Power is one of the most vital components of infrastructure, critical for a nation’s growth and well-being. The presence and development of suitable electrical infrastructure are critical for the Indian economy’s long-term prosperity. The fundamental principle of India’s power industry has been to provide universal access to affordable power in a sustainable way. Over the last few years, the Ministry of Power has made significant efforts to transform the country from a power shortage to a surplus one by establishing a single national grid, fortifying the distribution network, and achieving universal household electrification.
The electricity industry in India is one of the most diverse in the world. Power generation sources range from traditional coal, lignite, natural gas, oil, hydro, and nuclear power to viable non-conventional sources such as wind, solar, agricultural, and domestic waste. Electricity demand in the country has risen rapidly, and is expected to rise even further in the coming years. To meet the country’s growing demand for electricity, massive increases in installed generating capacity are required.
Current scenario of the power sector in India
On the World Bank’s Ease of Doing Business – ‘Getting Electricity’ ranking, India rose 115 places – from 137th (2014) to 22nd (2020). Between FY19 and FY23, the Indian power industry is expected to receive investments of $128.24-135.37 billion. The sector’s future is bright, as the country’s installed power generation capacity is expected to reach 620 GW by 2026-27, with 38 per cent coming from coal and 44 per cent from renewable energy sources.
Renewable energy generation (solar, wind, hydro, and biopower) grew from 193.5 billion units in 2013-14 to 306.3 billion units in 2020-21, representing a 6.8 per cent CAGR. BHEL commissioned about 119.5 MW of captive power plants in FY 2020-21, whereas 75 MW of captive power plants were commissioned during FY 2021-22 through September 2021.
As of August 2022, the total installed capacity was 405.8 GW, with renewablethird-largest accounting for 40.2 per cent. Coal-based thermal power production capacity is predicted to be 32 per cent of the energy mix in 2030. With a Plant Load Factor of 94.2 per cent, Odisha’s NTPC Talcher Kaniha (3000 MW) is the best- performing thermal power plant. According to the most recent significant world energy data, India is the world’s third-largest generator of power as of December 2021.
Challenges encountered with power distribution across the state
The country’s ability to sustain industrial expansion, investment, and economic competitiveness remains hampered by a lack of reliable power. Electricity shortages are expected to cost the country 7 per cent of its GDP. Electricity generation/supply has expanded at a rate of only 5.3 per cent per year on average.
Improved sector performance is required to ensure long-term and inclusive growth. India faces significant challenges in the power sector, such as:
Inadequate access to modern energy:
With a predominantly rural population and little access to contemporary energy services, there is a heavy reliance on traditional fuels: non- commercial biomass remains a substantial energy source, accounting for more than 30 per cent of the country’s fuel mix. Over 350 million people still do not have access to power. In rural areas, limited access to modern energy sources reduces productivity, particularly for agricultural labourers seeking non-farm employment.
High reliance on fossil fuels, notwithstanding vast untapped renewable energy potential:
India’s electricity industry continues to rely significantly on fossil fuel (coal). While it has a huge hydropower potential (150,000 MW), it is tiny in comparison to the country’s energy demands and relatively unexplored (only 25 per cent potential has been harvested so far).
More than 60 per cent of businesses and a considerable proportion of households rely on captive or backup generation – The reported peak power shortfall is 10.3 per cent, and the energy deficit is 8.5 per cent, but actual electrical shortages on the ground are significantly larger. The reliability, fuel economy, and environmental performance of about 27,000 MW of existing coal-fired generating capacity must be upgraded.
Considerations for sustainability and climate change are becoming increasingly important:
The sector development strategy calls for a greater dependence on coal to satisfy energy demands. Despite low per capita emissions, India is the world’s sixth largest GHG emitter, accounting for 4 per cent of global GHG emissions. Coal-fired power stations account for 65 per cent of the total capacity in the nation, accounting for 50 per cent of CO2 emissions. While CO2 emissions are expected to rise until at least 2040, India has the opportunity to take a lower or higher carbon route, depending on its policies, institutions, and foreign assistance.
