Accelerating India’s
clean energy transition
Prepared for India Energy
Transition Summit
June 2022
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We acknowledge contributions from
Somesh Kumar

Mohammad Saif

Shuboday Ganta

Partner & Leader – Power & Utilities
Strategy and Transactions (SaT)Partner – Power & Utilities
Strategy and Transactions (SaT)Vice President – Power & Utilities
Strategy and Transactions (SaT)EY India

EY India

EY India

Aaron Cherian

Aditya Prakash

Utkarsh Mathur

Senior Associate – Power & Utilities
Strategy and Transactions (SaT)

Senior Associate – Power & Utilities
Strategy and Transactions (SaT)

Associate – Power & Utilities
Strategy and Transactions (SaT)EY India

EY India

EY India

Vipul Tuli

Shivanand Nimbargi

Ganesh Srinivasan

Prabir Neogi

Chair, FICCI Power
Committee & CEO, South
Asia - Sembcorp Industries

Co-Chair, FICCI Renewable
Energy CEOs Council and
MD & CEO, Ayana Power

Co-Chair, FICCI Power
Committee & CEO,

Mentor, FICCI Power
Committee and Chief
Adviser – Corporate Affairs,
RP-Sanjiv Goenka GroupTPDDL.

Jyoti Vij,

Arpan Gupta

Nishit Jain

Shikha Jain

Kalyan Verma

Deputy Secretary
General, FICCI

Additional Director

Senior Assistant Director

Senior Assistant Director

Senior Assistant Director

FICCI

FICCI

FICCI

FICCI

Vikas Mehta

Kartikeya Singh

Rita Roy Choudhury

Executive Director

Director of Programmes

SED FundSED FundFormer Assistant Secretary
General, FICCI

2

Accelerating India’s clean energy transition

Foreword

Mr. Arun Chawla,
Director General,
FICCI
India is pioneering a new model of economic
development that could avoid the carbonintensive approach. The use of renewableenergy not only helps in the primary objectivesof advancing economic development andmitigating climate change but also improvesenergy security and access to energy.
The Hon’ble Prime Minister has laid out India’s
commitments towards climate action at CoP26
Summit in his ‘Panchamrit statement’ as fivepoint action agenda. India’s commitment toenergy transition and non-fossil energy
capacity coupled with several positive steps
taken towards sustainable development shows
our country’s leadership and strength. It also
highlights on the firm intent of theGovernments to move rapidly towards carbon
reduction and net zero.

3

Accelerating India’s clean energy transition

To achieve the targets envisaged, Energy
Transition will be the most important pillar
moving ahead. FICCI as the apex businessorganization in the country has been
supporting the Government with its inputs andactivities in this crucial area and we are now
pleased to present a well-researched report –‘Accelerating India’s Energy Transition’ incollaboration with EY.
This report highlights the initiatives required tocreate a robust ecosystem to enable the energy
transition. The report covers clean energy
opportunities currently under development project pipeline as well as signifies their impact
on economic development, job creation andenvironment sustainability. It also provides key
recommendations to overcome impediments tothe clean energy growth in India.
We hope this report will provide useful inputs
to the Government, Industry and stakeholders
to drive next wave of energy transition in Indiaand stimulate policy direction on the subject.
I take this opportunity to place on record our
gratitude to FICCI Renewable Energy CEOs
Council, FICCI Power Committee and othersfrom the industry and government for theirvaluable insights.

Foreword

Mr. Somesh Kumar
Partner & Leader(Power & Utility),
EY India
The impacts of COVID pandemic and theongoing conflict in Ukraine is a stark reminder
on how India’s dependence on energy imports
and other commodities linked to global supply
chains can threaten its strategic interests. In
this context, the ongoing energy transition is aboon for India’s long term energy security,
sustainability and self-reliance.
India’s thriving renewable energy markets andenabling policy ecosystem has helped retain its
position among the top 3 markets globally in
the EYs ‘Renewable Energy Country
Attractiveness Index’ (RECAI).
Decarbonization, decentralization, digitization
and aatma-nirbharta are the four building
blocks of India’s energy transition. Equitable
and affordable energy access for all to meet
economic development objectives is nonnegotiable in this transition. At the same time,energy efficiency and environmental
sustainability remain the key drivers of thistransition.
4

Accelerating India’s clean energy transition

Power sector is currently leading the energy
transition efforts globally including India
enabled by rapid decline in the cost ofintermittent solar and wind energy sources forelectricity production. However, the availabilityof competitive long duration energy storage
technologies will determine the speed and scaleof the transition in this sector going forward. In
the hard to abate sectors such as
manufacturing (e.g. steel, cement, ammoniaetc.) and transport that rely heavily of fossil
fuels, green hydrogen is emerging as apromising low carbon feedstock / energy
carrier. The competitiveness of thesetechnologies along with enabling policy
ecosystem will determine the speed and scaleof the transition in future.
In this report, EY has identified over ~650
‘shovel-ready’ energy transition investment
opportunities at various stages ofdevelopment. This pipeline shows tremendous
potential for capital deployment and othersocio-economic benefits in terms of
employment generation and avoided CO2
emissions. Moreover, these projects are criticalto accelerate India’s energy transition and playa key role in achieving India’s long term
commitments towards climate change
mitigation.

CONTENTS

Section 1

Section 2

Section 3

Section 4

Executive summary

Setting the context
for India’s Energy
Transition: Building
blocks and policy
enablers

Frameworks forenergy demandplanning and ‘JUST’transition

Decarbonizing
India’s electricity
grid with utility
scale RE power
generation

Section 5

Section 6

Section 7

Section 8

Decentralization of
power systemthrough distributed
generation

Advancingself–reliant supply
chains forsustainable energy
transition

Pipeline of EV
charging
infrastructure
projects

Enabling Green
Hydrogen policies
to decarbonize
manufacturingsectorAnnexures

5

Accelerating India’s clean energy transition

Acronyms
AC

Alternate Current

International Energy Agency

PPA

Power purchase agreement

ACC

Advanced Chemistry Cell

BCD

Basic Custom Duty

Indian Renewable Energy Development Agency
Limited

PSA

Power sale agreement

BESS

Battery Energy Storage System

ISTS

Interstate transmission network

PSU

Public sector undertakings

Commercial & IndustrialkWkilowatt

PV

Photovoltaic

CAGR

Compound Annual Growth Rate

LiB

Lithium ion Battery

CAPEX

R&D

Research and Development

Capital Expenditure

LOA

Letter of Award

CEA

Central Electricity Authority

LTA

Long–term access

CERC

Central Electricity Regulatory Commission

CFA

Central Financial Assistance

CPSU

Central Public Sector Undertakings

DCR

Domestic Content Requirement

Mt

DHI

Department of Heavy Industries

Mtoe

Million tons oil equivalentDistribution Company

MW

DPR

Detailed Project Report

EESL

C&I

IREDA

MNRE
MoP

Ministry of New and Renewable Energy
Ministry of Power

RE
RESCO

Renewable Energy
Renewable Energy Service Company

RPO

Renewable Purchase Obligation

RTC

Round–the–clock

RTPV

Rooftop Solar Photovoltaic

Megawatt

SCOD

Scheduled Commercial Operational Date

NHM

National Hydrogen Mission

SECI

Solar Energy Corporation of India Limited

Energy Efficiency Services Limited

NSEFI

National Solar Energy Federation of India

EPC

Engineering, Procurement and Construction

NTPC

National Thermal Power Corporation Limited

SERC

State Electricity Regulatory Commission

EV

Electric Vehicle

O&M

Operation and Maintenance

SPPD

Solar Power Park Developer

EY

Ernst & YoungOEM

Original equipment manufacturer

SPVSpecial Purpose Vehicle

FICCI

Federation of Indian Chambers of Commerce &Industry

OPEX

Operating Expenditure

GT&D

Generation, Transmission & Distribution

PERC

Passivated Emitter and Rear Cell

GW

Gigawatt

PHC

Primary Health Center

UT

Union Territory

GWp

Gigawatt Peak

PLI

Production Linked Incentive

VGF

Viability Gap Fund

Pradhan Mantri Kisan Urja Suraksha evam
Utthaan Mahabhiyan

WHO

World Health Organization

DISCOM

ICAR –
CAZRI

6

IEA

Indian Council of Agricultural Research Central
Arid Zone Research InstituteAccelerating India’s clean energy transition

MSME

PBI

PM–
KUSUM

Micro, Small & Medium Enterprises
Million tons

Procurement based incentive

UMREPP

Ultra Mega Renewable Energy Power Park

Executive summary

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7

Accelerating India’s clean energy transition

Robust planning and predictable growth in demand for clean energy sources is essential for
accelerating energy transition investments
Decarbonization, decentralization, digitalization and aatma-nirbharta are the building
blocks of India’s energy transition to ensure equitable and affordable energy access forall. Energy transition is fundamental to achieving long term economic development andsustainability objectives. Market outlook towards increasing share of electricity and otherlow carbon fuels in final energy consumption and gradual phasing out of coal andpetroleum products in the primary energy mix are the defining characteristics of energy
transition.

Incentives for fossil to electricity transition technologies and solutions, particularly for
manufacturing industries can help accelerate inorganic growth of electricity demand in
the economy. Further, implementation of reforms to improve financial health ofelectricity distribution sector is fundamental to the bankability of energy transition
related investments. Implementation of ‘Draft Electricity (Promoting RE through Green
Energy Open Access) Rules, 2021’ can help MSMEs and other consumers having 100
kW & above connected load with greater options for sourcing renewable energy.

Rapidly evolving energy transition technologies rising demand for clean energy sources
and policies are the key enablers for driving market-based investments. Power sector isleading India’s energy transition driven by rapid decline in cost of intermittent solar andwind energy sources. However, availability of scalable long duration energy storage
technologies at competitive prices will determine the speed and scale of transition in the
power sector going forward. Energy storage is critical to build adequate flexibility acrossthe power system value chain (GT&D) and integrate high shares of intermittent renewableenergy sources. In this regard, viability gap funding for initial uptake of long durationenergy storage technologies looking beyond Li-ion chemistry is necessary. Whereas,green hydrogen is rapidly emerging as an alternative low carbon energy carrier/vector todecarbonize manufacturing and transport sectors, which account for ~32% of India’s GHG
emissions. In the short to medium term, manufacturing industry will lead the way for
scaling up production and end-use of hydrogen, while transport and power sector
solutions, business models will evolve in the long term.

Eventually, India’s energy transition may leave coal and petroleum industries,
communities and workers exposed to decline in demand for fossil fuel commodities in
the long term. Understanding and addressing the social dimensions of energy transitionis critical to ensure that fossil fuel communities are not overly disadvantaged or left
behind. Taking action to address the potential disparity in the economic and social
outcomes from the inevitable transition can be labelled a just or equitable transition.
Globally, there is a growing recognition among institutional investors that these social
considerations should form part of the broader response to the risks and opportunities
inherent in the energy transition.

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Accelerating India’s clean energy transition

Coordinated and harmonised framework for integrated resource and electricity
demand planning, particularly at the state level► Incentives for fossil to electricity transition technologies and solutions,particularly for manufacturing industries to accelerate inorganic growth► Implementation of reforms to improve financial health of electricity distributionsector► Formulate national policy framework for closure / phase-out / re-purposing of
coal-based power plants and mines focusing on Just Transition principles andgoals► Formulate energy storage policy with viability gap funding for initial
uptake of long duration energy storage technologies►

Policy interventions

Robust and predictable growth in demand for clean energy sources is essential for
accelerating energy transition investments. There is a need to restructure the frameworkof integrated resource and electricity demand planning in order to undertake technology,
portfolio mapping and enhance coordination, especially at the state level for
harmonization of techniques and reporting with greater degree of granularity. States
must focus on conducting least cost generation expansion planning backed by optimal
dispatch simulation at an hourly resolution for spot years (e.g., 2025/2030/2040). Suchplanning should also be accompanied by modelling network constraints and grid stability
analysis for validating integration of high shares of renewable energy for spot years.

Theme: Robust planning and predictable growth in demand for clean energy
sources

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India must build resilience against forces threatening the affordability of energy transition
technologies, raw materials and commodities used for domestic production

One of the principal reasons behind the rising cost of solar modules is supply chain
disruptions, especially raw materials and commodities used in the manufacturing of solar
panels. Polysilicon is the critical raw material used in solar PV module manufacturing.
Between July 2020 and April 2022, polysilicon price in the global markets increased 5-6
times. Other disrupting factors in the PV module supply chain include price hikes forcommodities such as glass and basic metals (steel / aluminium), shortage of containers
etc. Such disruptions exacerbated further due to various COVID-19 induced lockdowns
across the world leading to halting of manufacturing activity.
The impact of BCD imposition on imported PV cells would taper down in the medium tolong term term as India builds sufficient PV cell manufacturing capacity planned under the
existing solar PLI scheme. However, sustained higher cost of commodities, raw materials(polysilicon) and logistics used in the supply chain of solar PV modules is a major threat toenergy transition. Therefore, the current solar PLI scheme must focus on building
sufficient manufacturing capacity of 98% grade silicon from quartz, polysilicon, ingots andwafers, all critical components used in the production of solar PV cells and modules.
Moreover, with the increase in GST rate from 5% to 12% on renewable energy equipment(at the project level) the new effective rate of GST on wind and solar energy services
comes to around 13.8%. Government of India should explore reversing this increase in
GST rate for providing partial relief from rising solar panel prices to the consumers.

9

Accelerating India’s clean energy transition

The government of India recently announced import duty cuts for critical raw materials
used in the iron, steel and plastic industries with the intention to reduce their prices fordomestic consumption. Similar interventions could be explored to provide relief for
critical commodities used in solar module manufacturing such as glass (e.g. soda ash)and aluminium (e.g. pet coke, caustic soda), which could benefit the consumers of solar
PV panels.
Lithium-ion battery packs currently attract 30-40% taxes (import duty@15% and
GST@18%) for consumers. These advanced chemistry battery packs will remain thedominant technology for electrification of mobility and stationary energy storage
applications critical for integration of intermittent renewable energy sources through2030. The ACC PLI scheme envisages to add 50 GWh of manufacturing capacity in thenext 2-5 years with up to 60% of local value addition. The consumers could benefit fromimmediate relief from import duties and GST rates until the domestic manufacturing
capacity is established for catering to the local demand. Any safeguard duties to protect
the local manufacturers can be formulated in consultation with the industry.

Theme: Building resilience against forces widening the gap between
sustainability and affordability of energy transition technologies

Policy interventions

Rising cost of domestic solar PV panels could delay the pace of energy transition in India.
Studies from leading market research firms show that solar module prices have increased
between 30-50% in the past two years. Some critics may attribute the rise in solar module
prices to imposition of BCD on imported PV cells (25%) and modules (40%) effective from
April 2022. This is not entirely accurate. As per the data compiled by a leading solar PV
market intelligence and research firm, solar module prices have become increasingly
unpredictable and volatile since the inception of COVID in 2020. Solar module prices(mono PERC) in the global market increased from August 2020 to November 2021 by
42%. On similar lines, solar module prices (mono PERC) in India also increased from
August 2020 to November 2021 by 40%.

Re-imagine solar PLI scheme to focus on manufacturing critical raw
materials (polysilicon) and upstream value chain components► Reverse GST rate to 5% for providing partial relief from rising solar panel
prices to the consumers► Extend import duty cut reliefs for critical raw materials imported in the
production of glass and aluminium, commodities used in solar panels► Rationalize tax rates (import duty and GST rate) for lithium ion battery
packs until the domestic manufacturing capacity is established for cateringto the local demand
►

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Methodology for building energy transition investment pipeline
EY is collaborating with the industry to inform the ‘shovel–ready’ energy transition
investment opportunities in the pipeline. These opportunities help achieve the rightbalance between economic development and energy transition goals by Government ofIndia. The principal objectives of this collaboration are as follows:► Identify ‘shovel ready’ low carbon investment opportunities under development –‘project pipeline’► Assess what is at stake in terms of impact on economic development, jobs andenvironment► Build consensus on stimulus action to accelerate energy transition investments in theeconomic development plans
EY has identified over 650 ‘shovel–ready’ energy transition investment opportunities in
the pipeline with tremendous potential for economic development, jobs and ultimately
contributing towards India’s long–term climate objectives. Project level information was
gathered from primary and desktop research tools including consultations / interviews
with project developers, OEMs, investors etc. with the support of a leading market
research agency. Proprietary databases were also leveraged to identify the long list of
infrastructure projects in the pipeline. The “shovel–ready” projects identified are having
the desired potential to create social, environmental and economic value in theimmediate future. The assessment of employment potential in this report includes jobs
created under supply chain (OEMs), construction / installation, commissioning,
operations and maintenance of projects.

~650 low carbon infrastructure
projects in the pipeline

Renewable
power
generation

Limitations
The project pipeline identified in this report represent just a fraction of the overall low
carbon infrastructure investment under development in India. The project pipeline wasput together from our assessment of their status of development until March 2022.
These projects illustrate the huge potential that exists across India to underpin the
speed and scale of energy transition. This is only a fraction of all low carbon
infrastructure projects under development in India. It is important to note that the
project pipeline identified in this report is illustrative and should not be read as a fullpolicy/commercial endorsement.

10

Accelerating India’s clean energy transition

Thematic
coverageof low carbon
investment
opportunities
in pipeline

Energystorage

Manufacturing
original RE
equipment

EV charging
infrastructure

H2
Green
HydrogenSources: EY and JMK Research’s own tracking of RE auctions from central and state agencies, projects emerging from Government
schemes promoting clean energy transition; National Infrastructure Pipeline hosted by Invest India; Other proprietary databases

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Overview of energy transition investment pipeline
Establish a national index along with regional sub-indices for RE pricing by pooling ofprices / tariffs discovered from RE auctions►

Formulate model policy for aggregation and allocation of wasteland parcels for thedevelopment of gigawatt scale RE power parks►

Implement wholesale power market reforms, time of day pricing and demand response
frameworks to enhance flexibility for RE integration►

Implement the ‘Electricity Amendment Bill 2021’►

Enhance skilling initiatives to support RE industry for project execution

Theme: Distributed generation through rooftop solar PV systems
Policy inter..

