The criticality of a robust power sector for India’s post-Covid journey of economic revival with climate consciousness cannot be overemphasised. Several recent policy initiatives are expected to go a long way in strengthening the Indian power sector. These include increased electrification due to schemes such as the Deen Dayal Upadhyaya Gram Jyoti Yojana, the Ujwal Discom Assurance Yojana, the Integrated Power Development Scheme and the Revamped Distribution Sector Scheme (RDSS). To this end, India has a project investment of around Rs 335 billion (24 per cent) in the power sector as part of the National Infrastructure Pipeline and allocations are made in the Union Budget 2021-22 of Rs 3,030 billion for the reforms-based RDSS over the next five years; and Rs 40 billion to invest in wind energy, solar energy and the green energy transmission corridor.
However, significant structural challenges threaten to derail these. There are imperatives of changing our consumption and production pattern to mitigate the climate crisis, by accelerating our transition from thermal to renewable energy, with its attendant costs and stranded asset implications. India is decisively fast-tracking the transition of its energy sources to renewables – seeking to install 500 GW by 2030. The Covid crisis exacerbated the financial health of the sector, which must be addressed with urgency.
Please click here to read views by Amit Kapur published in Powerline.