 2022, the Ministry of Power promulgated the ‘revised consolidated
market in FY21 comprises 61% electric two–wheelers, 37% electric three–wheelers and guidelines and standards for charging infrastructure for Electric Vehicles (EV)’. Among
light commercial vehicles, 2% electric four–wheelers, and 0.2% e–buses. To support many issues, these guidelines have fixed the timelines for providing grid connectivity for
mass adoption of EVs, India will need to deploy a robust electric vehicle public charging installation of public charging stations, which is a right step for ease of setting up this
infrastructure. Currently, 19 states have dedicated EV policies for encouraging mass critical infrastructure. The state electricity regulatory commissions will have to enforce
adoption and investments. these guidelines in letter and spirit. The guidelines lay down the following locational
density targets for deploying public EV charging stations:
EV charging infrastructure rollout under national programs ► At least one charging station in every 3x3 km grid
► One charging station every 25 km on both sides of highways and roads
Phase–II of FAME scheme was launched in 2019 with an outlay of Rs. 10,000 Crore for
► One fast charging station every 100 km on highways / roads for long range
a period of three years initially and the same is now extended until 31 March 2024. Out
/ heavy duty EVs
of total budgetary support, about 86 percent of fund has been allocated for demand
incentives to create demand for EVs in the country. There are currently 164 EV models Many factors including EV penetration in the 2W/3W/4W markets, optimal capacity
registered for FAME II purchase incentives, 2.5 lakh EVs sold with incentives to the tune utilization of charge points, ease of setting up charging stations, economics of operating
of ~INR 935 crores. The Department of Heavy Industries (DHI), Government of India, EV charging stations etc., determine the speed and scale of achieving the EV charging
which is the nodal agency for administering incentives under FAME II, invited proposals infrastructure density targets with industry support. The need for EV charging
for deployment of 174 EV charging stations on 1,775 kms stretch of expressways and investment and deployment is irrefutable. But the demand and other uncertainties
1,370 stations on 13,370 kms stretch of highways in October 2020. The Ministry of combine to make public charging infrastructure risky and an unattractive investment.
Power has sanctioned 2,877 charging stations in 68 cities across 25 states and UTs and To achieve scale, debt financing is critical and the industry must gradually reduce
1576 charging stations across 9 expressway and 16 highways as of December 2021. dependence on policy driven subsidies. Simply put, the business case needs to improve
Currently, the project pipeline for EV charging stations under Fame II scheme substantially. It is critical to understand the levers that can increase revenues and
accumulates to a total of 5131 stations. reduce costs to make the business case more appealing to mainstream debt investors.
There are significant commercial, structural and operational levers to reduce latency,
No. of EV charging CAPEX outlay Sum of number of job
Scheme enhance revenues and cut costs. Smart charging services, advertisement, retail
stations under pipeline (INR crores) years created
colocation and network interoperability are levers for revenue enhancement.
FAME–II 5,131 1,462 15,393
In this context, the guidelines promote revenue sharing model for setting up public
Private Contracts 3,41,098 97,213 10,23,295 charging stations. Land available with the Government/Public entities can be monetized
State Tenders 1,55,140 44,215 4,65,421 for installation of Public Charging Stations on a revenue sharing basis at a fixed rate of
₹ 1 / kWh (used for charging). This is a step in the right direction if adopted widely with
Grand Total 5,01,370 1,42,890 15,04,109
transparent and competitive bidding mechanisms.