►

Adopt best practices from Gujarat and Kerala models of scaling up RTPV
implementation, especially in the residential sector►

Frame policy and regulatory incentives to Promote utility owned / driven businessmodels for RTPV capacity addition►

Promote enabling mechanism for aggregation of 'distributed energy resources' toprovide grid-related services►

Project pipeline
and impact►

Project pipeline
and impact

Policy interventions

Theme: Utility scale RE power generation

360

103 GW

INR 1.12

projects

of pipeline capacity

lakh crore equity

INR 2.61

7.9 lakh

3,989 MTlakh crore debt

fresh jobs

avoided CO2 emissions

99

2.0 GW

INR 913

Projects

of pipeline capacity

crore equity

INR 2,129

18,00080 MTcrore debt

fresh jobs

avoided CO2 emissions

Design and implement credit risk guarantee mechanisms to support RTPV financing for
MSMEs

Policy interventions

Theme: Green Hydrogen production

11►

Incentives to lower the cost of renewable power generation and supply for GH2
production►

GIS mapping and identification GH2 clusters for efficient infrastructure development►

Offtake guarantees similar to SATAT scheme for GH2 suppliers►

Prescribe GH2 purchase obligations / blending mandates for bulk consumers ofhydrogen as industrial feedstock along with viability gap funding

Accelerating India’s clean energy transition

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►

Generation-based incentives for decentralized grid connected ground mounted solar PV
systems co–located with crops on agriculturally productive land parcels►

Dedicated financing facility for improving farmer access to low cost debt funds andboosting commercial viability of 1-2 MW scale ground mounted Solar PV projects on
CAPEX mode

Project pipeline
and impact

Policy interventions

Theme: Distributed RE generation under PM-KUSUM

23

8.7 GW

INR 6,855

Projects

of pipeline capacity

crore equity

INR 16,000

78,500281 MT

crore debt

fresh jobs

avoided CO2 emissions►

Reimagine the ACC PLI scheme to promote local value addition via battery materials
recycling industry►

Implement grand innovation challenges for solar PV and energy storage industry topilot and demonstrate cost effective, durable technologies made from earth abundantmaterials►

Re-imagine solar PLI scheme to focus on manufacturing critical raw materials(polysilicon) and upstream value chain components

Project pipeline
and impact

Policy interventions

Theme: Original RE equipment Manufacturing

78.2 GW/Year 114 GWh/Year78
Projects

Solar cell/
module pipeline capacity

Battery cell/pack pipeline capacity

INR 1.48

INR 3.48

9.33 lakh

lakh crore equity

lakh crore debt

fresh jobs

12►

Promote coupling of EV charging with low–cost renewable energy systems►

Rationalize GST on Lithium-ion batteries to improve competitiveness of energy storage
services and support emerging battery swapping industry►

Promote electric utility-driven business models for setting up
EV charging Infra►

Promote smart charging, time of day pricing, demand response and other alternate
revenue levers for EV charge point operators and investors

Accelerating India’s clean energy transition

Project pipeline
and impact

Policy interventions

Theme: EV charging infrastructure70

5 lakhProjects

EV stations

INR 1.4

15 lakhlakh crore capital investment

fresh jobs

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Setting the context for India’s
Energy Transition: Building
blocks and policy enablers

2
13

Accelerating India’s clean energy transitionSelf–reliance, energy efficiency and environmental sustainability are the key drivers ofIndia’s energy transition
929

80%

3%

800

400

20%

200

0%

0

13%

2000
2010
Coal
Natural Gas
Modern Renewables

44%
6%

2019

2020
Oil
Traditional Biomass
Transformation losses

Primary Energy Demand
25%

1000

600

441

40%

9%

880

700

60%

Change in primary energy
demand 2000–19
150

1000
800

Oil
Traditional Biomass
Transformation losses

100

600

Mtoe

Coal
Natural Gas
Modern Renewables

Mtoe

India’s per capita energy consumption
and emissions is less than half of global
average in the present scenario. As per
the ‘India Energy Statistics 2021’, net
energy import dependency is a whopping
42% and the energy intensity has been
gradually reducing at 2.56% (CAGR) in
the last decade.

Primary Energy Demand in India (disaggregated)
100%

400

50

200
0

0
2000

In the above context, energy security,
energy efficiency and environmental
sustainability naturally become the key
drivers of India’s energy transition.

2010

Transformation losses
Traditional Biomass
Oil

2019

2020

Industry

Modern Renewables
Natural Gas
Coal

Transport

Coal
Electricity
Transformation losses

Buildings Agriculture
Oil
Bioenergy*Note that ‘Modern Renewables’ depicted in the charts above includes all uses of renewable energy (hydro, nuclear, solar, wind, modern biofuels etc.) with the exception of traditional use of solid biomass.
Source: IEA 2021

14

Mtoe

Primary Energy Mix (2020)

As per the IEA’s ‘India Energy Outlook
2021’, the primary energy mix iscurrently dominated by coal and oil
contributing ~44% and ~25% respectively
in 2020. Modern renewables contributeonly ~3% of overall primary energy
demand in the present scenario. The
share of traditional biomass, primarily
used as cooking fuel, is graduallyshrinking. The total primary energy
demand has grown at ~4% (CAGR) in thelast two decades. The industry, transportand building sectors witnessed thehighest incremental primary energy
demand in the last two decades. Coal is
the mainstay for power generation andindustrial energy use.

Accelerating India’s clean energy transition

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Energy transition must prioritize equitable and affordable energy access for all to meet
economic development objectives
India’s per capita energy consumption and emissions is less than half of global average in the present scenario. This is expected to rise substantially with rapid economic development as
more people in the low income category are lifted out of poverty. The government must therefore prioritize equitable and affordable energy access for all in this transition. Further,
India’s CO2 emissions has been increasing rapidly from 0.98 billion tons in the year 2000 to ~2.5 billion tons in 2019 as per IEA 2021. Energy transition in this context should support
the decoupling of economic development and emissions intensity of primary energy consumption.

Key indicators in India as a percentage of global averages
CO2 emission per capita
Coal demand per Capita
Oil demand per Capita
Energy demand per Capita
GDP per Capita
0%

40%

50%

60%

7%
33%

80%

Mt CO2

20%
30%
2000
2019

Sectorwise CO2 emissions

100%

60%
40%

10%

93%

20%

27%

30%

43%

18%
100%

15%

40%

37%

Industry

Transport

57%

0%
Power
Coal Plants
Cars

Iron & SteelResidential

CementServices

Source: IEA 2021

15

Accelerating India’s clean energy transition

Buildings
TrucksOthersOther energy &agriculture

High income state(per capita)
GDP>$10,000

2-3 wheelers

Medium income state(per capita)$10,000>GDP>$5,000

Low income state(per capita)
GDP<$5,000

Source: IEA 2021

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Market outlook towards India’s energy demand and emissions indicate the speed and scale ofenergy transition
As per IEA’s ‘India Energy Outlook 2021’, in the more optimistic sustainable
development scenario, total primary energy demand and total final consumption will see
a modest growth of 7% and 13% respectively by 2030. Whereas, electricity demand will
see a robust growth of 59% by 2030 in that scenario, largely driven by renewableenergy sources. CO2 emissions from energy sector will contract by 4% indicating thatenergy related emissions may peak in this decade. Most importantly, the share ofelectricity in total final energy consumption is expected to rise up to 24% aselectrification of mobility and industrial applications (fossil fuel to electricity) gains
further momentum. By 2030, Coal’s dominance in primary energy mix will end with amodest share of 46%. Low carbon gases such as compressed biogas and greenhydrogen could contribute 2% of total final consumption by 2030.

3000

3.5
3
2.5
2
1.5

1000

1

500

0.5

0

0
2019
Base

2030

2040

2030

STEPS

Sectoral share of total final energy consumption
100%

Primary Energy Demand (MToe)

Final Energy Consumption (Mtoe)

Electricity Demand (TWh)CO2 emission (Gton: Right Axis)

Accelerating India’s clean energy transition

11%

12%

27%

35%

11%

14%

13%

25%

22%

23%

22%

23%

22%

60%
50%
40%

21%

17%

30%
20%

36%

40%

42%

41%

43%

2019

2030

2040

2030

2040

10%
0%

SDS

Source: IEA 2021

16

2040

The Sustainable Development Scenario (SDS) explores how India could mobilize an
additional surge in clean energy investment to rapidly decline in emissions,consistent with a longer–term drive to net zero, while accelerating progress towards
a range of other sustainable development goals.

70%

CO2 Emission (Gton)

4

1500

►

80%

3500

2000

The Stated Policies Scenario (STEPS) provides a balanced assessment of thedirection in which India’s energy system is heading, based on today’s policy settingsand constraints.

90%

India’s energy demand and emissions outlook

2500

►

Base

STEPS
Industry

SDS

Transport

Buildings

Other

Source: IEA 2021

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Increasing share of electricity in final energy consumption and gradual phasing out coal in
primary energy mix is the defining characteristic of India’s energy transition
Source wise share of total Primary energy demand
100%
1%
90%

20%

4%

80%
6%

70%

20%

1%

2%
9%

11%
60%

12%

13%

2%

As per the IEA India Energy Outlook 2021, share of coal in India’s primary energy mix
could reduce from 45% in the base scenario to 32% in the more optimistic SDS
scenario by 2030.

►

Similarly, the share of electricity in total final energy consumption could increase
from 17% in the base scenario to 23% in the more optimistic SDS scenario by 2030.

9%

10%

15%
2%

►

2%

2%

4%

3%

*Note that in the charts depicting primary and final energy consumption, the share of ‘bioenergy’ is decreasing and may seemcounter intuitive in the context of energy transition. However, this includes both traditional biomass (fuelwood, animal waste,charcoal used as cooking fuels) and other modern biofuels (bagasse, ethanol, compressed biogas etc.). The reduction in share of‘bioenergy’ for the periods 2030 & 2040 is primarily driven by continued pivot away from traditional biomass and a steady uptakeof appliances powered by electricity or other modern cooking fuels.

15%

12%

Total final energy consumption

3%
6%

26%
27%

90%

50%

26%

16%

29%

1%

18%

14%

20%

24%

6%

9%

11%

35%

36%

34%

18%

17%

16%

18%

15%

2019

2030

2040

2030

2040

25%

17%

60%
30%

23%
45%

20%

34%

30%

32%

10%

18%

2%
11%

23%

30%

10%
12%
38%
29%

20%
10%
0%

0%
2019

2030

Base

Coal

Oil

2040

2030

STEPS

Natural gas

Nuclear

2040

Base

SDS

Hydro

Source: IEA 2021

17

50%
40%

40%

1%
10%

80%
70%

40%

0%

0%

100%

Accelerating India’s clean energy transition

Bioenergy

Other renewables

Coal

STEPS

Oil

Natural gas

SDSElectricity

Bioenergy

Other renewables

Source: IEA 2021

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Role of nuclear energy as base load resource needs detailed examination to accelerateenergy transition
As per CEA’s optimal generation mix report for 2030,
electricity demand is likely to increase to 340 GW(peak) and 2,325 BU by 2030. Nuclear energy
currently contributes 2% of the capacity and 3% ofenergy mix. It is worthwhile to explore the role ofnuclear energy as baseload resource for aiding theclean energy transition through 2030 and beyond.
This can reduce dependency on coal-based thermal
generation which is the mainstay of baseload
generation in the current scenario. The government
should form a technical committee with relevant
stakeholders to study the feasibility of this transition.

Electricity Demand Projection
2047
299

2000

2325
340

300

1566
226

1500

350

250
200

1000

150
100

500

50
0

0
2021-222026-27

9%

2%

32%

Thermal
64%

36%

13%

7%
2%

NuclearRenewable Sources

Coal

Lignite

Hydro

Gas

17%

Nuclear

Solar

Wind

18

Accelerating India’s clean energy transition

Coal

Gas

2%

3%

8%

9%

23%
50%

77%

12%
1%

Electrical Energy Requirement (BU)
Source: CEA 2019

Biomass

Optimal energy mix, 2030

Optimal energy mix, 201911%

1%

2029-30

Peak Electricity Demand (GW)

2%

55%

21%

Hydro

400

Optimal power generation
capacity mix, 2030
3%

Peak Electricity Demand (GW)Electricity Requirement (BU)

2500

Optimal power generation
capacity mix, 2019

Hydro

NuclearRenewable Sources

Thermal

Hydro

Nuclear

4

5

Solar

Wind

Biomass

Source: CEA 2019

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Coal

Gas

Role of Hydro Power for Grid Related
Services to accelerate energy transition

Action Plan for Pumped Hydro Storage(PHS) Development

As per CEA’s optimal generation mix report for 2030, the capacity of hydro generation
is expected to rise from 46209 MW in FY 21 to 71128 MW by 2029-30 [including
10151 MW of Pumped Storage Hydro plants]. It is worthwhile to expand the role ofhydro power in providing grid-related services for aiding clean energy transition. Thereis a need to undertake identification of reservoir and pondage-based hydro capacities
for delivering grid security services as outlined below, drawing a monetization plan byvalue stacking to generate multiple revenue streams basis plant characteristics, ramp
rates and pricing strategies to maintain project viability and also, providing policy inputs
for regulatory and market-based interventions as necessary:

Till the time technology cost curve for battery storage systems improves, pumped
storage will remain a viable alternative to provide grid balancing services. To develop
the required emphasis, developing a road map is necessary for plotting new capacities
at potential sites, which will provide the options of minimum displacement of habitats
and damages to ecology and environment under the categories of both ‘open loop’ andoff-river (‘closed loop’) PHS installations. Examining the scope of setting up PHS
installations under existing sites with pondage and reservoir capacities is also an optionthat may be exercised. An enabling mechanism will be the introduction of dynamic
pricing in wholesale markets so that a monetization plan reflecting the temporal gridrelated services can be offered to PHS installations to allow commensurate cost
recovery.

►flexibility services for serving peak load, diurnal and seasonal variations and acting
as both back-up and spinning reserve►

part load operations to meet system imbalances in real time and at 5 / 15 minute andhourly intervals►

primary response services, including frequency control and inertia, as grid ancillary
operations►

reactive power support in synchronous condenser mode operation►

black start support to power plants to restore grid outages

19

Accelerating India’s clean energy transition

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Pumped hydro storage (PHS) projects under pipeline are critical to enhance flexibility in thegrid
As per CEA, the total hydro power
generation capacity (Existing + Under
construction + Planned) considered for
optimal generation mix by 2030 is 64 GW,
out of which ~9% is expected to be pumped
storage type. The existing capacity of hydropower projects working in pumped storage
mode (>25 MW) is ~3305 MW. Another~1500 MW is under active construction,~2200 MW capacity is under examinationand ~3850 MW capacity is under survey
and investigation where both reservoirs
exist. Similarly, ~6400 MW capacity isunder survey and investigation where one
reservoir needs to be constructed andanother ~6500 MW capacity where bothreservoirs need to be constructed.
PHS is a mature and scalable energy
storage technology, accounting for over
~90% of installed global energy storage
capacity in the present scenario. PHS is a
type of hydroelectric energy storage whichuses a two-reservoir system (upper andlower) to store energy and generate
electricity. It is of two types: ‘open loop’,
which is connected to a natural-water
source for one or both the reservoirs; and‘closed loop’ (or off-river PHS), which has
no outside water bodies connected toboth reservoirs.

20

Accelerating India’s clean energy transition

Optimal hydro power
generation capacity mix
by 2030

9.0%
22.8%
18.6%

49.6%

Storage hydroRun off river
Multipurpose hydroPumped Storage hydroSource: CEA 2019

PHS can store surplus renewable energy and supply electricity during peak hours continuouslyfor 6-10 hours, depending on the storage capacity of the upper reservoir. PHS systems have alifetime of over 40 years, with roundtrip efficiency of 70 – 80%. Also, when compared to theconventional thermal generators, PHS has a higher ramping capability (ability of quick startstop). These features enable PHS to provide multiple services to integrate high share of
renewables to the grid at competitive prices. But there are challenges too, including a high initialinvestment (USD 600- 2000/kW), topographical requirements like the range for elevation (201000 m) between the two reservoirs, proximity to a large water body, and environmental
impacts like loss of wildlife habitats and issues of resettlement and rehabilitation of humanpopulation. The Central Electricity Authority of India has estimated a PHS potential of 96 GW,
but only 3.3 GW is currently operational in India. This slow pace can be attributed to the highcost associated with the commissioning of PHS plants, the long gestation period due to delays in
obtaining environmental clearances, and the low recovery from the existing pricing mechanismof PHS. The high cost and environmental clearance issues can be resolved using a closed-loop
PHS system that utilizes less water, has a low gestation period, and minimal impact on theenvironment. A 2019 study by Australian National University (ANU) estimates that there are
16,000 closed-loop PHS sites in India,
with a combined energy storage capacity of 56,000 gigawatt-hours.
Introduction of dynamic pricing in wholesale markets and concurrent TOD retail tariff to reflect
time value of energy will be necessary to enable PHS to respond to grid-related services in realtime operations and benefit from a monetization plan for cost recovery.. Today the bulk ofwholesale electricity markets in India are governed by long term purchase agreements withDISCOMs. These agreements do not differentiate the value of electricity supplied on the basis oftime of day and / Or season. Part of the problem is that the retail prices (end–user tariffs) are
fixed round the clock for most categories of consumers. Time of day tariffs are mandated
selectively for high tension category industries only with options for voluntary adoption in few
other categories in select states. With rising share of low cost intermittent renewable energy
sources supplying abundant electricity during day time and monsoon months, dynamic pricing isessential for rewarding discharge of surplus/excess renewable electricity from PHS at times thegrid needs most – evenings, early mornings etc. More importantly, dynamic pricing mechanisms
are essential for enhancing the arbitrage value of electricity storage.

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Building blocks for India’s energy transition
Decarbonization
India has set a target of 500 GW non–fossil, fuel–based energy generation by 2030 and economy wide net–zero emissions by 2070. Power sector is currently
leading the decarbonization drive with approx.105 GW of installed RE capacity dominated by Solar and wind energy sources. Another ~112 GW of RE
projects are in the pipeline under various stages of development. In the hard to abate sectors such as iron and steel, cement, chemicals, fertilizers, othermanufacturing, and transportation, there are a multitude of promising clean energy technologies (e.g., electrification enabled by heat pumps, batteries, fuelcells and other energy storage systems, green hydrogen, biofuels such as methanol, ethanol, biogas, and bagasse) competing for transition from fossil fuels.
Energy efficiency in transformations and end–use, achieving cost parity with conventional fossil fuels will determine the speed and scale of this transition.

Decentralization
Renewable energy sources, inherently distributed in nature, can be utilized efficiently, when harnessed locally at the point of consumption. Distributed RE
generation will grow to contribute substantially more than the utility scale systems, which are constrained by land, evacuation infrastructure build out andsuboptimal capacity utilization. Energy utilities will need to rapidly embrace this transition and diversify with new business models and services in order toremain relevant. The Government programs promoting rooftop solar PV, rural micro–grids and decentralized RE systems under PM–KUSUM will further
accelerate this transition. The centralized power grid will gradually transition from being the main source of power supply to a flexible reserve for banking
surplus energy from distributed RE systems. C&I consumers will find decentralized RE services more competitive in the immediate future. Emphasis on
evolution of grid edge technologies and compensatory frameworks will be necessary to enable large-scale onboarding of distributed energy resources inproviding grid optimization services. Going forward, value streams will be generated by offering the range of services through aggregation of decentralized
distributed resources and grouping them as Virtual Power Plants (VPP).

Digitalization
The digitalization of energy system through the deployment of information and communications technologies is gaining rapid momentum withdecentralization. This digitalization is making it easier to compute and communicate the value of energy services with finer temporal and spatial granularity.
This will enable energy demand to become increasingly responsive to changes in the prices of those services and participate actively in their provision.
Digitalization in combination with the new clean energy resources, is enabling networks to become more actively managed, potentially ending the passive
network management paradigm, in which networks are sized to meet the aggregate peak demand of passive consumers. Also, the energy utilities will need toramp up cyber security systems and capabilities to manage the vulnerabilities from this transition.

