The Economic Survey 2022-23, which was tabled in the Parliament today ahead of the budget sessions, said that India has become a popular investment destination for renewables over the last few years.

It said that between 2014 and 2021, the country attracted a total investment of $78.1 billion in the renewable energy sector. Investment in renewables remained close to or exceeded $10 billion annually since 2016, except for a dip in 2020 due to the COVID-19 pandemic.

Most of the funding in India was domestically sourced, using government funds, markets, and tax breaks among other measures.

As the country aims to achieve net-zero emissions by 2070, the Long-Term Low Emission Development Strategy, the survey said that India showed that this goal required tens of trillions of U.S. dollars in investments.

India is now focusing on attracting more private investment to secure sufficient financing for the net zero goal.

Green bonds

The Reserve Bank of India announced a schedule for issuing sovereign green bonds for the 2022-23 financial year.

The first issuance was held on January 25 for ₹80 billion (~$977.96 million), and the second, for ₹160 billion (~$1.95 billion), will be held on February 9, 2023.

The bonds were split into 5 and 10-year options, with ₹40 billion (~$488.98 million) allotted for each term at both auctions.

SEBI expanded the definition of green debt security to include new sustainable finance modes for pollution prevention and control and eco-friendly products.

The market regulator also introduced subcategories of green debt securities, including blue bonds for water management and marine sectors, yellow bonds for solar energy, and transition bonds.

SEBI’s data on green debt securities showed that from 2017 to September 2022, 15 Indian corporations had issued green bonds worth ₹45.39 billion (~$554.84 million), most of which were used for funding renewable energy projects.

Electric Vehicles

The automotive sector is crucial in the shift to green energy. The domestic market for electric vehicles (EVs) is projected to expand at a 49% compound annual growth rate from 2022 to 2030, reaching annual sales of 10 million units by 2030.

The EV industry is expected to generate 50 million direct and indirect jobs by 2030.

The EV market in India reached a milestone in 2022, with sales surpassing one million units, a year-over-year increase of over 300%.

Green hydrogen

The survey said that India could benefit from the growing trend towards green hydrogen, which is crucial for reducing emissions in sectors such as fertilizers, refining, methanol, shipping, iron & steel, and long-haul transport.

The government approved the National Green Hydrogen Mission with an initial allocation of ₹197.44 billion (~$2.41 billion), aiming to make India energy self-sufficient and decarbonize key sectors.

The mission aimed to create demand, produce, use, and export green hydrogen, attracting over ₹8 trillion (~$97.8 billion) in investment by 2030.

A report by NITI Aayog predicted the cumulative value of the green hydrogen market in India would reach $8 billion by 2030 and $340 billion by 2050, with the electrolyzer market estimated at $5 billion by 2030 and $31 billion by 2050.

Green hydrogen is expected to result in a cumulative reduction of 3.6 giga tons of CO2 emissions by 2050 and provide significant energy import savings, stability in industrial input prices, and long-term improvement of foreign exchange reserves.

Installed capacity growth 

The total installed power capacity of utilities and captive power projects (industries having demand of 1 MW and above) was 482.2 GW on March 31, 2022, as compared to 460.7 GW on March 31, 2021, up by 4.7%.

Installed capacity in utilities was 399.5 GW on March 31, 2022, as against 382.1 GW a year back (higher by 4.5%). Thermal energy sources make up the largest (59.1%) share of total installed capacity in utilities, followed by renewable energy resources with 27.5% and hydro with 11.7%.

Renewables generated approximately 1.7 GWh of power in 2021-22. This is a 16% YoY growth compared to 1.5 GWh.