67 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 State level initiatives for EV charging infra roll out Project Pipeline (sanctioned) for setting up EV charging stations
Some states like Andhra Pradesh, Assam, Delhi, Telangana, and Uttar Pradesh have set No. of EV Total CAPEX Number of
Project Equity Debt
concrete targets for EV charging infrastructure rollout. The Andhra Pradesh and Uttar charging Outlay Jobs
location (INR crores) (INR crores)
Pradesh EV policies have targets of 0.1 and 0.2 million charging stations, respectively, stations (INR crores) created*
to be built by 2024. Delhi and Kerala aims to have chargers located every 3 km in urban Andaman &
areas and every 25km on highways, whereas Bihar, Haryana, Karnataka, Madhya 20 6 2 4 60
Nicobar Islands
Pradesh and Telangana aims to have chargers located at every 50 km on all highways.
State EV policies primarily rely on capital subsidies to realize these targets. Tamil Nadu Andhra 1,00,610 28,674 8,602 20,072 3,01,830
aims for installing at every 25 km on highways along with 10% public parking in Pradesh
commercial areas. Whereas Punjab specifies to setup 1 of 5 parking in residential/non Assam 20 6 1 3 60
residential buildings. Reimbursement of the net state’s goods and services tax (SGST) 25 7 2 5 75
Chhattisgarh
and exemption on electricity duty & stamp duty are provided in states like Andhra
Pradesh, Haryana, Tamil Nadu, Telangana, Uttar Pradesh, and Karnataka. Interest free Delhi 30,277 8,629 2,589 6,040 90,831
loans are also provided by the Karnataka state government to those setting up charging Gujarat 195 56 11 25 585
stations. Eleven Indian states provide special EV tariffs for public charging stations 1 0 0 0 3
Haryana
whereas twelve states are providing capital subsidy to charging manufacturing
industries of various scale. State governments in 15 states are providing subsidies for Karnataka 1,350 385 103 240 4,050
initial build out of public charging stations @25% of capital cost or INR 10 lakhs/station Kerala 442 126 27 63 1,326
whichever is lower. The Delhi government provides a grant of up to 100% on charging
equipment set up by building owners, whereas Uttar Pradesh provides 25% rebate on Madhya 200 57 7 15 600
the market rate for land procured for setting up charging points. Pradesh
Maharashtra 414 118 23 53 1,242
Socio economic benefits Meghalaya 11 3 0 1 33
The EV charging infrastructure under pipeline would require a capital outlay of INR1.4 Odisha 25 7 1 2 75
Lakh Crores, and is expected to generate approximately 15 lakh skilled/unskilled jobs. 162 46 14 32 486
Tamil Nadu
Telangana 800 228 68 160 2,400

Capital Investment Fresh jobs created Uttar Pradesh 100 29 3 6 300

Uttarakhand 10 3 1 2 30
~INR 1.4 Lakh crores ~15 Lakh jobs Pan–India 3,66,708 1,04,512 28,158 65,703 11,00,123
For 5 Lakhs electric vehicle For 5 Lakhs electric vehicle Grand Total 5,01,370 1,42,890 39,611 92,426 15,04,109
charging stations charging stations
* Supply chain and operation related jobs are considered
Source: EY research, Department of Heavy Industry

68 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 1. Promote coupling of EV charging with 3. Promote electric utility-driven business models for setting up EV charging Infra
low–cost renewable energy systems There are ample opportunities for Indian DISCOMs to gradually diversify services towards EV charge point
There is need to reimagine ways for promoting operations, leverage synergies with renewable energy integration and generate sustainable alternate
ease of charging EVs with low–cost renewable revenue streams. DISCOMs should plan and initiate asset monetization drives by simply leasing the real
energy (RE) systems. Coupling EV charging with estate located in prime locations identified by private players. DISCOMs can also opt for revenue sharing
low–cost renewable energy systems can go a models wherein utility investment can be targeted towards setting up electrical infrastructure components
long way in improving the economics of both EV such as transformers, transformer pads, service meters, service panels, cables, conductors, smart grid
and RE adoption. The guidelines notified by devices etc. Strategic public private partnerships with OEMs of automotive components and EV chargers /
Ministry of Power has taken its first step in this EV supply equipment can be explored for leveraging the benefits from higher economies of scale.
direction for public charging stations by allowing Investment / cost items Revenue items
open access, stipulating the timelines for open
access applications and applicable open access Type of Other add
Revenue Revenue Revenue
Business on services Revenue
charges. Land/ EVSE Electrical
(e.g.
from rent /
from sale of
from EV from other
Models location equipment infrastructure lease of charging add on
Recommendations