Aatmanirbhar Bharat
The speed and scale of India’s energy transition will rely on building robust self–reliant supply chains for critical clean energy technologies and solutions. The
Production Linked Incentives (PLI) announced for manufacturing high efficiency solar PV cells and modules, advanced chemistry battery cells and electricvehicles are steps in the right direction to accelerate this transition. The approved list of models and manufacturers of solar PV cells and modules is
continuously evolving and expanding its scope. More importantly, India’s energy transition will leave coal and petroleum industries’, communities andworkers exposed to decline in demand for fossil fuel commodities. Understanding and addressing the social dimensions of the clean energy transition is
critical to ensure that particular communities, workers and their families are not overly disadvantaged or left behind.
21

Accelerating India’s clean energy transition

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Ecosystem enablers: Technological advancements driving energy transition
Long Duration Battery Energy Storage – a key enabler

Enables low cost
renewableenergy to bedispatched atpeak times
Replacement ofthermal power
generation by costcompetitive battery
storage in future“Battery on Wheels”
as a grid resource
Battery energy
storage to enable
flexibility acrosspower system
value chain

Utility scale battery
storage brings
competition in the
ancillary market
Behind-themeter markets
with prosumers
as new entrants

22

Accelerating India’s clean energy transition

Virtual transactive
micro-grids forgrid managementand deferringinvestments

Battery energy storage enhances large-scale renewable generation dispatching ability
in order to meet the demand which was traditionally supplied by conventional
baseload generation. By virtue of having quick discharge capabilities and round trip
efficiencies, battery storage systems can support grid balancing by participating inwholesale capacity, energy and ancillary services markets and in particular, are aneffective tool for both frequency control and voltage regulation in real time
operations. Additionally, they provide the benefit of capex deferral in T&D
infrastructure and is a non-wire alternative in the hands of the utility to optimize
system and fuel costs, reduce congestion costs, firm up RE capacities againstintermittencies and decarbonize the energy mix.
Battery storage can store renewables at times of low demand and dispatch during highdemand periods when energy cost is high.

Battery energy storage for stationary grid applications must evolve
beyond lithium-ion technologies for long duration storage capabilities
and competitivenessThe stationary storage industry will need advanced chemistry battery cells enabling
long duration storage cycles (>15 hours per cycle), and long life (number of charge –discharge cycles) at competitive prices for boosting demand. High performance Li-ion
batteries with high energy density and round trip efficiency are more suited formobility applications and less suited for multiday and beyond storage. Levelized costof energy storage is a key performance parameter for stationary BESS solutions andhas to compete with levelized cost of energy from fossil fuels for scaling up adoption
in India. In the near future, short duration (up to 10 hours per cycle) energy storage
applications are likely to be satisfied with continued reduction of Li-ion batteries. In
the long term, increasing penetration of solar and wind power sources in the energy
mix will drive development of new, ultra low cost battery chemistries made from earth
abundant elements.

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Technological advancements driving energy transition: Hydrogen production nomenclaturePartial
OxidationGreyhydrogen

TurquoisehydrogenHydrogen in fossil fuels

Natural gas

Gasification

SMR

ATR

Pyrolysis

GreenhydrogenElectricity generation fromwind and solar energy

Electrolysis(ALK/PEM/SOEC)

YellowhydrogenHydrogen derived fromorganic matter

Photolysis

Microbial
production

Biomass
gasification

IndustryenergyBuilding
HeatingIndustry
feedstockGridelectricity

Othersources

Nuclearpower

Carbon Capture Utilization and storage (CCUS)

When CO2 iscaptured, greyhydrogen becomes blue.

23

Accelerating India’s clean energy transitionPowergeneration

Transportation

1

2

3

4

5

6

Electrolysis(ALK/PEM/SOEC)

7

8

Technological advancements driving energy transition: Electrolysis for Green Hydrogen►

Hydrogen is essential to decarbonize
the hard-to-abate sectors(manufacturing and transport), which
accounted for ~32% of India’s GHG
emissions in 2016.

►

Industry will lead the way, whiletransport and power business models
will evolve in the coming decade.

►Oil refineries using hydrogen fordesulphurisation, ammonia
production for fertilisers andchemicals industry, treatment ofbasic metals are the leading market
opportunities for green hydrogen in
the short-medium term.

►

OutputH2 Storage

H2 Compressor

Electrolyzer (DC)Green hydrogen technologies andapplications as alternate energy
carrier / vector for industrial process
heating, transportation and long
duration energy storage will emerge
in the long term.

InverterPower (DC)
HydrogenElectricity (AC)PV(DC)

Battery (DC)Electricity (DC)24

Accelerating India’s clean energy transition

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Carbon Capture, Utilization, and Storage (CCUS)
►

►

►

25

As per the IEA, Carbon Capture,
Utilisation, and Storage (CCUS) refers toa suite of technologies that can play animportant and diverse role in meeting
global energy and climate goals. CCUS
involves the capture of CO2 from large
point sources, including power
generation or industrial facilities that use
either fossil fuels or biomass for fuel. The
CO2 can also be captured directly fromthe atmosphere. If not being used onsite, the captured CO2 is compressed andtransported by pipeline, ship, rail or truck
to be used in a range of applications, or
injected into deep geological formations(including depleted oil and gas reservoirs
or saline formations) which trap the CO2
for permanent storage.
A challenge to be overcome is to locate
appropriate geological formations andabandoned mines / well heads which canoffer the facility of storing or
sequestrating CO2.

Indian industries and public sector
undertakings (PSUs) are leading the way
towards the promotion of CCUS facilities
while recognizing the need to staycarbon-neutral in the broader context ofsustainability.

Accelerating India’s clean energy transition

INDUSTRIAL FACILITIESINDUSTRIAL FACILITIESwith carbon capture and storage or utilization

without carbon capture and storage

CO2

CO2 inCO2 inSource: CEEW, 2021

In India, CCUS technology is far from becoming mainstream. The industry is currently exploring ways tostudy and improve techno-economic feasibility and scalability of this technology.

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Tipping points for energy transition in the power sector
Levelized cost of electricity
10.0

9.1

9.0
8.0

7.7

7.4

INR/kWh

7.0
6.0

6.3
5.7

6.6

6.3

5.7

5.0
4.8

4.0

3.4

4.7

3.5

3.0
2.0

2.5
1.8

1.0
0.0
Newly built non pithead coal
power plant – fixed plus
variable (@50% PLF) plustransmission

Newly built pit head coal Variable cost of generation
power plant – fixed plus from Pithead & Non-pit headvariable (@50% PLF) plus
coal power planttransmission

Intermittent PV/Wind/PVWind Hybrid (ISTS
connected)

PV-BESS / Wind-BESS / PV- PV-BESS / Wind-BESS / PV- PV-BESS / Wind-BESS / PVWind-BESS (6 hours) – ISTS Wind-BESS (6 hours) – ISTS Wind-BESS (6 hours) – ISTS
connected (fully installed
connected (fully installed
connected (fully installed
BESS Capex @ $350/kWh) BESS Capex @ $250/kWh) BESS Capex @ $150/kWh)

Source: EY Analysis
Note: Fully installed BESS capex is exclusive of duties & taxes

The cost of energy storage as a service when integrated with intermittent PV/Wind/PV-Wind hybrid systems will need to reach parity with the levelized cost of procurement fromconventional baseload generation. This will determine the speed and scale of energy transition in the power sector going forward. Similarly, grey hydrogen production costs vary
approx. 75-150 INR/kg depending on the price of natural gas in the current scenario. The domestic retail CNG / PNG prices vary approx. 40-90 INR/kg, which translates toapprox. 1-2 INR/Mega Joules of energy considering the lower heating value of this fossil fuel commodity. Achieving parity with these prices will determine the speed and scale ofgreen hydrogen adoption in hard to abate sectors.

26

Accelerating India’s clean energy transition

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Tipping points for energy transition in the hard to abate sectors
Cost for thermal fuel commodities in India
4.0

4

Cost (INR/ MJ)

3.6
3.5

3.5

3.0

3

2.5

2.5
2.2

2.0

2

2.0

1.5

2

1.5

1.3

1.0

1

0.8
1
0.3

0.5

0.0

0.5

0
Steam Methane Coal Gasification
Reforming

Biomass
Gasification

Alkaline
Electrolyzer

Hydrogen Production Methods

LNG.

Retail CNG/PNG Non-Coking coal.

.

Source: DST 2020; IEA 2021; Indraprastha gas limited; National coal index (December 2021)
Note: Cost of hydrogen is exclusive of storage and transportation27

Accelerating India’s clean energy transition

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India must build resilience against forces threatening the affordability of energy transition
technologies, raw materials and commodities used for domestic production
Rising cost of domestic solar PV panels could delay the pace of energy transition inIndia. Studies from leading market research firms show that solar module prices haveincreased between 30-50% in the past two years. Some critics may attribute the rise insolar module prices to imposition of BCD on imported PV cells (25%) and modules (40%)
effective from April 2022. This is not entirely accurate. As per the data compiled by aleading solar PV market intelligence and research firm, solar module prices havebecome increasingly unpredictable and volatile since the inception of COVID in 2020.
Solar module prices (mono PERC) in the global market increased from August 2020 toNovember 2021 by 42%. On similar lines, solar module prices (mono PERC) in India also
increased from August 2020 to November 2021 by 40%.
One of the principal reasons behind the rising cost of solar modules is supply chain
disruptions, especially raw materials and commodities used in the manufacturing ofsolar panels. Polysilicon is the critical raw material used in solar PV module
manufacturing. Between July 2020 and April 2022, polysilicon price in the global
markets increased 5-6 times. Other disrupting factors in the PV module supply chain
include price hikes for commodities such as glass and basic metals (steel / aluminium),
shortage of containers etc. Such disruptions exacerbated further due to various COVID19 induced lockdowns across the world leading to halting of manufacturing activity.
The impact of BCD imposition on imported PV cells would taper down in the medium tolong term term as India builds sufficient PV cell manufacturing capacity planned underthe existing solar PLI scheme. However, sustained higher cost of commodities, rawmaterials (polysilicon) and logistics used in the supply chain of solar PV modules is amajor threat to energy transition. Therefore, the current solar PLI scheme must focus
on building sufficient manufacturing capacity of 98% grade silicon from quartz,
polysilicon, ingots and wafers, all critical components used in the production of solar PV
cells and modules.

28

Accelerating India’s clean energy transition

Moreover, with the increase in GST rate from 5% to 12% on renewable energy equipment(at the project level) the new effective rate of GST on wind and solar energy services
comes to around 13.8%. Government of India should explore reversing this increase in
GST rate for providing partial relief from rising solar panel prices to the consumers.

The government of India recently announced import duty cuts for critical raw materials
used in the iron, steel and plastic industries with the intention to reduce their prices fordomestic consumption. Similar interventions could be explored to provide relief for
critical commodities used in Solar module manufacturing such as glass (e.g. soda ash)and aluminium (e.g. pet coke, caustic soda), which could benefit the consumers of solar
PV panels.
Lithium-ion battery packs currently attract 30-40% taxes (import duty@15% and
GST@18%) for consumers. These advanced chemistry battery packs will remain thedominant technology for electrification of mobility and stationary energy storage
applications critical for integration of intermittent renewable energy sources through2030. The ACC PLI scheme envisages to add 50 GWh of manufacturing capacity in thenext 2-5 years with up to 60% of local value addition. The consumers could benefit fromimmediate relief from import duties and GST rates until the domestic manufacturing
capacity is established for catering to the local demand. Any safeguard duties to protect
the local manufacturers can be formulated in consultation with the industry.

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29

New policy instruments driving energy transition

Ecosystem enablers:

COP26 commitments under
Paris Climate Agreement

Waiver of inter-statetransmission charges

500 GW of
non–fossil energy
deployment by 2030

50% of the energy
requirements fromrenewable energy
sources by 2030

Reduce the total projectedcarbon emission by one billion
tonnes by 2030

Reduce 45%
carbon intensity
by 2030

Achieve net–zeroemissions by 2070

Waiver of ISTS charges for 25 years for solar, wind, hydro PSP, BESS and green hydrogen projects
commissioned until 2025

Electricity (Right of Consumers)
Rules 2021

Net metering by any Prosumer for up to 500 kW or sanctioned load whichever is lower for RTPV installations

Electricity (Promotion ofGeneration of Electricity from
Must–Run Power Plant)
Rules, 2021

Conditions for curtailment or regulation of generationor supply of electricity from solar, wind, hybrid, hydroCompensation for curtailment

Draft Electricity (promoting
renewable energy throughGreen Energy Open Access)
Rules, 2022

Uniform RPO obligations on all obligated entities within
distribution licensee area

Eligibility for 100 kW andabove consumers; No capacity
limit for captive consumers

PLI schemes fordomestic manufacturing ofhigh efficiency solar PV and
ACC battery cells & modules

INR 24,000 crores outlay for PLI scheme focusing onhigh efficiency solar PV cells and modules

Advanced Chemistry Cells (ACC) Battery PLI scheme focusing on 50 GWh
of annual manufacturing capacity

Electricity (Timely recovery of
costs due to change in Law)
Rules 2021

Formula for determination of impact
on tariffs due to change in law

Mechanism for timely adjustment of tariffs

Accelerating India’s clean energy transition

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Single window procedure for grant ofgreen energy open access through acentral nodal agency

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New policy instruments driving energy transition

Ecosystem enablers:
30

Approved list of models
and manufacturers of
Solar PV modules (ALMM)

11 GW of solar PV domestic manufacturing capacity
covered under ALMM

Over 1,000 enlisted models of PV modules
from 39 different manufactures

Domestic content
requirement for government
projects, assisted projects

Government schemes including CPSU scheme, phase 2
of grid connected rooftop solar program and PM–
KUSUM scheme mandate domestic content
requirement for sourcing solar PV modules.

Only models and manufacturers enlisted under ALMM will be eligible foruse in government projects, government assisted projects, projects under
government schemes and programmes, open access and net metering
projects including all projects set up for sale to government

National Hydrogen Mission andGreen Hydrogen Policy

Waiver of ISTS charges for producers forGH2 and green ammonia

Provision of 30 day banking facility to park
surplus renewable energy in the
production of GH2

Sustainable Alternative
Towards Affordable
Transportation (SATAT)

Target production of 15
MMT of compressed biogas(CBG) from 5000 plants by
2023

Battery Swapping Policy(proposed)

Technical, regulatory, operations, financing, and institutional arrangements for battery swapping ecosystem

Ethanol blending

Accelerating India’s clean energy transition

CBG produced will be transported throughcascades or through pipelines to the fuelstation networks of Oil PSUs for marketing as
a green transport fuel alternative.

Single window portal for facilitatingclearances and permissions required for
manufacture, transportation, storage anddistribution of GH2

Oil PSUs have offered Rs 46/- per kg basic price for
procurement of CBG meeting IS 16987:2016
standard compressed at 250 bar and delivered attheir Retail Outlets in cascades.

Raise pan-India ethanol
production capacity from thecurrent 700 to 1500 crore litres

Phased rollout of E10
fuel by April 2022

Phased rollout of E20 from
April 2023, its availability by
April 2025

Rollout of E20 material-compliant
and E10 engine-tuned vehicles
from April 2023

Production of E20-tuned engine
vehicles from April 2025

Nationwide
educational campaign

Encourage use ofwater-sparing crops, such asmaize, to produce ethanol

Promote technology for the
production of ethanol from nonfood feedstock.

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Frameworks for energy
demand planning and‘JUST’ transition

3
31

Accelerating India’s clean energy transition

Energy demand planning needs greater coordination between union andstates, especially in the electricity sector
Coordinated and harmonized framework forelectricity demand planning
The central and state level institutions involved in power system
planning should coordinate more effectively and adopt integrated
resource planning (IRP) with following assessments:➢

Technology and capacity mapping for portfolio design➢

Developing demand scenarios net of DER / DR / DSM impacts with
inputs from States, aggregating at regional / national levels andmerging the data sets under EPS➢

Drawing the framework of resource adequacy for load-generation
balance on hour-on-hour, year-on-year and aggregated basis➢

Providing broad guidance for transmission planning, network
strengthening and corridor identification, including juxtapositionof green corridors

Robust and predictable growth in demand for clean energy sources isessential for accelerating energy transition investments. There is aneed to restructure the framework for electricity demand planning,
especially at the State level in order to enhance coordination andharmonization of techniques and reporting with greater degree of
granularity. States must focus on conducting least cost generation
expansion planning backed by optimal dispatch simulation at anhourly resolution for spot years (e.g., 2025/2030/2040). Suchplanning should also be accompanied by modelling network
constraints and grid stability analysis for validating integration ofhigh shares of renewable energy for spot years.

32

Accelerating India’s clean energy transition

Institutional reforms for ‘JUST’ transition and portfolio
diversification of public sector energy conglomerates

JUST
Transition
Drivers

Understanding and addressing the social dimensions of the clean
energy transition is critical to ensure that communities, workers
and their families are not overly disadvantaged or left behind.
Taking action to address the potential disparity in the economic
and social outcomes from the inevitable transition can be labelled ajust or equitable transition. Globally, there is a growing recognition
among institutional investors that these social considerations
should form part of their broader response to the risks andopportunities inherent in the net zero transition.

Protecting
livelihoods

India’s clean energy transition will leave coal and petroleum
industries, communities and workers exposed to decline in demand
for fossil fuel commodities. There are ~1.2 million workers inIndia’s coal sector, including employees of CIL and private
producers, as well as informal workers in the mining andgeneration sectors, but excluding those from coal transport, which
comprises both rail and road transport. Coal accounts for ~40% of
India’s rail network revenue and the rail sector formally employs
1.3 million people. The coal trucking industry hires about 0.5
million people: truck drivers, coal loaders, and maintenanceworkers for around 150,000 trucks. Clustered around these core
activities are substantial secondary employment opportunities inboth the formal and informal sectors. Much of this employment isfocused in coal-producing states consisting of Jharkhand, Odisha,
Chhattisgarh, West Bengal, Madhya Pradesh, and Telangana. It isestimated that for every formal job in coal, 3–10 additional
jobs/livelihoods are dependent on coal in the coal mining districts.

