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ENERGY AND UTILITIES SECTOR OVERVIEW

Statistics, news & updates: everything you need to know about the Energy & Utilities Sector in India

Energy and utility sector of India - Maier Vidorno Altios India

Summary/Snapshot​

Energy and Utilities Industry

  • India was ranked fifth in both wind and solar power and fourth in renewable power installed capacity, as of 2020. Over the next five years, the government has set out US$ 42 billion in the Union Budget 2021-22 for a redesigned, reform-based, and result-linked new power distribution sector scheme.
  • With a potential capacity of 363 GW and favorable policies, Northern India is expected to become the hub for renewable energy in India.
  • India is building a solar power plant in Rajasthan, which will be the world’s largest with a capacity of 2,255 MW.
  • Up to 100%, FDI is allowed under the automatic route for renewable energy generation and distribution projects
  • India wants to cut its GDP emissions intensity to 35% by 2030 and boost the use of non-fossil fuels to 40% of total electricity generation capacity. India is on track to exceed its nationally determined target of 40 per cent non-fossil-fuel capacity by 2030.
  • In 2020 hydro-based generation declined by 8.2%, while nuclear-based generation climbed by 4.6%. Nuclear Power Corporation of India intends to build 5 nuclear energy parks with a total capacity of 10,000 megawatts.
ENERGY & UTILITIES SECTOR OVERVIEW - Maier Vidorno Altios India

Growth Drivers​

The Government plans to :

  • Double the share of installed renewable energy electricity generation capacity to 40% by 2030.​
  • Reduce emissions intensity by 33% – 35% below the 2005 levels and increase the share of non-fossil fuel in total capacity to ~40% by 2030​
  • Have 60 solar cities approved and $1.3 bn allocated for setting up 50 solar parks of 40GW by 2020.
  • Establish a renewable energy capacity of 523 GW (inc. 73 GW from Hydro) by 2030.​

Sub industries

  • Oil and Gas Drilling and Production
  • Pipeline and Refining
  • Mining Companies
  • Renewable Energy
  • Chemicals

Opportunities

  • Over the next five years, the government has set out US$ 42 billion in the Union Budget 2021-22 for a redesigned, reform-based, and result-linked new power distribution sector scheme.
  • Under the Green energy corridor program, the government plans to set up 12600 km of inter-state and intra-state transmission lines.

Challenges

  • High AT&C losses: Arising due to issues with tariffs affect the ability of distribution companies (discoms) to buy power to supply to the consumers
  • Inadequate generation capacity: In the last few years, the capacity to generate electricity has increased but the actual generation of electricity is still low because of a shortage of fuel especially coal and unviable Power Purchase Agreements.
  • Shortage of fuel: Increasing power generation costs due to limited fuel availability.
  • Differential tariff structure: Supplying electricity at a tariff lower than the cost to supply, along with delays in tariff revisions has led to discoms facing huge financial losses.
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Key Investment Opportunities

  • The Government of India has announced that it will create 5 GW of offshore wind energy projects by 2022 and 30 GW by 2030 as part of its “National Offshore Wind Energy Policy” to attract major investment for the growth of the offshore wind energy sector in India.
  • By 2022, the ‘Grid Connected Solar Roof Top Programme’ aspires to have a total capacity of 40 GW from Rooftop Solar (RTS) Projects. The initiative would be implemented through DISCOMs with a total central financial contribution of INR 11,814 crore.
  • One of the most important criteria for the expansion of New & Renewable Energy is research, development, and demonstration (RD&D). The Ministry of New and Renewable Energy (MNRE) encourages research and development to develop new and renewable energy technologies, processes, materials, components, sub-systems, products and services, standards, and resource assessments so that new and renewable energy systems and devices can be manufactured locally.

 

Recent Developments

  • As the country continues to adopt clean technologies, there will be a growing penetration of renewable energy into the grid, and more independent microgrids – solar, wind, biomass, battery energy storage, waste-to-energy – will continue to power communities.
  • Private LTE and 5G will play a crucial role in the management of future grids by enabling grid edge automation, real-time asset management through drone-based line inspection, VR/AR, and teleprotection.
  • By 2050, more bioenergy will be added to the energy landscape. It is estimated that liquid biofuels will surpass petroleum products which is fuelling the industry and transport sector.
  • India will continue to invest in processes, technologies, end-use energy efficiency, and carbon footprint reduction. Besides, market-driven mechanisms, such as peer-to-peer energy trading, carbon pricing, congestion-based pricing, and green certificate trading will become more innovative with AI/ML, which will stimulate reallocation of capital and resources to fund these opportunities.

Key Players in India

National

  • Adani Power Ltd.
  • CESC Ltd.
  • Gujarat Industries Power Company Ltd.
  • Indraprastha Power Generation Company Ltd.
  • NHPC Ltd.
  • NTPC Ltd.
  • Nuclear Power Corporation Of India Ltd
  • Tata Power​
  • Power Grid Corporation of India Ltd
  • Rattan India Power Ltd.​

International

  • GE Power​
  • IBDRY
  • Constellation Energy Corp.
  • NextEra Energy
  • Jinko Solar Holding Co. Ltd.
  • CSIQ
  • SunEdison
  • Vestas Group
  • BEPC
  • Daqo New Energy Corp.
  • AQN
ENERGY & UTILITIES SECTOR OVERVIEW - Maier Vidorno Altios India

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