advertising, electricity
location stations services
2. Rationalize GST on Lithium Ion parking)
batteries to support battery Utility fully-
swapping facilities owned (end-
to-end)
There is immense potential for battery swapping
facilities to reduce upfront cost of EVs (decouple Utility
batteries from vehicles) and at the same time providing
access to
allow for seamless battery powered operation of location only
EVs through swapping facilities. The
Government of India recently announced its Utility
intentions to formulate battery swapping policy providing
access to
to enable this transition. location and
The policy should aim to resolve following major investing in
concerns for EV suppliers and battery swapping electrical
infrastructure
investors :
► Lack of uniform specs / standardization of Utility
battery form factors for seamless investing in
interoperability / fitting of batteries at land and NA
electrical
service centres infrastructure
► 18% GST on lithium ion batteries can make
the entire business model unattractive Utilities Charging operators

69 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 4. Promote smart charging and other Revenue enhancement and cost–reduction levers
alternate revenue levers for EV charge point
Revenue levers
operators and investors Smart charging
services
The principal challenge for setting up EV charging infra is that Cost levers
Setting up EV charging
the business case for investment may not stack up in the
stations alongside pre-
traditional sense. Understanding how to position the business
existing retail stores
case, and which levers to pull, can unlock investment
channels to accelerate infrastructure rollout. And that is a Advertisement
accelerated economic recovery

trigger in the national journey toward decarbonization. Auxiliary revenue

Smart charging
stream from
On an average, the payback period for an investment in public services
advertisements at the
EV charging infrastructure is 10+ years. The business case Revenues from grid
charging locations
needs rethinking to support predicted EV growth. There are flexibility services,
significant commercial, structural and operational levers to such as demand
reduce latency, enhance revenues and cut costs. response through
Re–modelling the business case can boost the investment risk coordinated charging
Stimulus measures for

profile, give greater appeal to mainstream debt financiers and and discharging of EVs
enable infrastructure to scale.
The conventional business case struggles to justify EV
charging infrastructure investment. Poor cashflow and
returns are jeopardizing the case for investment in public EV Network
charging infrastructure. EY research finds that a typical interoperability
charging station, with two slow (6.6kW) and two fast (50 kW) Opening up
chargers, will take five years to yield positive cashflow. Our propriety-
analysis shows that the payback periods for charging registered
infrastructure investments are longer than 10 years. charging stations
The need for EV charging investment and deployment is to all drivers,
Neutral hosts irrespective of
irrefutable. But the uncertainties combine to make public
Capex reduction by their subscription
charging infrastructure risky and an unattractive investment.
Vertical co-investment finding partners that contract with
In fact, more than three–quarters (76%) of total capital inflows
Getting players from provide real estate other networks
into EV charging companies in 2019 is equity,
dependent industries in the and fund charger
grants/subsidies or venture capital. To achieve scale, debt
product(s) vertical value chain costs in lieu of fixed
financing is critical. Simply put, the business case needs to
to coinvest in the asset revenue share
improve.

70 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 It is critical to understand the levers that can increase revenues and reduce costs to make the business case more appealing to mainstream debt investors.

Impact of Levers

Levers Revenue enhancement Cost reduction IRR Improvement

accelerated economic recovery

Smart charging services 32% 8%

Advertisement 6% 7%
Stimulus measures for

Retail colocation 12% 6%

Network Interoperability 20% 4%

Vertical co-investment 35% 5%

Neutral hosts 47% 12%

* In the figure above, revenue enhancement accounts for the incremental revenue each lever adds in the 10th year. Cost reduction takes into account the
capex reduction achieved under these levers. Smart charging services considers Internal Rate of return (IRR) improvement when compared with the base case.