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Socialinclusion

Balancingwinners andlosersRepurposing
assets78

Economic diversification in coal-dependent communities and businessdiversification of coal/petroleum industries can accelerate JUST transition
In an article titled ‘Bureaucracies for the Better’ authored by an expert, it is argued that theenergy transition policies and technologies, new business models, have been converging forsome time in India with electricity as a common-denominator. The existing institutionalframework governing India’s energy sector faces conflicting incentives. The problem ofconflicting incentives at the institutional level is acute at India’s Ministry of Coal, which has
the mandate to ensure that enough of the black rock is mined domestically to continue
feeding India’s growing electricity demand. Meeting these targets provides essential income tocentral and state governments, while also carrying both revenue and purpose to otherconnected public sector corporations, like Indian Railways, the NTPC, and Coal India Limited,
the mining conglomerate that controls 90% of coal reserves in the country. But this model isunsustainable.
Indian railways has already achieved great strides in electrifying its network, adoption ofrenewable energy for captive use and also announced its ambition to achieve net zero
emissions by 2030. NTPC and Coal India both are pursuing renewable energy investments
aggressively to diversify their portfolio and reduce the risk of locking in fossil fuel investment.
The Indian Oil Corporation is pursuing rapid solarization of fuel retail stations, considering
adding EV charging at thousands of locations, and has started venturing into the hydrogenspace. Bharat Heavy Electricals Limited, the largest power generation equipment
manufacturing firm, has announced plans to making components for EV charging
infrastructure and renewable energy value chain that the country so desperately needs.
Renewable power generation, green hydrogen production, storage and transportation,
upstream manufacturing of polysilicon wafers, ingots, mining of critical minerals essential forenergy transition such as nickel, cobalt, molybdenum, chemical processing for production ofadvanced chemistry battery cathodes etc. are the emerging value chains for businessdiversification for energy conglomerates. In summary, policy packages should determine
JUST Transition pathways and a governance structure with adequate institutional capacity to
implement the measures. A whole-of-government approach will be necessary involving
dialogues at the Central, State and local government levels and actively engaging with
communities, labour unions and civil society organizations in order to ensure that re-skilling,
redeployment and realignment of livelihoods follow an orderly direction and have broad public
acceptance.
33

Accelerating India’s clean energy transition

Estimated potential of renewable energy (MW)Coal dependent
states in focus

Solar (Ground +Rooftop)

Small Hydro PowerWind

Jharkhand

18,180228-

West Bengal

6,260

392

2

Madhya Pradesh

61,660820

10,484Maharashtra

64,320786

45,394Chhattisgarh

18,270

1,098

77

Source: MOSPI, 2021

Reserves of
Nickel Ore

State

Reserves of
Cobalt Ore

Reserves of
Molybdenum Ore

Odisha

175 million tons

31 million tons-

Jharkhand

9 million tons

9 million tons-

Nagaland5 million tons

5 million tons-

Tamil Nadu--

10 million tons

MadhyaPradesh--8 million tons

Karnataka--

1.32 million tons

Source: Indian Bureau of Mines, 2019

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Incentives for fossil to electricity transition technologies and solutions for
manufacturing industries can accelerate inorganic demand growth for electricity
For the manufacturing industries, renewable powered electric heat pumps, boilers and electricarc furnaces could replace fossil fuel furnaces for process low-medium temperatureapplications . However, total decarbonization of this sector, particularly that requires highgrade heat may be difficult purely by means of electrification. This challenge could be
addressed by green hydrogen produced from renewables.
As per CEEW analysis in 2019, the green hydrogen based steel production would supportscaling up of production in meeting the strong domestic demand and provide for about 4
million direct manufacturing jobs by 2050. Further, it would create another 1.6 million jobs
along the hydrogen supply chain, far replacing the fewer jobs involved only in the import andtransport of coking coal. Supporting transition of the domestic cement manufacturing to lowcarbon cement would ensure that the sector would support 0.54 million jobs in 2050, and zero
import dependency on limestone imports. In 2019, MIT researchers demonstrated anelectrochemical processes for low carbon cement manufacturing. The new process centers on
the use of an electrolyzer, in which oxygen-evolving electrode produces acid, while thehydrogen-evolving electrode produces a base. In the new process, the pulverized limestone isdissolved in the acid at one electrode and high-purity carbon dioxide is released, while calcium
hydroxide, generally known as lime, precipitates out as a solid at the other. The calcium
hydroxide can then be processed in another step to produce the cement, which is mostly
calcium silicate. The carbon dioxide, in the form of a pure, concentrated stream, can then be
easily sequestered, harnessed to produce value-added products such as a liquid fuel to replacegasoline, or used for applications such as oil recovery or even in carbonated beverages anddry ice.

To provide the required fillip for investments in transitioning to carbon-neutral processes, itwill be important to develop and scale voluntary carbon markets by incentivizing target
industries to opt in till such time a mandatory carbon market is introduced in the economy.
The measure may prove critical to maintaining the competitiveness of Indian industries if the
proposal of introducing ‘Carbon Border Adjustment Tax’ is implemented by EU and its member
countries. Secondly, to unlock the potential in energy-intensive industries, government
facilitation will be necessary to support R&D in low carbon technologies as well as develop theframework for innovative financing, institute credit enhancement and partial risk guarantee
mechanisms and deploy public funds to attract private capital at scale.
34

Accelerating India’s clean energy transition

Vision for a renewable electricity
powered cement ecosystem

H2
to industry

Combustion

Electricity
Hydrogen

Fuel cell

Oxygen + CO2

Water

Liquid fuels

CaCO2

CCS
CO2U
CA(OH)2

EOR
OxyfuelAluminosilicates

Heat
CementSource: MIT Energy Initiative

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3

4

5

6

7

8

Heat

Pure
CO2

Other measures to enable clean energy demand growth
Reforms to improve financial health of electricity distribution sector
The central financial assistance to state power utilities for promoting performance improvement and reforms should be
conditioned upon implementation of Direct Benefit Transfer, corporate governance, and recovery of government outstanding
to DISCOMs – both subsidy and electricity dues. Structural reforms separating carriage and content should be a priority to
improve last mile efficiencies and governance structure, facilitate consumer empowerment and provide the effective interface
for decentralized distributed generation.

Formulate a national policy framework for coal plant and mine closures / phase out
The Ministry of Power should formulate a national policy framework for coal plant and mine closures / phase out by adopting
JUST transition principles for all. The framework should include provisions for using land, water, existing transmission
networks and re-skilling employees for building and operations of renewable energy facilities. Feasibility of repurposing endof-life coal-based power plants should also be examined for on-site deployment of either stand-alone or a combination of solar
panels, battery storage and synchronous condensers upon assessment of economic benefits and social trade-offs.

Formulate energy storage policy with viability gap funding for initial uptake
The stationary storage industry can compromise on energy density and round trip efficiency of advanced chemistry battery
cells if other performance parameters such as long duration storage (>20 hours per cycle), and useful life (no. of charge –discharge cycles) are superior to existing technologies at competitive prices. The levelized cost of energy storage is a key
performance parameter for stationary ESS solutions as they have to compete with levelized cost of energy from fossil fuels for
scaling up adoption in India. In this regard, energy storage policy must look beyond lithium-ion technology and focus ondevelopment of cost effective long duration capable advanced chemistry battery cells made from earth abundant elements.
Viability gap funding should be provisioned for initial uptake and demonstration of cost-effective technologies.

New regulatory paradigms
New regulatory paradigms will be necessary to usher in the concepts of utility engagement in decentralized service models anddemand side measures, dynamic pricing in wholesale power markets to monetize grid-related services and build value streams,
expanded application of TOD retail tariff and aggregation of distributed energy resources for providing grid-interactive
services. A prudent approach will be to set up Regulatory Sand Boxes for testing these concepts and providing the basis for
informed decision making.
35

Accelerating India’s clean energy transition

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Decarbonizing India’s
electricity grid with utility
scale RE power generation

4
36

Accelerating India’s clean energy transition

Shovel-ready pipeline of utility scale RE power generation projects
India’s renewable energy (RE) based grid interactive power generation capacity has
increased ~7 times since 2010 taking the cumulative installed capacity to ~104 GWp(as of December 2021). Wind and solar PV constitute 48.55 GWp and 40.03 GWp of
the installed power generation capacity respectively in the current scenario. So far in
the current fiscal (FY 22), India has commissioned ~10.6 GW of renewable power
generation capacity with another quarter remaining. India is also leading the global
transition towards renewable energy with initiatives such as ‘One Sun One World One
Grid’ and ‘World Solar Bank’ for harnessing solar energy on a global scale.
There are over 360 utility scale RE based power generation projects in the pipeline led
by both public and private sector. These projects include solar PV, wind, biomass,
battery energy storage systems (BESS) and hybrid RE projects under different stagesof development. Together these projects constitute ~103 GW of contracted capacity
in the pipeline.

Over ~37.6 GW of utility scale RE power generation projects in the pipeline currently
was announced / tendered / auctioned in the year 2021. In recent times, the scale ofHybrid RE projects announced has increased, indicating that the demand for Hybrid
projects is gaining rapid momentum. By blending solar PV, and wind energy sources ata single location or multiple different locations/injection points in the national grid,Electricity Distribution Companies (DISCOMs) / bulk buyers can better manage theintermittency / variability otherwise associated with plain vanilla RE projects. BESS
projects are increasingly announced to integrate high share of variable/intermittent
renewable energy sources into the grid. Open access RE projects are increasingly
adopted by corporates and businesses for optimising power purchase costs, build
resilience from climate change impacts and further accelerate towards net zero
emissions. The ease of doing open access RE projects has improved significantly overthe last one year, which is another key contributing factor.

37

Accelerating India’s clean energy transition

Contracted capacity of utility scale RE power generation projects in pipeline (MW)
Project announcement year

RE Technology

2018

2019

Biomass

2020

2021

2022*

Total
(MW)

15

40

61

6

Floating solar

170

70

34

1,045

360

1,679

Hybrid (Solar +wind)

840

1,820

2,395

2,900

750

8,705

Open access

170

45

7,172

866

8,253

RE + Storage

1,200

20

146

17,5089,764

21,336

10,961

60,959

1,000

6,490

7,490

4,058

3,045

14,25137,672

22,512 1,02,764

Solar PV

1,390

Storage
Wind

5,725

1,423

Grand Total

8,125

22,197

12,258Source: EY Analysis based on JMK Research; *Only projects announced in Jan’22 is included

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3

4

5

6

7

8

1,366

A majority of Solar PV projects are in different stagesof permitting — signing power purchase agreement(PPA), power sale agreement (PSA), tariff adoption
and power procurement approvals from regulators,
financial closure, land acquisition and permission forgrid interconnection. Whereas, a majority of Hybrid
RE projects and BESS projects are yet to complete
price discovery through reverse auctions. About 23
GW of projects have progressed to construction stage
which includes ~7 GW of wind power projects
auctioned over the years. This indicates that India will
add significant capacity of wind power projects in thenext fiscal. Reforms focusing on improving ease ofland acquisition for low carbon infrastructure
projects, grid connectivity and open access will
determine the speed and scale of transition.

Contracted capacity of utility scale RE power generation projects in pipeline (MW)
Project pipeline status*

RE Technology

Announced

Permitting

Total
(MW)

Under Construction

Biomass

61

61

Floating solar

890

444

345

1,679

Hybrid (Solar +wind)

1,950

4,270

2,485

8,705

Open access

4,540

605

3,108

8,253

RE + Storage

111

1,220

35

1,366

Solar PV

16,71734,2699,973

60,959Storage

7,490

Wind

4,545

2,558

7,148

14,251

Grand Total

36,30443,36623,094

1,02,764

7,490~6.8 GWh of utility scale BESS is in the pipeline, mostof which are undergoing the reverse auction process
for competitive price discovery. The CEA in its
optimal generation mix report for FY 2029–30 has
estimated all India BESS capacity addition of 34MW /136 GWh by end of this decade. Most of the MWhscale BESS projects under pipeline aim to provide
renewable energy integrated with BESS as a service
in remote areas of Leh, Chhattisgarh, UP etc.
Whereas, the recently announced GWh scale
standalone BESS projects aim to provide round theclock (RTC) renewable energy as a service and also
optimise capacity utilisation of ISTS (transmission
system) set up for RE integration.

Source: EY Analysis based on JMK Research

Current status of utility scale RE projects in pipeline
100%
80%
60%
40%
20%
0%
Biomass

Floating solar Hybrid (Solar+wind)

Open accessAnnounced

Permitting

RE + Storage

Solar PV

Storage

Therefore, the top use cases emerging of standalone
BESS projects are RE firming, RTC RE supply andbetter capacity utilisation of transmission systems
connecting massive RE projects to national grid.

Wind

Under-construction

Source: EY Analysis based on JMK Research38

Accelerating India’s clean energy transition

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Utility Scale BESS Project Pipeline
Project name or scheme(Auction / Tender)

Date ofannouncement

Project
capacity(MW AC)

BESS capacity(contracted) Project Location(MWh AC)GSECL 35 MW with 57 MWh BESS
Solar(EPC) Gujarat

Sep-2021

35

57 GUJARATNIT for procurement of 2,000 MWh
battery energy storage system

Jul-2021

1,000

2000 PAN INDIA

NTPC 4 MW Solar (EPC) + 1 MW/1
MWh BESS Uttar Pradesh

Jun-2021

4

1 UTTAR PRADESHREMCL Solar with 7 MW/ 14 MWh
BESS Maharashtra (Railway Land)

May-2021

7

14 MAHARASHTRASECI 100 MW Solar with 50MW/120
MWh BESS Storage Chhattisgarh

Dec-2021

100

120 CHHATTISGARHSECI 20 MW Solar with 20 MW/ 50
MWh BESS Storage Leh

Dec-2020

20

50 LADAKHSECI, 1,200 MW, ISTS -Tranche VII,
RE with storage

Aug-2019

900-

PAN INDIA

SECI, 1,200 MW, ISTS -Tranche VII,
RE with storage

Aug-2019

300-

PAN INDIANTPC 500 MW MW with 3000 MWh
ESS Pan India

Jan-22500

3000 PAN INDIASECI 500 MW with 1000 MWh BESS
RajasthanApr-22500

1000 RAJASTHANNTPC 10 MW/40 MWh BESS (EPC)
TelanganaApr-22

1040 TELANGANANTPC 250 MW with 500 MWh BESS
RajasthanApr-22250

500 RAJASTHAN

5230 MW Renewable Energy Storage
Project in AP

Oct-225,230-

ANDHRA PRADESH

Source: EY Analysis based on JMK Research

39

Accelerating India’s clean energy transition

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Project location for utility scale RE power generation capacity in pipeline
Rajasthan, Gujarat, Maharashtra, Uttar Pradesh andMadhya Pradesh are the top five states emerging
for siting utility scale RE power generation projects
in the pipeline (refer graphic with serial number forcorresponding state).

12

PAN India projects whose locations are yet not finalized
Solar: 31, 474 MW; Wind: 10,044 MW; Storage: 5,000 MWh

17

8
7
21

18

2
3

6

9

13

15
22

4

16
14
20
5
10

19
11

Source: EY Analysis based on JMK Research40

Accelerating India’s clean energy transition

1

Solar
capacity(MW)

S. States/
No UTsAndaman &1
Nicobar islands

4

2 Assam25

3 Bihar230

4 Chhattisgarh

Wind
capacity(MW)

Storage
capacity
(MWh)

1,278

5 Goa

120

PPA executed capacity in pipeline (MW)RE Technology

Total (MW)

Floating solar

240

Hybrid (Solar +wind)

6,255

Open access

1,198

Solar PV

24,981

Wind

8,348

Grand Total

41,02270

6 Gujarat

6,750

7 Haryana120

8 Himachal Pradesh

15

9 Jharkhand

130

10 Karnataka

2,230

11 Kerala320

12 Ladakh

20

4,401

57

480

50

13 Madhya Pradesh

3,005

638

14 Maharashtra

5,837

1,595

14

1500

15 Nagaland20

16 Odisha150

17 Punjab

1,150

18 Rajasthan

19,6181,580

19 Tamil Nadu

1,150

352

20 Telangana

285

40

21 Uttar Pradesh

2,737

1

22 West Bengal

105

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8

Investment mobilization

Employment potential

Utility scale RE projects in pipeline would need INR ~3.73 lakh crore (US$ ~48 billion, 1
INR = 0.013 US$) of capital infusion for operationalization. This translates into INR1.12
lakh crores (US$ ~14.1 billion) of equity infusion and INR2.61 lakh crores (US$ ~33.6
billion) of debt infusion at 30:70 ratio. Much of this capital infusion is expected from theprivate sector increasingly backed by private equity investors, sovereign wealth funds
and other specialised institutional investors.
Capital Investment – Equity

Capital Investment – Debt

~INR 1,11,902 crores~INR 2,61,105 crores

For 103 GW of Utility scale
RE projects in pipeline

For 103 GW of Utility scale
RE projects in pipeline

Estimated
CAPEX outlay

Viability gap
funding

Fresh jobs created~ 7,92,747 jobs
For 103 GW of Utility scale RE projects in pipeline

Capital infusion for utility scale RE projects in pipeline (INR crores)
RE technology~7.93 lakh fresh jobs will be created for operationalizing the 103 GW pipeline of utility
scale RE projects. 52% of total jobs would be local job pertaining to project planning,
O&M and commercial, whereas 48% would be supply chain jobs catering manufacturing,transportation and decommissioning.

Fresh jobs created from utility scale RE projects in pipeline

EquityMobilisation

Debt
financing

Biomass

1,098

329

769

Floating solar

5,877

1,763

Hybrid (Solar +wind)

39,546

Open accessRE + Storage

Biomass

2,623

4,114

Floating solar

15,217

11,864

27,682Hybrid (Solar +wind)

65,262

29,166

8,750

20,416

Open access

74,033

5,144

1,543

3,601

RE + Storage

12,381

63,334

1,47,779

Solar PV

2,13,357

Storage

9,810

2,943

6,867

Wind

Wind

71,254

21,37649,877

Grand Total

1,11,902

2,61,105

Grand Total

Total no. of
Fresh Jobs

RE technology

3,75,251

2,244

2,244

Solar PV

5,52,492

70,739
7,92,747

Source: EY Analysis based on JMK Research

41

Accelerating India’s clean energy transition

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Environmental benefits~4 billion tonnes of cumulative CO2 e emissions can be
avoided over a lifetime of 103 GW capacity of gridconnected utility scale RE projects.

Avoided CO2 emissions (cumulative over project lifetime)~3,989 million tonnes CO2e
For 103 GW of Utility scale RE projects in pipeline
1.7%

1.4%

10.4%

8.2%

17.7%

60.5%

0.2%
0%

10%

20%
Biomass30%
Floating solar

40%

50%

Hybrid (Solar +wind)

60%
Open access70%
RE + Storage

80%
Solar PV

90%

Wind

Source: EY Analysis based on JMK Research

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Accelerating India’s clean energy transition

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100%

However, there is lack of uniform approach for states with abundant wasteland
resources to allocate such land among RE developers by way of a transparent
competitive mechanism. MNRE scheme for development of ultra mega RE powerparks could embed such mechanisms for development and implementation ofprojects. There is a need to formulate and implement uniform land acquisition
policy with provision of single window clearance mechanism for projects
awarded through auctions conducted by central PSUs as intermediary offtakers. Simultaneously, the model policy could also specify the framework for
aggregation of large privately owned wasteland parcels with right incentives forlandowners to lease their assets for development of ultra mega RE power parks.

Recommendations

1. Establish a national index along with regional sub-indices for
RE pricing by pooling of prices / tariffs discovered from RE
auctions

43

Many utility scale RE projects in the pipeline remain stranded without PPAs
even after completing price discovery through auctions and this scenario islikely to persist. This is largely because the DISCOMs, who are the ultimate
buyers of renewable electricity from these projects, expect the tariffs to fall
perpetually as a function of time and therefore delay signing power supply
agreements hoping to find better deals from future auctions. One way toaddress this challenge is that the central PSUs, which plan and conduct
renewable energy auctions as intermediary off-takers can take in principle
approval from the DISCOMs, agreeing on acceptable range for tariff discovery.
The same agreement can be captured in the Tariff filing applications submitted
to respective state regulatory commissions. This would enable the timely
execution of Power Sale Agreements.

