As India’s population consistently grows, the demand for Energy in the country is steadily on a rise. Many people still need access to power, and those who have, face daily power cuts in some deficit regions. Energy is most vital for a country’s infrastructure and of utmost importance for the welfare and economic growth of a country. That’s why India needs to catch up in regard to power supply. In order to face this issue, the Indian Government provided financial incentives worth $1 billion between 2013 and 2015 for the set-up of Renewable Energy projects and incentives for power generation. Meanwhile, Renewables in India have attracted FDI worth $14 billion. The Indian Planning Commission, in its 12th 5-year plan, expects Energy production to reach 884 MTOE (Million Tons of Oil Equivalent). The Indian Government plans to reach this and other targets by using Renewable Energies, such as Solar or Wind power. So what are the latest incentives and programs initiated by the Government to support the Energy Industry?
The Government plans to make India an Energy surplus country in the fiscal year 2016, with an overall excess of 1.1% through a targeted production of 1178 billion power units. In the Paris Climate Change commitment, India promised to source 40% of its generated power from Renewable Energies in future. Still, large amounts of Energy are produced by using coal. This means more emissions and in consequence a negative effect on the climate. Therefore, India should also target crude oil and natural gas for their Energy production. India has an unused capacity in those fields, and now wants to offer 67 small oil and gas fields for bidding, so that these resources can be used. India wants to become more investor-friendly regarding the crude oil and gas sectors, and offers tax incentives to attract investors to these plants.
India’s target for Renewable Energy capacity for 2022 is an installed capacity of 175000 MW, with a Solar Energy target of 100 GW. To achieve this target, the country needs to continue investing into the Solar sector. In the beginning of June, it has been announced that investments for research on clean Energy will be doubled within the next 5 years to $145 Million. Private investors already invested $7 billion into Wind Energy, $4.5 billion into Solar Energy, and $1.1 billion into Bioenergy products over the last two fiscal years. India’s investment into Renewable Energies in 2015 alone has been $10.2 billion. This helps India to realize new projects, as well as overhaul e.g. old wind power stations. The capacity addition for Wind Energy increased to 3.3 GW in FY 2015/16.
India also wants to add more than 93 GW of Solar power capacity. India strategically has a very good location to produce Solar Energy, as it has long sunshine hours. But not only solar parks will help India’s Energy production rise. Solar panels installed on private rooftops are also a great opportunity to increase Energy production through Renewables. Additionally, India wants to support the storage of solar generated power so that Solar Energy could finally become a 24×7 Energy supplier by 2020. The cost of building and installing solar panels has drastically sunk in the last decade. This affordability can further promote solar power installations and therefore, increase Renewable Energy shares.
Just recently, India and the US agreed to focus on clean Energies and to set up investment incentives in Solar Energy in India. The two countries also want to set up a $20 Million US-India green Energy Finance initiative to attract investments up to $400 Million. This initiative could provide clean Energy to up to 1 Million households in India by 2020.
Additionally, India and the EU will work together to facilitate policy dialogues and bring business solutions, innovations and best practices to India. The European Investment Bank also gave loans of around $1.35 billion to support climate and Energy related projects in India, for example in Agriculture.
India is taking all these steps in order to make the country a forerunner in green Energy technologies and to reduce emissions from Energy production and dependency on Energy imports. Still, this needs time and another unfinished project ‘Power for All’ remains, but with continuous investments and strategic implementation of new Renewable Energy plants as well as the usage of oil and gas resources, India can make its way forward to become an Energy surplus nation.
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