71 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Enabling Green Hydrogen
policies to decarbonize
manufacturing sector

8
72 Accelerating India’s clean energy transition
 Reduce 45%
Panchamrit of India’s climate 500 GW of 50% of electrical energy Reduce total projected Achieve net–
carbon intensity
actions announced during non–fossil energy capacity from renewable carbon emission by one zero emissions
of economy by
COP26 Glasgow capacity by 2030 energy sources by 2030 billion tonnes by 2030 by 2070
2030

Definition of ‘Green hydrogen /

Produced by way of electrolysis of water using renewable energy including production from biomass
ammonia’
Green hydrogen policy enablers:

Waiver of inter-state
Granted for a period of twenty five years for projects commissioned before 30 th June 2025
transmission (ISTS) charges

Open access for sourcing renewable energy will be granted within

Grant of Open Access Open access charges as per existing rules
fifteen days of receipt of application complete in all respects

Banking permitted for a period of 30 days for Banking charges fixed by state commissions not more than cost
Banking of surplus renewable
renewable energy used in the production of differential between average tariff of procurement and market
energy
green hydrogen/ammonia clearing price in DAM

Connectivity granted on priority under the Electricity (Transmission System Planning, Development and Recovery of
Grant of ISTS connectivity
Inter State Transmission Charges) Rules 2021

Land acquisition for green

hydrogen production Allotment of land in renewable energy parks for green hydrogen/ammonia production

Source: Ministry of Power, Government of India, 2022

73 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Manufacturing zones proposed to be set up for cluster based development of green hydrogen supply chain
Green hydrogen policy enablers (cont.): Manufacturing zones

Manufacturers of green hydrogen / ammonia allowed to set up bunkers near ports for storage and exports by
Bunkering and storage shipping. Land to be provided for storage by port authorities at applicable charges.

Renewable energy consumed for production of green hydrogen / ammonia shall count towards RPO compliance of
RPO compliance the end-user entity. Renewable energy consumed beyond obligation of end-user shall be counted towards RPO
compliance of DISCOM in whose area the project is located.

MNRE will establish a single window portal for all statutory clearances, permissions required for manufacture,
Single window portal transportation, storage and distribution of green hydrogen / ammonia preferably within 30 days of
data of application

MNRE may aggregate demand from different sectors and have consolidated bids for procurement of green
Demand aggregation hydrogen / ammonia through designated implementing agencies

‘Electricity (Promoting Renewable Cross subsidy surcharge and additional surcharge shall not be applicable if green energy is utilized for production
Energy Through Green Energy of green hydrogen and green ammonia
Open Access) Rules, 2022’.