Priorities of the Government:
The present grid-connected generating capacity in India is around 177,000 MW (65 per cent coal, 22 per cent hydro, and 13 per cent other). While the government of India works to enhance the capabilities of the public sector, it is simultaneously supporting a paradigm shift in order to build up public-private partnerships (PPP) in the sector. At the moment, the private sector handles just 21.9 per cent of grid-based generating and 12 per cent of distribution.
The way forward
Access to energy, like access to clean water or food, is a basic human necessity. India has met its objective of supplying power to all of its homes. The next issue is to provide consistent, high-quality energy without interruption in order to completely fulfil rising demand. To accomplish so, distribution businesses must be perceived in the market as reputable buyers of power who pay their bills on time. The gains made in having sufficient generating capacity in the country, largely through private investment in recent years, with renewable energy capacity almost entirely created by private investment, risk being jeopardised if markets lose faith in the distribution sector’s financial turnaround.
The government aims to electrify all villages, providing access to all rural households and free connections to all below-poverty-line families, with the goal of achieving universal access and an annual minimum level of consumption of 1000 kWH by 2022.
Government aims:
- Add 80,000 MW of generation capacity within the next five years (four times the historical five-year average), including 16,000 MW of hydropower.
- Expand small and medium hydro, wind, and biomass to increase renewable energy from 4 per cent of installed capacity to 10 per cent by 2022.
- Increase the percentage of solar energy to 20,000 MW by 2020 under the Government of India’s National Solar Mission.
- Rehabilitate and update about 27,000 MW of ageing coal-fired power stations.
- Increase the proportion of supercritical power plants in new installations to 20 per cent.
Need for technology, and how it will help the society/state to grow
The power grid is on a life-changing, rapid-fire path. Consumers, as in many altered industries, are at the centre of a disruptive combination of digital technological developments; consumer involvement; on-demand, personalised consumption; and a decentralised infrastructure. In the middle of this rapidly changing new energy environment, we must guarantee that the future of electricity is established on the proper track.
Consider that worldwide energy consumption will rise by 30 per cent by 2040. At the same time, about 2 billion people continue to lack access to reliable electricity. Now is the moment to bridge the energy gap by managing energy demand while allowing for more global access. This will necessitate maintaining clean energy at the forefront of change.
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What must be done
We are in the midst of the Fourth Industrial Revolution, which “builds on the digital revolution and integrates various technologies that are leading to significant paradigm upheavals in the economy, industry, society, and individuals,” according to the World Economic Forum.
There are three trends that are causing game-changing disruptions
Rapid technical advancements in the electrification of some energy applications, such as heating and electric cars
The transition from centralised power plants to decentralised power plants, which means that energy is now created, stored, and delivered closer to where it is needed owing to solar, wind, and other renewable energy and storage technologies.
Intelligent metering and a digital network infrastructure allow consumers and utility companies to “see” — and better control — where, when, and how electricity is used, allowing for more efficient consumption and cost management.
Future landscape of the power sector in India
The installed capacity of Indian power plants is currently 404 GW, with 58 per cent being fossil power plants, and overall power demand is estimated to reach 817 GW by 2030, nearly doubling. And India has promised to provide 50 per cent green energy for the globe by 2030 in order to battle global warming/climate change and reduce the carbon footprint, as well as to achieve “Carbon Neutral” or “Net Zero” emissions by 2070. In the same vein, India plans to build 450 GW of power plants using renewable or green energy.
Out of 450 GW renewable energy, 280 GW will be installed as Solar Power Plants by 2030, and only 58 GW has been implemented thus far. All of India’s biggest industrialists and businessmen are investing in solar and hydrogen fuel. Energy consumption per capita will rise as a result of Indians’ lifestyles, Crypto Currency Mining Servers, Cloud Servers, Electric Vehicles, Smart Home Appliances, Make in India / Aatma Nirbhar Bharat Projects, Start-Up Projects, and so on.
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