3. Dynamic pricing in wholesale markets and expanded scope of
TOD retail tariff necessary for creating commercially attractive
use cases for deployment of utility scale BESS
Today the bulk of wholesale electricity markets in India are governed by longterm purchase agreements with DISCOMs. These agreements do notdifferentiate the value of electricity supplied on the basis of time of day and / Orseason. Part of the problem is that the retail prices (end–user tariffs) are fixedround the clock for most categories of consumers. Time of day tariffs aremandated selectively for high tension category industries only with options forvoluntary adoption in few other categories in select states. Lack of smart
metering infrastructure is another key bottleneck in this regard to enable timeof day pricing. Advanced Metering Infrastructure (AMI) of smart meters increase
opportunities for implementing TOD tariff, enabling multiple pricing options to
be offered to customer.

Also, in this context, pooling of prices/tariffs discovered from multiple
auctions conducted over a pre–defined period could help both buyers andsellers with a single benchmark cost for negotiating PPAs and PSAs. SECI andother central PSUs acting as intermediary off–takers can collaborate toformulate a national index with regional sub-indices based on pooling ofprices/tariffs discovered from multiple RE auctions. Such an index will help
periodically benchmark the competitive price / tariff for RE based power
generation and guide negotiations for PPA signing between parties. Such anindex will also help investors and financial institutions inform their outlook andevaluation of utility scale RE projects.

The central government has notified the timelines for replacement of existing
meters with smart meters with prepayment features. By 2023, a significant
number of urbanized states and UTs with high AT&C losses (>15%) is expected
to replace, whereas remaining states may take until March 2025 for the same.
With rising share of low cost intermittent renewable energy sources supplying
abundant electricity during day time and monsoon months, dynamic pricing isessential for rewarding discharge of surplus/excess renewable electricity fromBESS at times the grid needs most – evenings, early mornings etc. More
importantly, dynamic and time variant pricing mechanisms are essential forenhancing the arbitrage value of electricity storage. Dynamic time variant tariffs
are key to maximize the profitability of BESS projects and investments.

2. Formulate a model policy for aggregation and allocation ofwasteland parcels for the development of ultra mega utility
scale RE power parks
Access to contiguous land parcels is still a challenge for the development ofMegawatt scale RE projects in several states. Wasteland categories like landwith dense scrub, land with open scrub, shifting cultivation, degradedpastures/grazing land, degraded land under plantation crop may be good fit
for development of RE projects.

Accelerating India’s clean energy transition

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4. Implementation of the Electricity Amendment Bill 2021

6. Retrofitting / repowering existing solar and wind power
installations

The draft ‘Electricity Amendment Bill 2021’ is welcomed by the industry in
its present form and can be a game changer in transforming the power
sector to become more investor friendly by improving ease of doing
business, enforcement of contracts, cost reflective tariffs, direct benefit
transfer of subsidies, national renewable energy policy, strengthening ofinstitutions such as APTEL and electricity regulatory commissions,
expansion of NLDC functions etc.

In order to ramp up solar and wind energy generation at existing sites
which provide the option of replacing vintage generating plants withequipment deploying advanced technology and resulting in higher CUF,
following measures are relevant:a. Examine the scope for retrofitting end-of-life solar power plants withnew technology options to improve efficiency, by application of:

Recommendations

The implementation of ‘Electricity Amendment Bill 2021’ will likely boost
the investor confidence for driving energy transition investments andgalvanise the full spectrum of stakeholders in the power sector for a better
future.

44

5. Scale up skilling and training efforts to boost availability ofskilled professionals for project execution

dual Axis Active Solar Trackers for increasing generation►

silicon based Passivated Emitter and Rear Cell (PERC) panels having highpurity to improve cell efficiency►

bifacial solar cells to increase generation►

half cells panels to improve overall module durability

b. Identify wind power projects / capacities to be augmented by repoweringand initiate following activities:

Over the years, the government of India through ‘Skill Council for Green
Jobs’ has scaled up skilling and training activities for the youth of India tosupport the industry’s ambition and investments towards energy transition.
Occupational mapping, skill gap analysis, development of qualification
packs for various job roles expected from energy transition investments,
curriculum and courseware development, strengthening the quality of
training infrastructure, certification of candidates, improving linkages withindustry for job placements are all streamlined for better outcomes.

►

selecting sites that would maximize harnessing of wind resources►choosing appropriate designs to improve the power output, viz. rotor
height and diameter, turbine capacity etc.

►

assessing site constraints / ROW and enablers for refurbishingc. Repositioning the solar and wind installations with higher capacity andoutput efficiency would entail addressing commercial arrangement, viz.:

Given the scale of energy transition investment pipeline and resulting
employment potential, the above activities will need to be ramped up
involving the academia, industry, civil society organisations and otherpartners. A comprehensive monitoring and evaluation framework focusing
on meeting the industry needs, improving livelihoods and other positivesocio-economic outcomes should be adopted for the skilling and training
activities and programs.

Accelerating India’s clean energy transition

►

1

►

framework for bidding / rebidding►

termination clause / recompensing provisions for incumbent developers►

off-take arrangement with buyers

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3

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7

8

7. Policy Coordination and Implementation

8. Project Monitoring

Integrative approach between MOP and MNRE will be necessary at apex levelfor synchronizing technology selection, resource allocation and capacity
addition plans. In particular, following tasks are important:

To reinforce inter-ministerial coordination, an Apex Body under aegis of MOP and
MNRE can be formed to monitor project implementation and develop work plans
for addressing:►ensuring cross-sector linkages and policy coordination►build-up of domestic manufacturing►

enshrining the six pillars of PM Gati Shakti and removing the silos for
portfolio expansion – comprehensiveness, prioritisation, optimization,synchronization, critical analysis, and dynamic review►

design of fiscal incentives and their applicability►

technology upgrades and collaborations

driving synergies of objectives and tasks across GOI initiatives, viz. National
Energy Solar Mission, National Hydrogen Mission, National Energy Storage
Mission, etc.

►

raw material sourcing and supply chain issues►

streamlined project clearances and approvals►

policy support for project finance, planning and implementation

Recommendations

►

45

►

aligning incentive schemes for providing impetus under domestic
manufacturing and supporting R&D to facilitate technology adaptation /collaboration / partnerships►

addressing supply chain constraints and removing the bottlenecks,
encompassing technology upgrade, raw material sourcing, import options
and strategic investments, e.g. positioning technology for solar cells,
electrolysers, etc., and minerals including rare earth metals for advanced
chemistry battery cells►

channelizing project finance by introducing appropriate schemes undercredit enhancement mechanism, partial risk guarantees, first loss
guarantees, etc. and leveraging public / blended finance for attracting
private capital.

Accelerating India’s clean energy transition

Joint Working Groups (JWGs) under MOP and MNRE are proposed to enableknowledge exchange, support work plans basis identified projects and facilitate acoordinated approach across the full spectrum of technology deployment,
project development and capacity expansion.
A dedicated Project Monitoring Panel is suggested for reviewing progress ofprojects under implementation, including but not limited to those under thermal,hydro including pumped storage, renewables and BESS categories. It will act as
the effective interface between the Working Groups, the Apex Body and theadministrative Ministries for addressing project-specific bottlenecks and fasttracking execution, as will be necessary.

1

2

3

4

5

6

7

8

Decentralization of
power system throughdistributed generation5
46

Accelerating India’s clean energy transition

Shovel-ready pipeline of grid connected rooftop PV (RTPV)
projects in residential, commercial and institutional sectors
Introduction

Pipeline Capacity (MW)RTPV markets in India witnessed the highest ever capacity addition (~2654 MW) in the last calendar year 2021.The statesof Gujarat, Maharashtra and Kerala are leading the RTPV capacity addition growth in the country. The Ministry of New andRenewable Energy (MNRE) has launched Grid Connected Solar Rooftop Program – Phase 2 in August 2019. The
Component–A of this program aims to deploy 4 GW of RTPV systems in the Residential Sector with Central Financial
Assistance (CFA) up to 40%. Approximately ~3.2 GW RTPV capacity is already allocated by MNRE for implementation invarious states. Whereas the Component–B aims to incentivize state DISCOMs for performance that is evaluated byincremental RTPV capacity addition (up to 18 GW) in any sector.

Bihar

23

Chandigarh

32

NCT of Delhi

34

Karnataka

40

Haryana

30

Madhya Pradesh

46

West bengal

60

Telangana58

Punjab66

Uttar pradesh

75

Rajasthan66

Shovel ready projects for implementation~2.0 GW of RTPV capacity in residential and ~144 MW in C&I segments is currently under pipeline. Approximately, 1.2 GW
of RTPV has been commissioned under the MNRE scheme as of January 2022. CAPEX model of development is currently
dominating the project pipeline under both components. Whereas, Renewable Energy Service Company (RESCO) model ofdevelopment leveraging private sector investments is increasingly tested for faster adoption. A variety of other innovative
business models such as rent a roof/lease model, community model, utility model through a Special Purpose Vehicle (SPV),
plug–in Rooftop Solar (RTS) model and others are also being explored. Currently Gujarat is leading in pipeline capacity forrooftop projects with 947 MW followed by Kerala and Maharashtra with 249 and 132 MW respectively.

Simplified procedure for RTPV installations under MNRE scheme, Jan 2022
A national portal for registering applications from the beneficiaries, approvals thereof and tracking progress will be
developed. Further, the beneficiary can install RTPV systems from any vendor fulfilling the conditions of DCR, enlistment
under ALMM and inverters certified by BIS. Model standards and agreements for supply with vendors will be notified. This
will significantly improve ease of doing RTPV across the country.

Maharashtra
KeralaElectricity (Right of Consumers) Amendment Rules 2021

Accelerating India’s clean energy transition

1

2

3

249

Gujarat

These rules allowed up to 500 kW Or sanctioned load whichever is lower for RTPV installations availing net metering by any
Prosumer. This is a significant policy driver for accelerating RTPV project pipelines across the country when properly
enforced by state electricity regulatory commissions.

47

132

947
0

4

5

6

200

400

7

8

600

800

1000

For the allocatedcapacity of 2.0 GW
under development,~INR 3,042 crores (US$~0.4 billion) of capital
investment will bemobilized (excluding thesubsidy). Further,another INR 1,259
crores (US$ ~0.2 billion)
is expected to be
mobilized for building
the remaining capacity
announced under the
MNRE program. The
Government of India
through MNRE could
provide total capitalsubsidies of ~INR 6,600
crores (US$ ~0.9 billion)
under component A.

48

Investment mobilization for allocatedcapacity (INR crores) – Component A
6000
5000

3346

Socio economic benefits

Shovel-ready pipeline of gridconnected rooftop PV (RTPV)
projects in residential, commercial
and institutional sectors

Investment
mobilization

Over 18,000 fresh jobs will be created in building
2.0 GW capacity of grid connected RTPV systems
under the program. These jobs will emerge in bothpublic and private sectors along the value chain of
project development, construction andcommissioning, operations and maintenance ofrooftop solar PV systems all across the country.

4000
Fresh jobs created

3000~18 thousand jobs

2000

For 2.0 GW of current allocation
under Phase II component A

2129

1000

Environmental benefits

913
0
Equity Mobilisation

Debt Financiny

Capital Subsidy

Source: EY analysis based on MNRE SPIN portal

Capital Investment – Equity

Capital Investment – Debt

~INR 913 crores~INR 2,129 crores

For 2.0 GW of current allocation
under Phase II component A

For 2.0 GW of current allocation
under Phase II component A

Accelerating India’s clean energy transition

Over ~80 million tonnes of CO2e emissions are
expected to be avoided over the operating lifetimeof 2.0 GW capacity of grid connected RTPV projects
commissioned under the program.
Avoided emissions(cumulative over project lifetime)~80 million tonnes CO2e
For 2.0 GW of current allocation
under Phase II component A

1

2

3

4

5

6

7

8

2. Frame policy and regulatory incentives topromote utility owned / driven businessmodels for RTPV capacity addition

1. Adopt best practices from Gujarat and Kerala models of scaling up
RTPV implementation in residential sector

Recommendations

We examined the ratio of commissioned RTPV capacity to allocated capacity by MNRE in order tobenchmark the progress in each state. Before current allocations by MNRE, Gujarat had achieved
83% of its allocated capacity of ~1.2 GW. States such as Rajasthan, Haryana and Telangana
achieved between 40%–50%, whereas other moderately performing states namely Uttarakhand,
MP and UP achieved 20–30% of allocation.

49

Under the Grid connected Rooftop Solar Program –phase 2 component A, most of the DISCOMs have largely
adopted the consumer owned model with utility acting asan aggregator to implement the sanctioned RTPV
capacity. Going forward, DISCOMs must look beyond
consumer owned models to attract more households,
especially in the lower slabs of consumption (less than
100 units per month).

In our opinion, Gujarat has shown tremendous progress because of following interventions:► Additional subsidy sponsored from state up to 10kW projects► A unified web portal for processing consumer RTPV applications, single window approvals
and tracking► No capping of the RTPV capacity with respect to sanctioned load
► Reduction of security deposit payable by developer to the DISCOM from 25 Lakhs to 5 Lakhs► Banking charges, cross subsidy and additional surcharge exempted for residential prosumers► Consumer awareness and outreach programs

Allocated and commissioned
capacity (MW)Commissioned out of allocatedcapacity till December 2021
Uttar pradesh

23%

3500

Madhya Pradesh

26%

3000

Uttarakhand

37%

Telangana

41%

Kerala State Electricity Board (KSEB) has successfully
aggregated over 200 MW of RTPV demand fromhouseholds in the lower slabs of consumption by offering
compensation for access to roof space in the form ofmonthly energy credit. DISCOMs in other states musttake a cue from this success and act fast to unlock value
in the RTPV market. Perceived threats from revenue loss
can be turned into a growth opportunity if DISCOMs
channel their CAPEX into supplying RTPV electricity toindividual households.

2500

Changes in regulatory paradigm will be necessary to
incentivize DISCOMs to partake in decentralized
generation activity and provide the platform for system
integration by investing in grid-edge technologies
requiring advanced computational power andoptimization modelling software. An earning adjustment
mechanism linking revenue to efficiency targets is ameasure implemented in other jurisdictions thatcompensates DISCOMs against flat-to-declining load
growth and provides for recovery of programme
expenses and lost distribution revenue as well as a shareof the net economic benefits and / or a rate of return on
capex in non-wire solutions.

1222

2000
1500

Haryana47%

1000

Rajasthan

49%

500

GujaratSource: EY analysis

Accelerating India’s clean energy transition

83%

141

1939

992

0
Allocated
Gujarat allocation

Commission
Rest states combined

1

2

3

4

5

6

7

8

3. Demand aggregation for RTPV deployment in the institutional
sectors (e.g. health, education and all government buildings)
integrated with storage

Recommendations
50

Rural health centers and schools are largely vulnerable to irregular power
supply and frequent interruptions adversely impacting the delivery of essential
healthcare and education in rural communities. Despite having diesel
generators for power backup, their operations are restricted due toinadequacy of funds for diesel. Sometimes in remote locations, the supply of
diesel is interrupted during monsoons or bad weather. As per the World HealthOrganization (WHO), unreliable electricity access leads to vaccine spoilage,interruptions in the use of essential medical and diagnostic devices, and lackof even the most basic lighting and communications for maternal delivery andemergency procedures. The quality of energy access in healthcare andeducation facilities may have crosscutting impacts, for example, retention ofhealth workers, improved enrolment / attendance of students and teachers ingovernment schools who often live right alongside these facilities.

Stimulus benefits –(Cumulative over Solar PV system operating lifetime)

Experience from Chhattisgarh, Odisha (Kalahandi) and Karnataka (Karuna
trust) have shown that health centers with rooftop solar systems provide 24–hour healthcare services treating a greater number of patients. Regular accessto electricity has also enabled them to have reliable supply of water, safe
refrigeration for vaccines, and powered theatre equipment, fans, and baby
warmers.

Direct savings inelectricity costs ofhealth centres

Direct savings in electricity
costs of rural government
elementary schools

INR 5,875
croresINR 21,284
crores(US$ ~0.8 billion)(US$ ~3 billion)

86 million
tons of CO2e61,800fresh jobs

INR 11,200 crores

Source: EY analysis

1

2

3

4

5

Fresh jobs
created in ruralcommunities

Total capital investment
towards rooftop Solar PV systems inhealth centres and rural
government elementary schools

Avoided CO2 emissions

There are ~1.5 lakh health centers (viz. sub–centers, primary health centersand community health centers) across the country with potential for ~564 MWof rooftop solar deployment. Similarly, there are approx. 6,82,000 rural
primary schools managed by government with potential for ~2 GW of rooftop
solar deployment.

Accelerating India’s clean energy transition

Dedicated capacity allocation for rooftop solar deployment inrural schools (2 GW) and health centers (500 MW) withgeneration based incentives► Extend low cost credit line for financing rooftop solar projects in
the institutional sectors► Set up institutional mechanism at central and state levels fordemand aggregation and investment related actions under OPEX
mode in both health and education sectors►

Stimulus options

As per the Parliamentary Standing Committee’s latest assessment, only
56.45% schools have adequate electricity access. Rural Health Statistics(2019) indicates that 26.3% of the rural sub–centers and 4.8% of rural Primary
Health Centers (PHCs) do not have access to electricity supply, which is not
only imperative for the functioning of healthcare facilities but also a vital
determinant of essential healthcare services delivery.

6

7

8

4. Design and implement credit risk guarantee mechanisms to support RTPV financing for MSMEs
Many financial institutions lending for MSMEs perceive huge risks related to payment delays and defaults while evaluating RTPV loans and its benefits manifestinglargely as operational cost savings / energy cost savings. To help mitigate these risks, credit risk mitigation measures can be explored which will provide therequisite cushion to financial institutions.
A credit guarantee (CG) mechanism provides guarantees on loans to borrowers by covering a share of the default risk of the loan. In case of default by theborrower, the lender recovers the value of the guarantee from the guarantor.

Recommendations

A fixed CG cover to the participating financial institutions is envisaged. Under this, the evaluation of both the borrowers and final power off-takers will be theresponsibility of the financial institutions. The CG cover gets activated and disbursement takes place once the loan gets classified as loss asset by the lender. A fixed
cover of up to 50% of the loan amount under the CAPEX and RESCO mode can be considered depending on the risk profile of the borrower on a case to case basis.

51

Accelerating India’s clean energy transition

Source: EY analysis

1

2

3

4

5

6

7

8

Shovel-ready pipeline of decentralized grid connected
renewable energy systems under PM–KUSUM component – A
Introduction
The simplified guidelines for implementation of PM–KUSUM (Pradhan
Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan) Scheme,
notified in Dec’21, allows states 24 months for implementation of
sanctioned capacity. The Component–A supports setting up of 10 GW
of decentralized ground mounted grid connected renewable energy
power plants for providing additional source of income for land owning
farmers. The grid connected renewable energy plant size is capped toa capacity up to 2 MW. MNRE will provide procurement based
incentive (PBI) to the DISCOMs @ 40 paise/kWh or Rs.6.60
lakhs/MW/year for first five years, whichever is lower, for buying
renewable power under this scheme. The PBI will be given to the
DISCOMs for a period of five years from the commercial operation
date of the plant.