Source: Ministry of Power, Government of India, 2022

74 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Green Hydrogen Policy notified in Feb’22 is a timely intervention for the industry betting on
the promise of establishing competitive supply chains
India’s ‘Green Hydrogen Policy’ will kick start energy transition efforts, particularly in the Similarly, the effectiveness of few other provisions in the green hydrogen policy such as
emission intensive industrial sectors. granting open access for renewable energy sourced within 15 days and land allocation in
renewable energy parks will depend on the efforts from State governments towards
One of the key highlights of this policy, the waiver of inter-state transmission charges for
proper adoption and enforcement.
green hydrogen production plants commissioned up to June 2025 sourcing electricity
produced from renewable energy sources was already existing from the order dated 23rd
The ‘Electricity (Promoting Renewable Energy Through Green Energy Open Access)
November 2021. However, this order had provisioned waiver for first 8 years of operations
Rules, 2022’ notified recently is a step in the right direction to lower the cost of open
only. The ‘Green Hydrogen Policy’ has extended the waiver for 25 years of plant
access renewable energy supply for green hydrogen production. As per these rules cross
operations, which is a welcome step in ensuring long term cost reduction of green
subsidy surcharge and additional surcharge shall not be applicable if green energy is
hydrogen production for the industry. One must note that green hydrogen production units
utilized for production of green hydrogen and green ammonia. India’s green hydrogen
must be connected with ISTS network at the point of GH2 production to fully realize the
policy framework must further evolve to boost demand for green hydrogen through
benefits of this waiver. Otherwise, respective state transmission charges may still apply.
purchase obligations/blending mandates particularly for bulk consumers of hydrogen as
Therefore, States which extend similar waivers for intra-state transmission could
industrial feedstock or process gas. Viability Gap Funding should be extended along with
become preferred locations for green hydrogen production units.
such purchase obligations for bulk consumers of hydrogen as feedstock. Green hydrogen
The policy also provides 30 days banking facility and limits the applicable banking charges blending with piped natural gas is another major market for boosting demand. The policy
for the renewable energy used in the production of green hydrogen. This is also a must focus on boosting R&D investment with public private partnerships (PPP) and
significant step, especially when the restrictions on banking provisions for renewable grand challenges to demonstrate efficient and cost effective GH2 electrolysers, storage
energy are increasing in many states. Banking is permissible only for intra-state and delivery solutions using earth abundant electrocatalysts and materials. A concrete
transactions and therefore the industry will benefit from this provision only when the state roadmap towards developing testing facilities and certification mechanisms relying on
electricity regulatory commissions amend their banking regulations accordingly. Renewable globally harmonised standards and regulations for Green hydrogen production, storage
energy systems designed for green hydrogen production are typically oversized to account and delivery is needed. VGF may also be provided for projects where green hydrogen
for variability. Banking allows green hydrogen producers to supply excess renewable could act as alternate energy carrier for enabling low carbon steel, cement, trucking and
electricity to the grid, with the option of drawing back the same amount of power within a maritime shipping. The policy must also endeavour towards creating world class talent in
certain period and against the banking charges specified by State Electricity Regulatory the value chain of green hydrogen by way of introducing dedicated academic programs/
Commissions. Until recently, many States offered annual banking provisions but have now degrees and establishment of national research institutes. This is important to kick start
moved to a monthly banking period, and in some cases have completely withdrawn banking the indigenization of technology development and support the industry ambitions
facilities for renewable energy projects. Therefore, the industry will watch closely on how towards R&D, product development and services in the entire value chain.
the States which have already restricted banking provisions will adopt the 30 days banking
facility and the formula specified for limiting banking charges specified in the green Overall, the supporting ecosystem required for indigenization of GH2 production needs
hydrogen policy. parallel efforts with incentivizing the end-users for demand creation.

75 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 The following sections highlight key policy interventions to be adopted by ► Waivers, clarity and certainty of open access charges for GH2 production
states (sub-national actors) until green hydrogen supply chain and
State governments should extend waivers for levy of open access charges (e.g.
Recommendations for sub-national
►
adoption achieves sufficient economies of scale.
green hydrogen policy frameworks 1. Reducing the cost of renewable power generation and supply
banking, cross subsidy, additional surcharge etc.) for the first 0.5 – 1 Million
tons of GH2 production to reduce cost and encourage GH2 adoption. If not
for GH2 production viable, open access charges should be kept at minimum with clarity and certainty
of its validity period in the regulations.
Round the clock renewable power generation accounts for 40-50% of the
levelized cost of green hydrogen production and storage (LCOH). Sub- ► Allow banking of surplus energy in the production of GH2
national policy frameworks should aim to minimize the cost of this critical ► Existing open access regulations should be amended for allowing banking of at
supply chain component and significantly improve the ease of doing open least 10% annual generation for min. 30 days in line with national green
access transactions. In this regard, the draft Electricity (promoting renewable hydrogen policy.
energy through Green Energy Open Access) Rules, 2021 notified by Ministry
of Power, Government of India in August 2021 is a step in the right direction. ► Fungibility of green hydrogen and renewable purchase obligations
However, the responsibility of facilitating open access lies with the State ► Open access regulations should specify mechanisms for monitoring, verification,
Electricity Regulatory Commission as per Section 42 and Section 86 of the certification and accounting to enable such fungibility of purchase obligations.
Electricity Act, 2003. Therefore, the central rules and other State level policy
interventions should ultimately manifest as amendments to existing open 2. Improve ease of doing renewable energy open access (REOA)
access regulations at state level for meaningful outcomes. transactions
► Waiver of Intra-state transmission charges for GH2 production Rule#6 and 7 in draft Electricity (promoting renewable energy through Green
Energy Open Access) Rules, 2021 focus on streamlining, centralizing and
The national green hydrogen policy notified in Feb’22 has announced the standardizing open access approval processes for renewable energy transactions.
waiver of inter-state transmission charges for a period of 25 years for green Given delays in processes and existing complex processes, such an approach is
hydrogen production units commissioned before 30th June 2025. However, needed. A centralized registry is proposed to enable single window clearance for
green hydrogen production units must be connected with ISTS network at the REOA applications. The applications are to be routed through the state nodal
point of GH2 production to fully realise the benefits of this waiver. Otherwise, agency which as per Rule 6 (2) would either be the SLDC for STOA and the
respective intra-state transmission charges may still apply. In this regard, CTU/STU for LT/MTOA. As per Rule 7 (2) complete applications are to be uploaded
States that extend similar waivers for intra-state transmission charges will by the nodal agency and in order to prevent delays, applications are deemed
enable industry to gain competitive advantage in the production of green approved after 15 days subject to technical requirements specified by the ERC.
hydrogen. Such waivers can extended for limited periods Or limited for first Further as per Rule 7 (4) and (5) denial of open access should take place with a
0.5 – 1 million tons of annual GH2 production to help achieve economies of written order and the applicant has the right to be heard. Further appeal against
scale. Open access regulations could explore mechanisms to socialize the orders by the nodal agencies are to be processed by the State Commission.
cost of this waiver to reduce fiscal burden. Existing open access regulations should be amended suitably with above
provisions.

76 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 3. GIS mapping and identification GH2 clusters for efficient 6. Production linked incentives and fiscal benefits for high
infrastructure development efficiency and durable electrolyser systems
Recommendations for sub-national
green hydrogen policy frameworks States should undertake GIS mapping of renewable energy resource rich
locations, GH2 demand centres - for example crude oil refineries, fertilizer
Electrolyser systems account for 30-40% of the levelized cost of green
hydrogen production and storage (LCOH). Sub-national policy frameworks
industries, iron and steel manufacturing units, ports, industrial SEZs and
should aim to minimize the cost of this critical supply chain component.
transport corridors (roadways, railways, inland waterways), land use – land
Therefore, States should offer additional incentives (apart from national PLI
cover (LULC) in the vicinity of GH2 demand centres, water bodies for sourcing
scheme if any) linked to production of high efficiency and durable
fresh water used in the production of electrolysis etc. GIS mapping along with
electrolyser systems. Electrolyser systems used in the production of GH2
other geospatial characteristics, potential demand for GH2 and other relevant
should be brought in the lowest GST slab or waived off completely. Import
attributes should be gathered to rank / prioritise various clusters with respect
duties must be kept at minimum until the emergence of local manufacturing
to their inherent capability of supporting a GH2 economy, supply chain and
industry.
consumption.
4. Establish State level mission for advancing GH2 economy, 7. Enhance public funding support towards R&D programs
formulate and adopt GH2 production targets separately for calling for demonstration of projects that support
industries, transportation and other sectors of the economy competitiveness of GH2 supply chain and end-use
States must establish GH2 mission with a governance mechanism for
State budgetary resources should be allocated towards creating centres of
interdepartmental coordination, monitoring and evaluation of policy
GH2 excellence, robust coordination mechanisms to aggregate demand,
interventions. The governance mechanism should include be represented by
cutting edge R&D calling for demonstration of following projects:
energy, industries, and transport departments at the minimum.
► Cost effective high efficiency durable electrolysers made with earth
Robust and predictable demand for GH2 is essential for accelerating
abundant electrocatalyst materials
investments in the supply chain. In this regard, States must adopt short,
medium and long term GH2 production targets separately for crude oil ► Hydrogen based direct reduced iron (H2-DRI) and electric arc furnace
refineries, fertiliser industries, iron and steel manufacturing units, other steel projects
industries, transportation sectors etc. ► Cost effective Hydrogen fuel cell powered transportation solutions
5. Single window portal for all statutory clearances, permissions capable of competing with conventional ICE engine and / Or battery
required for manufacture, transportation, storage and electric systems
distribution of green hydrogen / ammonia ► Cost effective hydrogen storage materials and solutions made from
earth abundant materials
States should establish single window mechanisms in coordination with
central institutions for facilitating all statutory clearances, permissions
required for manufacture, transportation, storage and distribution of green
hydrogen / ammonia.