Investment mobilisation for
sanctioned capacity (INR crores)– Component A

State wise pipeline
capacity (MW)18000

KERALA

40

16000

JHARKHAND

50

14000

UTTAR PRADESH106

PUNJAB

220

12000
11733
10000

Shovel-ready projects for implementation~4.8 GW capacity of decentralized ground mounted grid connected
renewable energy power projects are currently sanctioned by MNRE tovarious state nodal agencies (mostly DISCOMs) for implementation
under component A. A majority of these projects are still underdevelopment with nodal agencies inviting landowners/farmers, Solar
EPC companies and developers to gauge their interest in project
financing and development. Both CAPEX and OPEX models are allowed
for maximum participation from stakeholders. Landowners are allowed
to develop ground mounted grid connected Solar PV power projects
on agriculture farmlands for dual use of power generation andfarming. DISCOMs will identify substations for grid interconnection,
allocate capacity from auctions, and enter into power purchaseagreements with qualified landowners for aggregated demand.

52

Accelerating India’s clean energy transition

TAMIL NADU

500

ORISSA

500

MADHYA PRADESH

595

8000
6000
4000

RAJASTHAN

725

5028

2000

MAHARASHTRA

1931

0
Equity Mobilisation

Debt financing

Source: EY analysis based on JMK Research

1

2

3

4

5

6

7

8

Currently, the state nodal agencies are testing andstreamlining the process for solicitation of market
participants, capacity allocation, PPA execution,
construction and commissioning, monitoring andevaluation before rapidly scaling up capacity
addition. For the sanctioned capacity already underdevelopment, a total of INR 16,762 crores (US$
~2.25 billion) of capital investment will be mobilised
from the landowners and other project developers.
Private sector funds will be largely utilised to meetthis massive capital expenditure.
Capital Investment – Equity~INR 5,028 crores

Socio economic benefits~43,400 fresh jobs will be created in building 4.8
GW capacity of decentralized ground mounted gridconnected renewable power projects announced
under KUSUM component A. These jobs will emerge
in rural areas with private sector investments along
the value chain of project development,
construction and commissioning, operations andmaintenance of solar PV systems all across thecountry.

Shovel-readypipeline of decentralized
grid connected renewableenergy systems under
PM–KUSUM component – A

Investment mobilization

Fresh jobs created~43,400 jobs
For 4.8 GW of ground mounted solar PV
projects announced under KUSUM–A

For 4.8 GW of ground mounted solar PV
projects announced under KUSUM–A

Environmental benefits
Capital Investment – Debt

~INR 11,733 crores
For 4.8 GW of ground mounted solar PV
projects announced under KUSUM–A

Over ~190 million tonnes of CO2e emissions are
expected to be avoided over the operating
lifetime of 4.8 GW capacity of grid connected
ground mounted solar PV projects commissioned
under the program.
Avoided emissions(cumulative over project lifetime)~190 million tonnes CO2e
For 4.8 GW of ground mounted solar PV
projects announced under KUSUM–A

53

Accelerating India’s clean energy transition

1

2

3

4

5

6

7

8

Shovel-ready pipeline of standalone solar powered
agriculture pumps under PM–KUSUM component – B
Introduction
The simplified guidelines for implementation of PM–KUSUM (Pradhan
Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan) Scheme,
notified in December 2021, allows states conduct competitive pricediscovery of standalone Solar Powered Agriculture Pumps on theirown. Under Component B, 17.5 lakhs standalone solar irrigation
pumps are targeted for installation with CFA of 30% of the benchmark
cost or the tender cost, whichever is lower. The State Government will
give additional subsidy of min. 30% and the remaining will be financed
by participating farmers / beneficiaries.

Investment mobilization for
sanctioned capacity (INR crores)– Component B

Kerela

0

Delhi

0

Manipur

20

Mizoram200

Himachal Pradesh

550

8000

7000

6000

Shovel-ready projects for implementation~2.0 GW capacity from 3,56,453 stand alone solar pumps are
currently sanctioned by MNRE for implementation under component
B. Maharashtra, Madhya Pradesh, Rajasthan and Chhattisgarh are theleading states with sanctioned pumps more than 20,000 and above.

Number of pumps
sanctioned State wise

3529

5000

4000

Tripura1300

Meghalaya

1700

Odisha2500

Gujarat4000

Punjab4500

Karnataka

6000

Uttar Pradesh

8000

Jharkhand

3000

10000

Haryana
2416

2000

15000

Tamil Nadu

17500

Chhattisgarh

1000

20000

Rajasthan

25000

Madhya Pradesh

25000

1035

Maharashtra

30000

0
EquityDebt

Subsidy

Source: EY analysis

54

Accelerating India’s clean energy transition

Source: MNRE

1

2

3

4

5

6

7

8

Socio economic benefits

For the sanctioned capacity already underdevelopment, a total of INR 3,451 crores (US$~0.47 billion) of capital investment will be mobilisedin 2021–22 from the participating farmers.

~18,000 fresh jobs will be created for deploymentof ~3.5 Lakh stand alone pumps under KUSUM
component B. These jobs will largely emerge in therural areas along the value chain of construction
and commissioning, operations and maintenance of
solar pump systems.

Capital Investment – Equity

Fresh jobs created~INR 1,035 crores~18,000 jobs

For 3.5 Lakhs standalone solar pumps projects
announced under KUSUM–B

For 3.5 Lakhs standalone solar pumps projects
announced under KUSUM–B

Capital Investment – Debt

~INR 2,416 crores
For 3.5 Lakhs standalone solar pumps projects
announced under KUSUM–B

Shovel-ready pipeline ofstandalone solar powered
agriculture pumps under
PM–KUSUM component – B

Investment mobilization

Environmental benefits
Over ~16 million tonnes of CO2e emissions are
expected to be avoided over the operating
lifetime of 3.5 Lakh stand alone solar PV projects
commissioned under the program.
Avoided emissions(cumulative over project lifetime)~16 million tonnes CO2e

For 3.5 Lakhs standalone solar pumps projects
announced under KUSUM–B

55

Accelerating India’s clean energy transition

1

2

3

4

5

6

7

8

Shovel-ready pipeline of decentralized grid connectedsolar PV systems under PM–KUSUM Component – C
Introduction
The Component C targets solarization of 10 lakh grid connected
pumps. Up to 50% can be solarized at feeder level under thiscomponent. MNRE will provide CFA of 30% of the benchmark cost forsolarization of grid connected pump sets. The State Government will
give additional subsidy of min. 30% and the remaining will be financed
by beneficiaries. The feeder solarization capacity can be twice as muchas the connected load on dedicated agricultural feeders.

Investment mobilization for
sanctioned capacity (INR crores)– Component C

Number of pumps
sanctioned State wise0

Mizoram0

Kerela0

Karnataka

0

Himachal Pradesh

0

Delhi

0

Chhattisgarh

0Meghalaya

60

Manipur80

Haryana

468

Jharkhand

500

6000

Shovel-ready projects for implementation~1.9 GW capacity is currently sanctioned by MNRE to various state
nodal agencies (mostly DISCOMs) for implementation undercomponent C. A majority of these projects are still under developmentwith nodal agencies aggerating land, inviting developers / Solar EPC
companies to gauge their interest in project financing anddevelopment. Both CAPEX and OPEX models are allowed for maximum
participation from stakeholders. Under CAPEX mode, DISCOM will
make its own investment towards solar PV power plants by arranging
own funds, collaborate with empaneled EPC contractors / System
Integrators for setting up grid connected ground mounted solar PV
power plant on turnkey basis, operate and maintain the plant during
the PPA tenure. Under RESCO mode, DISCOM will purchase powerfrom a third–party developer selected after competitive tariff
discovery through reverse bidding/auctions.

Odisha

7000

5000
3961
4000

3000

2000

1300
3900
9000

Rajasthan

1000

12500

Madhya Pradesh

15000

Gujarat18500

Tamil Nadu

0
Debt Financing

Capital Subsidy

Source: EY analysis based on JMK Research

Accelerating India’s clean energy transition

TripuraMaharashtra

792

56

1000

Punjab
1849

Equity Moblisation

Uttar Pradesh

1

2

20000
0

5000 10000150002000025000

Source: MNRE

3

4

5

6

7

8

For the sanctioned capacity under development, a
total of INR 2,641 crores (US$ ~ 0.35 billion) of
capital investment will be mobilized.

Capital Investment – Equity~INR 792 crores
For 1.9 GW of ground mounted solar PV
projects announced under KUSUM–C

Socio economic benefits~17,100 fresh jobs will be created in building 1.9
GW capacity of decentralized grid connected solar
powered feeders under KUSUM component C. Thesejobs will emerge in rural areas with private sector
investments along the value chain of project
development, construction and commissioning,
operations and maintenance of solar PV systems.

Shovel-ready pipeline ofdecentralized grid connectedsolar PV systems under
PM–KUSUM Component – C

Investment mobilization

Fresh jobs created~17,100 jobs
Capital Investment – Debt

~INR 1,849 crores
For 1.9 GW of ground mounted solar PV
projects announced under KUSUM–C
Source: EY analysis

For 1.9 GW of ground mounted solar PV
projects announced under KUSUM–C

Environmental benefits
Over ~75 million tonnes of CO2e emissions are
expected to be avoided over the operating lifetimeof 1.9 GW capacity of grid connected solar PV
projects commissioned under the program.
Avoided emissions(cumulative over project lifetime)~75 million tonnes CO2e
For 1.9 GW of ground mounted solar PV
projects announced under KUSUM–C

57

Accelerating India’s clean energy transition

1

2

3

4

5

6

7

8

1. Generation-based incentives for decentralized grid connected ground mounted solar PV systems co–located with crops on agriculturally
productive land parcels (hereinafter referred as agro–PV projects)

Stimulus measures foraccelerated economic recovery

PM–KUSUM component A is designed to provide alternate /additional source of income and livelihood from decentralized
renewable power generation for:i.
Farmers of cultivable landii. Farmers or landowners of wasteland / barren / uncultivable land

58

The first category of farmers would have to design and develop solar
PV systems for co–location with crops on agriculturally productive
land parcels. This will require elevated structures and a moredispersed solar PV array arrangement to permit sufficient sunlightfor crop cultivation, thereby increasing the capital cost. A variety ofinnovative agro–PV solutions are emerging from successful
demonstrations in Germany, Japan, South Korea, China, France, theUnited States and India. The Indian Council of Agricultural Research– Central Arid Zone Research Institute (ICAR–CAZRI) has successfullycommissioned Solar PV systems co–located with a variety of crops in
Jodhpur.
As per a recent IRENA report (2019), agro–PV systems combine
solar PV and agriculture on the same land and consists of growing
crops beneath ground mounted solar panels. Although the concept
was in existence for long, it has received little attention until
recently, when several researchers have confirmed the benefits ofgrowing crops beneath the shade provided by the solar panels. These
include higher electricity production, higher crop yields and lesswater used. Many types of food crops, such as tomatoes, grow betterin the shade of solar panels, as they are spared from the direct sun
and experience less water loss via transpiration, which also reduces
water use while maintaining the same level of food production. A key
advantage for solar panels is that their efficiency is increased.
Cultivating crops underneath reduces the temperature of the panels,
as they are cooled down by the fact that the crops below are
emitting water through their natural process of transpiration.

Accelerating India’s clean energy transition

Separate Land Use on 1 Hectare land:
100% Farmland or 100% Solar Electricity

The land use impact from solar
energy expansion is likely to havecross cutting implications on thefood security and land productivityof the country. In this regard, it isworthwhile to examine thealternative use cases of landacquired for solar energy
generation and device policy
pathways to reduce the land use
impact. KUSUM scheme Component
A can be a perfect test bed to scale
up adoption of agro–PV solutions.

100% farmland

OR

Ideally, DISCOMs have to conduct
the competitive auction process in
two separate tranches of capacity
allocation for projects proposed on
barren and agriculturally productive
land parcels. This will ensure levelplaying field for all the participants.
DISCOMs may also shy away fromhigher cost of power procurementfrom co–located agro–PV systems
developed on agriculturally
productive land. In this scenario,
generation based incentives forpromoting co–located agro–PV
systems will reduce the burden on
DISCOMs and at the same time
make these investments
economically attractive.

1

2

3

4

100% solar
electricity

Combined Land Use on 1 Hectare land:
186% land use efficiency

Source: Fraunhofer Institutefor Solar Energy Systems ISE

5

6

7

8

Stimulus measures foraccelerated economic recovery

2. Dedicated financing facility for improving farmer access to low-cost debt funds and boosting commercial viability of 1—2 MW scale
ground mounted Solar PV projects on CAPEX mode (own investment from farmers)

59

A major impediment reported by the states for implementing PM–KUSUM
component is the inability of individual farmers/ group of farmers/ cooperative
societies/ panchayats/ FPO/ WUA to raise funds (approx. 2.45 crores per MW
in case of component A, 40% of project cost in case of components B and C)
for implementing the projects on their own. MNRE should conduct a detailed
review of currently available schemes of NABARD and commercial banks,
analyze adequacy of these schemes, and suggest any modifications necessary
to improve effectiveness of these financial products for financing KUSUM
scheme. Public sector banks such as ‘Bank of Baroda’, ‘Central Bank of India’,‘Union Bank of India’ have notified lending terms and conditions for financing
projects under KUSUM scheme. These banking products require 150% of
project value as collateral for loan security apart from primary security
obligations such as hypothecation of plant and machineries, mortgage of land,
third party guarantee, exclusive charge over PPA and escrow account throughtripartite agreement between DISCOM, Bank and farmer enterprise etc.
Farmers can also avail benefits of credit guarantee coverage under CGTMSE if
registered as MSME and having obtained Udyam Registration certificate.
These loans (for components B&C) can also be converged under Agriculture
Infrastructure Fund scheme for interest subvention as the projects are
considered as community farming assets. Payment risk of DISCOMs may affectthe volume of commercial financing that can be raised for this scheme.
Therefore MNRE in consultation with states can explore alternatives like saleof power to intermediary CPSUs (e.g., SECI, EESL) who can use open access tocontract with Farmer Enterprises for back to back sale with large public sector
energy intensive consumers at–least for the duration of loan. More
importantly, MNRE could also explore policy amendments to make component
A as attractive as component C for DISCOMs and farmers after consideringsubsidies.

Accelerating India’s clean energy transition

Establish a dedicated financing facility of ~INR 25,000 crore on the lines ofAgri Infrastructure Fund to enable farmers access low cost debt financing forsetting up 5 GW of decentralized renewable energy projects on CAPEX mode
under PM–KUSUM component A.

Direct annual savingsin access to electricity

Fresh jobs createdin rural communities

INR235 crores

61,800 jobs

Avoided CO2 emissions

Investment to boost
rural economic activity

86 million tons

INR9,000 crores

Source: EY analysis

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4

5

6

7

8

Advancing self–reliant
supply chains for sustainableenergy transition

6
60

Accelerating India’s clean energy transition

High efficiency solar PV cell and module manufacturing
Enlisting manufacturers and models of solar PV modules
As per the latest (April 2022) approved list of manufacturers and models of Solar PV Modules (ALMM), the current
enlisted capacity for manufacturing solar PV modules in India is ~13.2 GW. The installed capacity for manufacturing solar
PV cells is ~3 GW as per MNRE.

In order to boost demand for locally manufactured solar PV modules, the government schemes including central public
sector undertaking (CPSU) scheme, phase 2 of grid connected rooftop solar program and PM–KUSUM scheme mandate
domestic content requirement for sourcing solar PV modules. The government has also issued amendments to ALMM
order, 2019 clarifying that only the models and manufacturers enlisted under ALMM will be eligible for use in Government
Projects / Government assisted Projects / Projects under Government Schemes & Programmes / Open Access I Net
Metering Projects, installed in the country, including projects set up for sale of electricity to Government under the
Guidelines issued by Central Government under section 63 of Electricity Act, 2003 and amendment thereof.

Production linked incentives for domestic manufacturing
To enhance India’s solar PV manufacturing capabilities and exports, MNRE issued the Scheme Guidelines for ‘National
Programme on High Efficiency Solar PV Modules’ with an initial outlay of INR 4500 crores in April 2021. The scheme has
provisions for supporting integrated manufacturing units of high efficiency solar PV modules by providing Production
Linked Incentive (PLI) on sales of such solar PV modules. Budgetary outlay for the scheme was increased from INR 4500
crores to INR 24000 crores to accommodate more players and ramp up domestic manufacturing capacity. On average 4–
6% of the production value is provided as incentive to promote competitiveness among global markets. In Feb’22, IREDA
announced the updated list of successful bidders to set up 10 GW of vertically-integrated manufacturing capacities ofhigh-efficiency solar modules under the PLI program.
As per media reports, the draft guidelines for Tranche II envisages INR 12000 crores reserved for bidders setting up
vertically-integrated capacities of polysilicon, wafers, cells, and modules; INR 4500 crores for those setting up wafers,
cells, and modules capacity, and INR 3000 crores for cells and modules capacity. The implementation of the PLI program(Tranche-II) is now handed over to SECI. The applicant manufacturer will have to commit to a minimum level of integration
across solar cells and modules to qualify for the bid. Based upon the extent of integration proposed, the bidder can opt forbidding for any of the three baskets. The applicant will have to set up a minimum 1 GW manufacturing unit to qualify forthe bid. The maximum capacity to bid is 10 GW for polysilicon, wafer, cell, and module; 6 GW for wafer plus cell andmodule; and 6 GW for cell and module categories. However, the maximum capacity awarded to one bidder under the PLI
program would be 50% of the bid capacity.

61

Accelerating India’s clean energy transition

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Shovel-ready projects for implementation

Investment mobilization

Approximately 112.5 GW/year capacity for manufacturing solar PV cells and modules
are in the pipeline at various stages of development. These projects are spread across 8
states with Gujarat leading 14.7 GW/year capacity. However, location for ~78.1
GW/Year capacity under pipeline is not available. About 48.6 GW/Year capacity underpipeline is committed for PLI scheme. This indicates that there is substantial
manufacturing capacity under pipeline not expecting incentives under the PLI scheme.
As the global supply chain pivots away from China these projects would likely cater tothe export markets, thereby positioning India as a key exporter of solar PV cells andmodules.
Approximately 30.2% of total pipeline capacity is expected to have integrated cell andmodule facilities, 44.7% with only module manufacturing and 37.6% with only cellmanufacturing.
Location of PV
cell and module
manufacturing
facilities

Manufacturing
capacity underpipeline(GW/year)

Gujarat14.7

Tamil Nadu

7.0

Karnataka

3.1

Maharashtra

2.5

Rajasthan

2.5

Uttar Pradesh

1.8

Telangana

1.7

Andhra Pradesh

1.2

NA*

78.1

Grand Total

112.5

Value chain of pipeline capacity(GW/year)62

Capital Investment – Equity

Capital Investment – Debt

~INR 1.06 lakh crores~INR 2.49 lakh crores

For 112.5 GW/year capacity of solar
cell/module manufacturing

For 112.5 GW/year capacity of solar
cell/module manufacturing

Social benefits
The total pipeline of solar PV cell and module manufacturing facilities will create direct
employment for ~5 lakh professionals.

Fresh jobs created~5 lakhs

30.2, 27%

For 112.5 GW/year of capacity of solar cell/module manufacturing

44.7, 40%

37.6, 33%

ModuleSource: EY analysis based on JMK Research* Information not available

A total of INR 3.55 lakh crores (US$ ~ 45.8 billion) of capital investment will bemobilized to operationalize these projects in the pipeline.