77 Accelerating India’s clean energy transition 1 2 3 4 5 6 7 8

 Annexures

78 Accelerating India’s clean energy transition

 ANNEXURE I: Battery and component manufacturing projects
Project Pipeline for Manufacturing Advanced chemistry Battery Cells Project Pipeline for Assembling Advanced Chemistry Battery Packs

Production Expected Production Expected

Promoter Government Project Year of Promoter Project Year of
Capacity Capital outlay Location Capacity Capital outlay
type support Status announcement type Status announcement
(MWh/year) (Crores INR) (MWh/year) (Crores INR)

Private PLI scheme 10,000 Announced 7,000 Jan–2022 220 million

Private Haryana pieces Planning 7,083 Aug–2020
Private PLI scheme 5,000 Announced – Jan–2022 per year
Himachal Under
Private PLI scheme 20,000 Planning – Jan–2022 Private 240 – Feb–2021
Pradesh construction
Private PLI scheme – Planning – Jan–2022 Private – 1,000 Announced 300 Jul–2021

Private PLI scheme 5,000 Announced – Jan–2022 Under

Private Telangana 2,400 – Nov–2020
construction
Public PLI scheme – Planning – Jun–2021
Private Uttar Pradesh 1,000 Announced 185 Oct–2021
Private PLI scheme 20,000 Announced – Jan–2022 Private Gujarat – Announced 4,000 Mar–2021
Private PLI scheme 20,000 Announced 2,000 Jan–2022 Private Tamil Nadu 500 Announced 500 Nov–2021

Private PLI scheme 5,000 Announced 4,000 Jan–2022 Under

Private Haryana 240 200 May–2021
construction
Private PLI scheme 5,000 Announced 2,000 Jan–2022
PPP – – Planning Feb–2021
Private PLI scheme – Announced 2,000 Jan–2022 Under
Private Tamil Nadu – Nov–2021
construction
Private – Announced 2,000 Mar–2021
Private – – Announced Feb–2021
Private 5,000 Announced 4,015 Jul–2021
Private Tamil Nadu 1,200 Announced 100 –
Under
Private PLI scheme 10,000 2,500 Aug–2021
construction Private Tamil Nadu 400 Announced –

79 Accelerating India’s clean energy transition

 ANNEXURE I: Battery and component manufacturing projects
Project Pipeline for Manufacturing advanced chemistry battery cell components

Expected Capital outlay

Category Promoter type Production Capacity Project Status Year of announcement
(Crores INR)

Cathode manufacturing Private – Announced 2,000 Oct–2021

Synthetic Graphite 40,000 tonnes of graphite

Private Announced 2,000 Oct–2021
Manufacturing anode by 2025
Anode precursor
Private 15,000 TPA Under construction – Aug–2020
material manufacturing

Recycling Private – Planning – Jun–2021

Recycling Private 11,000 tons Announced 300 Dec–2021

Recycling Private 2000 MWh/year Announced 300 Jul–2021

80 Accelerating India’s clean energy transition

 ANNEXURE II: Green Hydrogen Projects
Green Hydrogen production projects

State of Date of Project Promoter

Hydrogen production or Electrolyzer capacity
Project Location announcement (Public / Private)
PAN India Mar-21 Private
Tamil Nadu Mar-21 Public 500 kW – 1000 kW
Uttar Pradesh Jun-21 Public 50kW, 0.13 TPD
Andhra Pradesh Jul-21 Public 1.25 MW solar plant for green electricity generation source
Ladakh Jul-21 Private
PAN India Jul-21 Private Electrolyzer manufacturing plant: 0.5 to 2GW/year
Karnataka Aug-21 Public 25 kW
Ladakh Aug-21 Public
PAN India Aug-21 Private Electrolyzer Manufacturing plant: 2.5 GW/year
Gujarat Sep-21 Private
2 MW Solar plant to be used for electricity production for
PAN India Oct-21 Private
electrolyser
5 MW PEM Electrolyzer project- 2TPD Hydrogen production plug
Gujarat Oct-21 Public
power make
Madhya Pradesh Oct-21 Private
- Oct-21 Public 4.3 Ton per day (TPD) Hydrogen production
Madhya Pradesh Oct-21 Private 50 kiloton per annum
100 MW in the first phase + a 25 kW self-developed Fuel cell pilot
Madhya Pradesh Nov-21 Public
project
PAN India Nov-21 Public 20 MW

81 Accelerating India’s clean energy transition

 ANNEXURE II: Green Hydrogen Projects
Green Hydrogen production projects

State of Date of Project Promoter

Hydrogen production or Electrolyzer capacity
Project Location announcement (Public / Private)
40 MW/5000MT per annum (Uttar Pradesh) and 15 MW/2000
Madhya Pradesh Nov-21 Public
MT per annum (Haryana)
Uttar Pradesh and Haryana Nov-21 Public 200MW - 2GW
PAN India Dec-21 Private
PAN India Dec-21 Public
PAN India Dec-21 Private >2 GW
PAN India Dec-21 Public
Maharashtra Jan-22 Private 1 GW
PAN India, Europe and UK Jan-22 Private 1 GW
PAN India Feb-22 Private
PAN India Apr-22 PPP
Not reported Apr-22 Public 1 GW
PAN India Apr-22 Private
PAN India May-22 Private

82 Accelerating India’s clean energy transition

 ANNEXURE II: Green Hydrogen Projects
Green Hydrogen research and development projects
Estimated date of project State of Project
Project Category Project name Date of announcement
commissioning Location
Bio-Inspired Hydrogen Evolution from Water:
Green Hydrogen 2019 Jun-22 West Bengal
Troubleshooting Practical Limitations

Development of efficient and robust working

electrodes/photocatalysts for solar energy conversion to
Green Hydrogen 2020 Dec-23 Uttar Pradesh
hydrogen via photoelectrochemical/ photocatalytic splitting
of water: Next level up-scaling of laboratory experience

DEEP: Development of an Efficient Photoelectrode for

Green Hydrogen Jan-19 Jun-22 West Bengal
Hydrogen Fuel from Water
Demonstration and validation of hydrogen ecosystem for
Green Hydrogen stationary power backup application for telecommunication Feb-19 Jun-22 Tamil Nadu
towers
Improved hydrogen production from biogas using sorption
Green Hydrogen Feb-19 Jun-22 Maharashtra
enhanced reforming
2D Transition Metal Layered Double Hydroxides: A
Green Hydrogen CostEffective Catalyst for Hydrogen Production by Jul-21 Mar-24 West Bengal
(Photo)Electrochemical Water Splitting
Development of first-of-its-kind mobile device for production
Green Hydrogen Nov-21 PAN India
of ultra pure green hydrogen
Unraveling the potential of graphene quantum dots for
Hydrogen Storage 2019 Jun-22 Madhya Pradesh
hydrogen storage in fuel cells, DST, India
Hydrogen Storage Materials: Optimization of known
Hydrogen Storage materials, developing new storage materials and finding Feb-20 Jun-23 Uttar Pradesh
exploratory application

83 Accelerating India’s clean energy transition

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84 Accelerating India’s clean energy transition

 Notes

85 Accelerating India’s clean energy transition

 Notes

86 Accelerating India’s clean energy transition

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