Cell

Integrated (cell & module)

Source: EY analysis based on JMK Research

Accelerating India’s clean energy transition

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Advanced chemistry battery cell manufacturing
350

Short and long term demand outlook

In the energy sector, India announced a target of 500 GW of non–fossil
fuel energy deployment by 2030 as commitment to tackle climatechange at COP 26. Achieving high levels of intermittent renewableenergy penetration in the grid will naturally create a large market
opportunity for stationary storage. The CEA in its optimal generation
mix report for FY 2029–30 estimates ~136 GWh of energy storage
capacity in the grid to integrate high share of intermittent renewableenergy sources. Stationary energy storage systems (ESS) can provide
a variety of services to stakeholders at all levels of the electricity
system, including GT&D utilities and end–use customers. With thehistorical rate of cost decline in the lithium–ion battery industry, thegovernment and industry together is currently betting on thisadvanced chemistry battery technology for stationary energy storage
applications.

63

Accelerating India’s clean energy transition

15

16
14

250
12
200

10

48% EV
share

8

150
6

6
100

50

21% EV
share

Market Size ($ Billion)

In the transport sector, India is among a handful of countries that
support the global EV30@30 campaign, which targets to have at least
30% new vehicle sales electric by 2030. This presents India with apowerful opportunity to emerge as a global leader in new mobility
solutions and battery manufacturing, positioning for sustainableeconomic growth and global competitiveness. India is uniquely
positioned to deploy EVs at scale, leapfrogging traditional mobility
models that perpetuate air pollution and oil import dependence whiledriving down the costs of batteries through economies of scale.

18

300

Annual Demand (GWh/Year)The demand for advanced chemistry battery cells in India will be driven
largely by electric mobility transition in the short-medium term andstationary grid storage applications in the long term. As per NITI
Aayog, the annual market for stationary and mobile batteries in India
could surpass US$15 billion by 2030, with almost US$12 billion from
cells and US$3 billion from pack assembly and integration.

40% EV
share

4

2
2

0

0
2022

2026

Passenger Evs
E-buses
Behind-the meter (Res + Comm)
Market Size

2030

Commercial Evs
Freight
Consumer Electronics

E 2-wheeler/3-wheeler
Stationary Storage (Grid-scale)Rail + Defense

Source: NITI Aayog, 2022

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Understanding energy storage systems (ESS) in the context ofIndia’s energy transition
The Ministry of Power, Govt. of India recently issued a detailed clarification regarding
the usage of ESS in the power sector. The Ministry clarified that ESS can be advanced
chemistry battery systems, pumped hydro systems, thermal phase change systems,
green hydrogen and green ammonia-based storage systems. The Ministry also clarified
that ESS can be used for grid balancing services providing fast response ramp up anddown, peaking power support, enhancing flexibility in the power system operations,firming up of RE power generation at the source, energy shifting, enabling optimum
capacity utilization of T&D network and CAPEX deferral, arbitrage, peak shifting etc.
The government also clarified that standalone ESS as a service does not need any
license for operations.

ACC PLI scheme
The department of heavy industries notified the Production Linked Incentive (PLI)
scheme, ‘National Programme on Advanced Chemistry Cell (ACC) Battery Storage’ in2021 for implementation of giga–watthour scale ACC manufacturing facilities in India
with a budgetary outlay of INR 18100 crore. The scheme envisaged setting up of acumulative ACC manufacturing capacity of 50 GWh and an additional cumulative
capacity of 5 GWh for Niche ACC Technologies.
The beneficiary must ensure achieving a domestic value addition of min. 25% and incur
the mandatory investment (₹ 225 crore /GWh) within 2 Years (at the Mother Unit Level)
and raise it to 60% domestic value addition within 5 Years, either at Mother Unit, in–caseof an Integrated Unit, or at the Project Level, in–case of “Hub & Spoke” structure (the“Project”). To ensure a single–window mechanism for the potential investors, a state–level grand– challenge is being planned, including provision for encumbrance–free land,
trunk infrastructure facilities, power at rationale rate to the potential investors for
attracting the Projects.
A total of 10 bids with capacity ~130 GWh was received under the ACC PLI scheme. The
incentive structure is designed to encourage industry to promote fresh investments inindigenous supply chain and deep localization for ACC battery manufacturing in the
country. Finally, 4 bidders got selected for incentives under the scheme for a
cumulative capacity of 50 GWh per year.

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Accelerating India’s clean energy transition

Shovel-ready projects for implementation
Several projects targeting different segments of lithium-ion battery manufacturing value
chain are currently in the pipeline. All of these projects are led by private sector andlocated in Karnataka, Tamil Nadu, Telangana, Haryana, Gujarat and Himachal Pradesh.
The total manufacturing capacity of battery cells and components in the pipeline is~105 GWh/year, along with 2 GWh/year battery recycling and ~7 GWh battery packassembly.
Project Category

Project Capacity (GWh/year)

Battery Pack Assembly

7

Battery Pack Recycling

2

Battery cell / cell component Manufacturing

105

Source: EY research

Investment mobilization~INR 1.41 Lakh crores of investment is expected for operationalizing 114 GWh/year
capacity of the advanced chemistry battery manufacturing project pipeline till 2025.
Capital Investment – Equity

Capital Investment – Debt

~INR 42,418 crores~INR 98,975 crores

For 114 GWh/year of capacity ofbattery cell/pack manufacturing

For 114 GWh/year of capacity ofbattery cell/pack manufacturing

Social benefits

Fresh jobs created~4.33 lakhs

The total pipeline of battery cell andbattery pack manufacturing facilities
is estimated to generate ~4.33 lakh
direct–indirect employment.

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2

3

4

For 114 GWh/year of capacity ofbattery cell/pack manufacturing

5

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1. Reimagine the ACC PLI scheme to promote local value
addition via battery materials recycling industry

2. Implement grand innovation challenges for solar PV andenergy storage industry to pilot and demonstrate costeffective, durable technologies made from earth abundantmaterials

Recommendations

India being a resource constrained region for critical ACC battery materials(a.k.a cathode active materials) such as lithium, recycling should naturally gain
prominence in shaping policy. The ACC PLI scheme currently mandates up to
60% local value addition within five years. Upstream requirements for ACC
battery cell production include sourcing raw materials and chemical refining
for production of cathode active materials, a critical step in the production ofcathode, which is the largest cost centre (~54%) in the Li-ion battery bill ofmaterials.

65

The stationary storage industry can compromise on energy density and roundtrip efficiency of advanced chemistry battery cells if other performanceparameters such as long duration storage, levelized cost / kWh and life (no. ofcharge – discharge cycles) are superior to existing technologies. Levelized costof energy storage is a key performance parameter for stationary ESS solutions
and has to compete with levelized cost of energy from fossil fuels for scalingup adoption in India.

Moreover, the explosion in number and capacity of battery giga-factories
globally has not been met with comparable growth in supply chain of active
materials. Therefore, a competitive recycling industry is a crucial component
for achieving India’s objectives of self reliance in ACC batteries. Recycling
used batteries, especially without domestic natural reserves, is India's bestalternative to boost domestic battery materials production and further
enhance opportunities in other sectors of the supply chain. Indian companies
can develop a competitive edge in sourcing critical battery materials throughrecycling and establish an important foothold in the rapidly expanding EV
ecosystem. It is critical that battery raw material production is achieved
through setting up sizeable recycling capacity, but also that it is done in themost eco-friendly and sustainable ways.

The Government through CSIR (Council of Scientific and Industrial Research)
could invite applications from both domestic and international players to
conduct joint R&D initiatives with premier academic institutions for building
advanced chemistry battery cell prototypes made from earth abundantelements that enables long duration storage (>20 hours per cycle) and lasts
much longer that existing ACC batteries. The grand challenge should aim tolaunch commercially viable products that cost < 50 USD / kWh when produced
at scale.
Likewise, due focus is necessary to prepare technology blueprints and invest
in emerging as well next generation technologies governing solar cells,
examples being:

In fact, setting up large-scale capacity to recover valuable metals from usedbatteries has become a key milestone for all major governments throughout
the globe. India should also embrace this view and seize the recycling
opportunity to mitigate key supply chain risks.

Accelerating India’s clean energy transition➢

Monocrystalline Interdigitated Back Contact (IBC) Cells➢

Monocrystalline Hetero-Junction (HJT) Cells➢

Monolithic Solar Cells➢

Perovskite PV Cells

To provide boost to domestic manufacturing, setting aside dedicated funds forinvesting in R&D and providing incentives for indigenous production isrecommended.

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Pipeline of EV charging
infrastructure projects

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Accelerating India’s clean energy transition

Pipeline of electric vehicle (EV) charging infrastructure
Introduction
India is among a handful of countries that support the global EV30@30 campaign, whichtargets to have at least 30% new vehicle sales electric by 2030. As per ACMA, India’s EV
market in FY21 comprises 61% electric two–wheelers, 37% electric three–wheelers andlight commercial vehicles, 2% electric four–wheelers, and 0.2% e–buses. To support
mass adoption of EVs, India will need to deploy a robust electric vehicle public charging
infrastructure. Currently, 19 states have dedicated EV policies for encouraging mass
adoption and investments.

EV charging infrastructure rollout under national programs
Phase–II of FAME scheme was launched in 2019 with an outlay of Rs. 10,000 Crore fora period of three years initially and the same is now extended until 31 March 2024. Outof total budgetary support, about 86 percent of fund has been allocated for demand
incentives to create demand for EVs in the country. There are currently 164 EV models
registered for FAME II purchase incentives, 2.5 lakh EVs sold with incentives to the tuneof ~INR 935 crores. The Department of Heavy Industries (DHI), Government of India,
which is the nodal agency for administering incentives under FAME II, invited proposals
for deployment of 174 EV charging stations on 1,775 kms stretch of expressways and
1,370 stations on 13,370 kms stretch of highways in October 2020. The Ministry ofPower has sanctioned 2,877 charging stations in 68 cities across 25 states and UTs and1576 charging stations across 9 expressway and 16 highways as of December 2021.
Currently, the project pipeline for EV charging stations under Fame II scheme
accumulates to a total of 5131 stations.
SchemeNo. of EV charging
stations under pipeline

FAME–II

5,131

1,462

15,393

Private Contracts

3,41,098

97,213

10,23,295

State Tenders

1,55,140

44,215

4,65,421

Grand Total

5,01,370

1,42,890

15,04,109

67

Accelerating India’s clean energy transition

CAPEX outlay Sum of number of job(INR crores)
years created

Revised consolidated guidelines and Standards for charging
infrastructure for Electric Vehicles (EV)In January 2022, the Ministry of Power promulgated the ‘revised consolidated
guidelines and standards for charging infrastructure for Electric Vehicles (EV)’. Among
many issues, these guidelines have fixed the timelines for providing grid connectivity for
installation of public charging stations, which is a right step for ease of setting up thiscritical infrastructure. The state electricity regulatory commissions will have to enforce
these guidelines in letter and spirit. The guidelines lay down the following locational
density targets for deploying public EV charging stations:► At least one charging station in every 3x3 km grid
► One charging station every 25 km on both sides of highways and roads► One fast charging station every 100 km on highways / roads for long range/ heavy duty EVs
Many factors including EV penetration in the 2W/3W/4W markets, optimal capacity
utilization of charge points, ease of setting up charging stations, economics of operating
EV charging stations etc., determine the speed and scale of achieving the EV charging
infrastructure density targets with industry support. The need for EV charging
investment and deployment is irrefutable. But the demand and other uncertainties
combine to make public charging infrastructure risky and an unattractive investment.
To achieve scale, debt financing is critical and the industry must gradually reduce
dependence on policy driven subsidies. Simply put, the business case needs to improve
substantially. It is critical to understand the levers that can increase revenues andreduce costs to make the business case more appealing to mainstream debt investors.
There are significant commercial, structural and operational levers to reduce latency,
enhance revenues and cut costs. Smart charging services, advertisement, retailcolocation and network interoperability are levers for revenue enhancement.
In this context, the guidelines promote revenue sharing model for setting up publiccharging stations. Land available with the Government/Public entities can be monetizedfor installation of Public Charging Stations on a revenue sharing basis at a fixed rate of₹ 1 / kWh (used for charging). This is a step in the right direction if adopted widely withtransparent and competitive bidding mechanisms.

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State level initiatives for EV charging infra roll out
Some states like Andhra Pradesh, Assam, Delhi, Telangana, and Uttar Pradesh have set
concrete targets for EV charging infrastructure rollout. The Andhra Pradesh and Uttar
Pradesh EV policies have targets of 0.1 and 0.2 million charging stations, respectively,
to be built by 2024. Delhi and Kerala aims to have chargers located every 3 km in urban
areas and every 25km on highways, whereas Bihar, Haryana, Karnataka, Madhya
Pradesh and Telangana aims to have chargers located at every 50 km on all highways.
State EV policies primarily rely on capital subsidies to realize these targets. Tamil Nadu
aims for installing at every 25 km on highways along with 10% public parking incommercial areas. Whereas Punjab specifies to setup 1 of 5 parking in residential/non
residential buildings. Reimbursement of the net state’s goods and services tax (SGST)and exemption on electricity duty & stamp duty are provided in states like Andhra
Pradesh, Haryana, Tamil Nadu, Telangana, Uttar Pradesh, and Karnataka. Interest freeloans are also provided by the Karnataka state government to those setting up charging
stations. Eleven Indian states provide special EV tariffs for public charging stations
whereas twelve states are providing capital subsidy to charging manufacturingindustries of various scale. State governments in 15 states are providing subsidies for
initial build out of public charging stations @25% of capital cost or INR 10 lakhs/station
whichever is lower. The Delhi government provides a grant of up to 100% on charging
equipment set up by building owners, whereas Uttar Pradesh provides 25% rebate on
the market rate for land procured for setting up charging points.

Socio economic benefits
The EV charging infrastructure under pipeline would require a capital outlay of INR1.4
Lakh Crores, and is expected to generate approximately 15 lakh skilled/unskilled jobs.

68

Project Pipeline (sanctioned) for setting up EV charging stations
No. of EV Total CAPEX
charging
Outlaystations (INR crores)

Project
location
Andaman &Nicobar Islands

Equity(INR crores)

Debt(INR crores)

Number ofJobs
created*

20

6

2

4

60

AndhraPradesh

1,00,610

28,674

8,602

20,072

3,01,830

Assam

20

6

1

3

60

Chhattisgarh

25

7

2

5

75

30,277

8,629

2,589

6,040

90,831

Gujarat

195

56

11

25

585

Haryana

1

0

0

0

3

1,350

385

103

240

4,050

Kerala

442

126

27

63

1,326

MadhyaPradesh

200

57

7

15

600

Maharashtra

414

118

23

53

1,242

Meghalaya

11

3

0

1

33

Odisha

25

7

1

2

75

Tamil Nadu

162

46

14

32

486

Telangana

800

228

68

160

2,400

Delhi

Karnataka

Capital Investment

Fresh jobs createdUttar Pradesh

100

29

3

6

300

~INR 1.4 Lakh crores~15 Lakh jobs

Uttarakhand

10

3

1

2

30

Pan–India

3,66,708

1,04,512

28,15865,703

11,00,123

For 5 Lakhs electric vehicle
charging stations

For 5 Lakhs electric vehicle
charging stations

Grand Total

5,01,370

1,42,890

39,611

92,426

15,04,109

Accelerating India’s clean energy transition* Supply chain and operation related jobs are considered
Source: EY research, Department of Heavy Industry

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1. Promote coupling of EV charging with
low–cost renewable energy systems

Recommendations

There is need to reimagine ways for promotingease of charging EVs with low–cost renewableenergy (RE) systems. Coupling EV charging with
low–cost renewable energy systems can go along way in improving the economics of both EV
and RE adoption. The guidelines notified by
Ministry of Power has taken its first step in thisdirection for public charging stations by allowing
open access, stipulating the timelines for open
access applications and applicable open accesscharges.

69

2. Rationalize GST on Lithium Ion
batteries to support battery
swapping facilities
There is immense potential for battery swapping
facilities to reduce upfront cost of EVs (decouple
batteries from vehicles) and at the same timeallow for seamless battery powered operation of
EVs through swapping facilities. The
Government of India recently announced its
intentions to formulate battery swapping policy
to enable this transition.
The policy should aim to resolve following major
concerns for EV suppliers and battery swapping
investors :► Lack of uniform specs / standardization ofbattery form factors for seamless
interoperability / fitting of batteries atservice centres► 18% GST on lithium ion batteries can makethe entire business model unattractive

Accelerating India’s clean energy transition

3. Promote electric utility-driven business models for setting up EV charging Infra
There are ample opportunities for Indian DISCOMs to gradually diversify services towards EV charge point
operations, leverage synergies with renewable energy integration and generate sustainable alternate
revenue streams. DISCOMs should plan and initiate asset monetization drives by simply leasing the realestate located in prime locations identified by private players. DISCOMs can also opt for revenue sharing
models wherein utility investment can be targeted towards setting up electrical infrastructure components
such as transformers, transformer pads, service meters, service panels, cables, conductors, smart griddevices etc. Strategic public private partnerships with OEMs of automotive components and EV chargers /EV supply equipment can be explored for leveraging the benefits from higher economies of scale.
Investment / cost items
Type ofBusiness
ModelsLand/
location

Revenue items

Other add
on services
EVSE
Electrical(e.g.
equipment infrastructure
advertising,parking)

Revenuefrom rent /lease oflocation

Revenuefrom sale ofelectricity

Utility fullyowned (endto-end)
Utilityprovidingaccess tolocation only
Utilityprovidingaccess tolocation andinvesting inelectricalinfrastructure
Utility
investing inland and
electricalinfrastructure

Utilities

NA
Charging operators

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Revenuefrom EV
charging
stations

Revenuefrom otheradd onservicesStimulus measures foraccelerated economic recovery
70

4. Promote smart charging and otheralternate revenue levers for EV charge point
operators and investors

Revenue enhancement and cost–reduction levers

The principal challenge for setting up EV charging infra is thatthe business case for investment may not stack up in the
traditional sense. Understanding how to position the businesscase, and which levers to pull, can unlock investment
channels to accelerate infrastructure rollout. And that is a
trigger in the national journey toward decarbonization.

Cost levers

On an average, the payback period for an investment in public
EV charging infrastructure is 10+ years. The business caseneeds rethinking to support predicted EV growth. There are
significant commercial, structural and operational levers to
reduce latency, enhance revenues and cut costs.
Re–modelling the business case can boost the investment risk
profile, give greater appeal to mainstream debt financiers andenable infrastructure to scale.

Revenue levers

Smart charging
services
Setting up EV charging
stations alongside preexisting retail stores
Advertisement
Auxiliary revenue
stream fromadvertisements at the
charging locations

Smart charging
services
Revenues from grid
flexibility services,such as demand
response throughcoordinated charging
and discharging of EVs

The conventional business case struggles to justify EV
charging infrastructure investment. Poor cashflow andreturns are jeopardizing the case for investment in public EV
charging infrastructure. EY research finds that a typicalcharging station, with two slow (6.6kW) and two fast (50 kW)
chargers, will take five years to yield positive cashflow. Our
analysis shows that the payback periods for charging
infrastructure investments are longer than 10 years.

The need for EV charging investment and deployment isirrefutable. But the uncertainties combine to make publiccharging infrastructure risky and an unattractive investment.
In fact, more than three–quarters (76%) of total capital inflows
into EV charging companies in 2019 is equity,
grants/subsidies or venture capital. To achieve scale, debt
financing is critical. Simply put, the business case needs toimprove.

Accelerating India’s clean energy transition

Vertical co-investment
Getting players fromdependent industries in the
product(s) vertical value chain
to coinvest in the asset

1

2

3

4

5

Neutral hosts
Capex reduction byfinding partners thatprovide real estateand fund charger
costs in lieu of fixedrevenue share

6

7

8

Network
interoperability
Opening up
proprietyregisteredcharging stations
to all drivers,
irrespective of
their subscription
contract withother networks

It is critical to understand the levers that can increase revenues and reduce costs to make the business case more appealing to mainstream debt investors.

Impact of Levers

Stimulus measures foraccelerated economic recovery

Levers71

Revenue enhancement

Smart charging services

Advertisement

Retail colocation

Network Interoperability

Cost reduction

IRR Improvement

32%

8%

6%

7%

12%

6%

20%

4%

Vertical co-investment

35%

Neutral hosts

5%

47%

12%

* In the figure above, revenue enhancement accounts for the incremental revenue each lever adds in the 10th year. Cost reduction takes into account the
capex reduction achieved under these levers. Smart charging services considers Internal Rate of return (IRR) improvement when compared with the base case.

Accelerating India’s clean energy transition

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Enabling Green Hydrogen
policies to decarbonize
manufacturing sector

872Accelerating India’s clean energy transition

Green hydrogen policy enablers:

500 GW of
non–fossil energy
capacity by 2030

Definition of ‘Green hydrogen /ammonia’

Produced by way of electrolysis of water using renewable energy including production from biomass

Waiver of inter-statetransmission (ISTS) charges

Grant of Open AccessBanking of surplus renewableenergy50% of electrical energy
capacity from renewableenergy sources by 2030

Reduce 45%
carbon intensityof economy by2030

Panchamrit of India’s climate
actions announced during
COP26 Glasgow

Reduce total projectedcarbon emission by one
billion tonnes by 2030

Granted for a period of twenty five years for projects commissioned before 30 th June 2025

Open access for sourcing renewable energy will be granted within
fifteen days of receipt of application complete in all respects

Banking permitted for a period of 30 days forrenewable energy used in the production ofgreen hydrogen/ammonia

Open access charges as per existing rules

Banking charges fixed by state commissions not more than costdifferential between average tariff of procurement and market
clearing price in DAM

Grant of ISTS connectivity

Connectivity granted on priority under the Electricity (Transmission System Planning, Development and Recovery ofInter State Transmission Charges) Rules 2021

Land acquisition for greenhydrogen production

Allotment of land in renewable energy parks for green hydrogen/ammonia production

Source: Ministry of Power, Government of India, 2022

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Achieve net–
zero emissions
by 2070

Accelerating India’s clean energy transition

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Green hydrogen policy enablers (cont.):

Manufacturing zones

Bunkering and storage

RPO compliance

Manufacturing zones proposed to be set up for cluster based development of green hydrogen supply chain

Manufacturers of green hydrogen / ammonia allowed to set up bunkers near ports for storage and exports byshipping. Land to be provided for storage by port authorities at applicable charges.

Renewable energy consumed for production of green hydrogen / ammonia shall count towards RPO compliance ofthe end-user entity. Renewable energy consumed beyond obligation of end-user shall be counted towards RPO
compliance of DISCOM in whose area the project is located.

Single window portal

MNRE will establish a single window portal for all statutory clearances, permissions required for manufacture,transportation, storage and distribution of green hydrogen / ammonia preferably within 30 days ofdata of application

Demand aggregation

MNRE may aggregate demand from different sectors and have consolidated bids for procurement of greenhydrogen / ammonia through designated implementing agencies‘Electricity (Promoting Renewable
Energy Through Green Energy
Open Access) Rules, 2022’.

Cross subsidy surcharge and additional surcharge shall not be applicable if green energy is utilized for productionof green hydrogen and green ammonia
Source: Ministry of Power, Government of India, 2022

74

Accelerating India’s clean energy transition

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8

Green Hydrogen Policy notified in Feb’22 is a timely intervention for the industry betting on
the promise of establishing competitive supply chains
India’s ‘Green Hydrogen Policy’ will kick start energy transition efforts, particularly in theemission intensive industrial sectors.
One of the key highlights of this policy, the waiver of inter-state transmission charges forgreen hydrogen production plants commissioned up to June 2025 sourcing electricity
produced from renewable energy sources was already existing from the order dated 23rd
November 2021. However, this order had provisioned waiver for first 8 years of operations
only. The ‘Green Hydrogen Policy’ has extended the waiver for 25 years of plant
operations, which is a welcome step in ensuring long term cost reduction of greenhydrogen production for the industry. One must note that green hydrogen production units
must be connected with ISTS network at the point of GH2 production to fully realize thebenefits of this waiver. Otherwise, respective state transmission charges may still apply.
Therefore, States which extend similar waivers for intra-state transmission could
become preferred locations for green hydrogen production units.
The policy also provides 30 days banking facility and limits the applicable banking charges
for the renewable energy used in the production of green hydrogen. This is also asignificant step, especially when the restrictions on banking provisions for renewableenergy are increasing in many states. Banking is permissible only for intra-statetransactions and therefore the industry will benefit from this provision only when the stateelectricity regulatory commissions amend their banking regulations accordingly. Renewableenergy systems designed for green hydrogen production are typically oversized to accountfor variability. Banking allows green hydrogen producers to supply excess renewableelectricity to the grid, with the option of drawing back the same amount of power within acertain period and against the banking charges specified by State Electricity Regulatory
Commissions. Until recently, many States offered annual banking provisions but have now
moved to a monthly banking period, and in some cases have completely withdrawn banking
facilities for renewable energy projects. Therefore, the industry will watch closely on how
the States which have already restricted banking provisions will adopt the 30 days banking
facility and the formula specified for limiting banking charges specified in the greenhydrogen policy.

75

Accelerating India’s clean energy transition

Similarly, the effectiveness of few other provisions in the green hydrogen policy such as
granting open access for renewable energy sourced within 15 days and land allocation in
renewable energy parks will depend on the efforts from State governments towards
proper adoption and enforcement.
The ‘Electricity (Promoting Renewable Energy Through Green Energy Open Access)
Rules, 2022’ notified recently is a step in the right direction to lower the cost of open
access renewable energy supply for green hydrogen production. As per these rules crosssubsidy surcharge and additional surcharge shall not be applicable if green energy isutilized for production of green hydrogen and green ammonia. India’s green hydrogen
policy framework must further evolve to boost demand for green hydrogen throughpurchase obligations/blending mandates particularly for bulk consumers of hydrogen as
industrial feedstock or process gas. Viability Gap Funding should be extended along withsuch purchase obligations for bulk consumers of hydrogen as feedstock. Green hydrogen
blending with piped natural gas is another major market for boosting demand. The policy
must focus on boosting R&D investment with public private partnerships (PPP) andgrand challenges to demonstrate efficient and cost effective GH2 electrolysers, storage
and delivery solutions using earth abundant electrocatalysts and materials. A concreteroadmap towards developing testing facilities and certification mechanisms relying on
globally harmonised standards and regulations for Green hydrogen production, storage
and delivery is needed. VGF may also be provided for projects where green hydrogen
could act as alternate energy carrier for enabling low carbon steel, cement, trucking andmaritime shipping. The policy must also endeavour towards creating world class talent in
the value chain of green hydrogen by way of introducing dedicated academic programs/
degrees and establishment of national research institutes. This is important to kick start
the indigenization of technology development and support the industry ambitions
towards R&D, product development and services in the entire value chain.
Overall, the supporting ecosystem required for indigenization of GH2 production needs
parallel efforts with incentivizing the end-users for demand creation.

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Recommendations for sub-national
green hydrogen policy frameworks
76

The following sections highlight key policy interventions to be adopted bystates (sub-national actors) until green hydrogen supply chain andadoption achieves sufficient economies of scale.

1. Reducing the cost of renewable power generation and supply
for GH2 production
Round the clock renewable power generation accounts for 40-50% of thelevelized cost of green hydrogen production and storage (LCOH). Subnational policy frameworks should aim to minimize the cost of this criticalsupply chain component and significantly improve the ease of doing open
access transactions. In this regard, the draft Electricity (promoting renewableenergy through Green Energy Open Access) Rules, 2021 notified by Ministryof Power, Government of India in August 2021 is a step in the right direction.
However, the responsibility of facilitating open access lies with the StateElectricity Regulatory Commission as per Section 42 and Section 86 of theElectricity Act, 2003. Therefore, the central rules and other State level policy
interventions should ultimately manifest as amendments to existing open
access regulations at state level for meaningful outcomes.
► Waiver of Intra-state transmission charges for GH2 production

The national green hydrogen policy notified in Feb’22 has announced thewaiver of inter-state transmission charges for a period of 25 years for greenhydrogen production units commissioned before 30th June 2025. However,green hydrogen production units must be connected with ISTS network at the
point of GH2 production to fully realise the benefits of this waiver. Otherwise,
respective intra-state transmission charges may still apply. In this regard,
States that extend similar waivers for intra-state transmission charges will
enable industry to gain competitive advantage in the production of greenhydrogen. Such waivers can extended for limited periods Or limited for first
0.5 – 1 million tons of annual GH2 production to help achieve economies ofscale. Open access regulations could explore mechanisms to socialize thecost of this waiver to reduce fiscal burden.

Accelerating India’s clean energy transition► Waivers, clarity and certainty of open access charges for GH2 production► State governments should extend waivers for levy of open access charges (e.g.

banking, cross subsidy, additional surcharge etc.) for the first 0.5 – 1 Million
tons of GH2 production to reduce cost and encourage GH2 adoption. If not
viable, open access charges should be kept at minimum with clarity and certainty
of its validity period in the regulations.
► Allow banking of surplus energy in the production of GH2► Existing open access regulations should be amended for allowing banking of atleast 10% annual generation for min. 30 days in line with national greenhydrogen policy.
► Fungibility of green hydrogen and renewable purchase obligations► Open access regulations should specify mechanisms for monitoring, verification,

certification and accounting to enable such fungibility of purchase obligations.

2. Improve ease of doing renewable energy open access (REOA)
transactions
Rule#6 and 7 in draft Electricity (promoting renewable energy through Green
Energy Open Access) Rules, 2021 focus on streamlining, centralizing andstandardizing open access approval processes for renewable energy transactions.
Given delays in processes and existing complex processes, such an approach isneeded. A centralized registry is proposed to enable single window clearance for
REOA applications. The applications are to be routed through the state nodal
agency which as per Rule 6 (2) would either be the SLDC for STOA and the
CTU/STU for LT/MTOA. As per Rule 7 (2) complete applications are to be uploadedby the nodal agency and in order to prevent delays, applications are deemed
approved after 15 days subject to technical requirements specified by the ERC.
Further as per Rule 7 (4) and (5) denial of open access should take place with awritten order and the applicant has the right to be heard. Further appeal against
orders by the nodal agencies are to be processed by the State Commission.
Existing open access regulations should be amended suitably with above
provisions.

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Recommendations for sub-national
green hydrogen policy frameworks
77

3. GIS mapping and identification GH2 clusters for efficient
infrastructure development

6. Production linked incentives and fiscal benefits for highefficiency and durable electrolyser systems

States should undertake GIS mapping of renewable energy resource richlocations, GH2 demand centres - for example crude oil refineries, fertilizer
industries, iron and steel manufacturing units, ports, industrial SEZs andtransport corridors (roadways, railways, inland waterways), land use – land
cover (LULC) in the vicinity of GH2 demand centres, water bodies for sourcing
fresh water used in the production of electrolysis etc. GIS mapping along withother geospatial characteristics, potential demand for GH2 and other relevant
attributes should be gathered to rank / prioritise various clusters with respect
to their inherent capability of supporting a GH2 economy, supply chain andconsumption.

Electrolyser systems account for 30-40% of the levelized cost of greenhydrogen production and storage (LCOH). Sub-national policy frameworks
should aim to minimize the cost of this critical supply chain component.
Therefore, States should offer additional incentives (apart from national PLI
scheme if any) linked to production of high efficiency and durable
electrolyser systems. Electrolyser systems used in the production of GH2
should be brought in the lowest GST slab or waived off completely. Importduties must be kept at minimum until the emergence of local manufacturingindustry.

4. Establish State level mission for advancing GH2 economy,
formulate and adopt GH2 production targets separately forindustries, transportation and other sectors of the economy

7. Enhance public funding support towards R&D programs
calling for demonstration of projects that support
competitiveness of GH2 supply chain and end-use

States must establish GH2 mission with a governance mechanism forinterdepartmental coordination, monitoring and evaluation of policy
interventions. The governance mechanism should include be represented byenergy, industries, and transport departments at the minimum.

State budgetary resources should be allocated towards creating centres of
GH2 excellence, robust coordination mechanisms to aggregate demand,
cutting edge R&D calling for demonstration of following projects:► Cost effective high efficiency durable electrolysers made with earth

Robust and predictable demand for GH2 is essential for accelerating
investments in the supply chain. In this regard, States must adopt short,medium and long term GH2 production targets separately for crude oil
refineries, fertiliser industries, iron and steel manufacturing units, otherindustries, transportation sectors etc.

abundant electrocatalyst materials► Hydrogen based direct reduced iron (H2-DRI) and electric arc furnacesteel projects► Cost effective Hydrogen fuel cell powered transportation solutions

capable of competing with conventional ICE engine and / Or battery
electric systems

5. Single window portal for all statutory clearances, permissions
required for manufacture, transportation, storage anddistribution of green hydrogen / ammonia► Cost effective hydrogen storage materials and solutions made fromearth abundant materials

States should establish single window mechanisms in coordination withcentral institutions for facilitating all statutory clearances, permissions
required for manufacture, transportation, storage and distribution of greenhydrogen / ammonia.

Accelerating India’s clean energy transition

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Annexures

78

Accelerating India’s clean energy transition

ANNEXURE I: Battery and component manufacturing projects
Project Pipeline for Assembling Advanced Chemistry Battery Packs

Project Pipeline for Manufacturing Advanced chemistry Battery Cells
Promoter
type

Location

Production
Project
Capacity
Status(MWh/year)

PrivateHaryana

220 million
pieces Planningper year– Jan–2022

PrivateHimachal
Pradesh240– Planning– Jan–2022

Private

PLI scheme

5,000 Announced– Jan–2022

Public

PLI scheme– Planning– Jun–2021

Private

PLI scheme

20,000 Announced

Private

PLI scheme

PrivateProduction
Project
Capacity
Status(MWh/year)

Expected
Year ofCapital outlay
announcement(Crores INR)

Promotertype

Government
supportPrivate

PLI scheme

10,000 Announced

7,000 Jan–2022

Private

PLI scheme

5,000 Announced– Jan–2022

Private

PLI scheme

20,000 Planning

Private

PLI scheme

PrivateExpected
Year ofCapital outlay
announcement(Crores INR)
7,083 Aug–2020

Underconstruction– Feb–2021–

1,000 Announced

300 Jul–2021

PrivateTelangana

2,400

Under
construction– Nov–2020

PrivateUttar Pradesh

1,000 Announced

185 Oct–2021– Jan–2022

PrivateGujarat– Announced

4,000 Mar–2021

20,000 Announced

2,000 Jan–2022

PrivateTamil Nadu

500 Announced

500 Nov–2021

PLI scheme

5,000 Announced

4,000 Jan–2022

PrivateHaryana240

Underconstruction

200 May–2021

Private

PLI scheme

5,000 Announced

2,000 Jan–2022

PPP–– Planning

Private

PLI scheme– Announced

2,000 Jan–2022

PrivateTamil Nadu–

Nov–2021

Private– Announced

2,000 Mar–2021

Underconstruction

Private5,000 Announced

4,015 Jul–2021

Private–– Announced

Feb–2021

PrivateTamil Nadu

1,200 Announced

100 –PrivateUnder
10,000construction

2,500 Aug–2021

PrivateTamil Nadu

400 Announced–

79

PLI scheme

Accelerating India’s clean energy transition

Feb–2021

ANNEXURE I: Battery and component manufacturing projects
Project Pipeline for Manufacturing advanced chemistry battery cell components
Expected Capital outlay
Year of announcement(Crores INR)

Category

Promoter type

Production Capacity

Project Status

Cathode manufacturing

Private–Announced

2,000 Oct–2021

Synthetic Graphite
Manufacturing

Private40,000 tonnes of graphite
anode by 2025

Announced

2,000 Oct–2021

Anode precursor
material manufacturing

Private15,000 TPA

Under construction– Aug–2020

Recycling

Private–Planning– Jun–2021

Recycling

Private11,000 tons

Announced

300 Dec–2021

Recycling

Private2000 MWh/year

Announced

300 Jul–2021

80

Accelerating India’s clean energy transition

ANNEXURE II: Green Hydrogen Projects
Green Hydrogen production projects

State of
Project Location

Date ofannouncement

Project Promoter(Public / Private)

PAN India

Mar-21

PrivateTamil Nadu

Mar-21

Public500 kW – 1000 kW

Uttar Pradesh

Jun-21

Public

50kW, 0.13 TPD

Andhra Pradesh

Jul-21

Public1.25 MW solar plant for green electricity generation source

LadakhJul-21

PrivatePAN India

Jul-21

PrivateElectrolyzer manufacturing plant: 0.5 to 2GW/year

Karnataka

Aug-21

Public25 kW

LadakhAug-21

PublicPAN India

Aug-21

PrivateGujarat

Sep-21

PrivatePAN India

Oct-21

Private2 MW Solar plant to be used for electricity production forelectrolyser

GujaratOct-21

Public5 MW PEM Electrolyzer project- 2TPD Hydrogen production plug
power makeMadhya Pradesh

Oct-21

Private-Oct-21

Public

4.3 Ton per day (TPD) Hydrogen production

Madhya Pradesh

Oct-21

Private50 kiloton per annum

Madhya Pradesh

Nov-21

Public100 MW in the first phase + a 25 kW self-developed Fuel cell pilot
project

PAN India

Nov-21

Public20 MW

81Accelerating India’s clean energy transition

Hydrogen production or Electrolyzer capacity

Electrolyzer Manufacturing plant: 2.5 GW/year

ANNEXURE II: Green Hydrogen Projects
Green Hydrogen production projects

State of
Project Location

Date ofannouncement

Project Promoter(Public / Private)

Madhya Pradesh

Nov-21

Public40 MW/5000MT per annum (Uttar Pradesh) and 15 MW/2000
MT per annum (Haryana)

Uttar Pradesh and Haryana

Nov-21

Public200MW - 2GW

PAN India

Dec-21

PrivatePAN India

Dec-21

PublicPAN India

Dec-21

PrivatePAN India

Dec-21

PublicMaharashtra

Jan-22

Private

1 GW

PAN India, Europe and UK

Jan-22

Private

1 GW

PAN India

Feb-22

PrivatePAN India

Apr-22PPP

Not reported

Apr-22PublicPAN India

Apr-22

PrivatePAN India

May-22

Private82

Accelerating India’s clean energy transition

Hydrogen production or Electrolyzer capacity

>2 GW

1 GW

ANNEXURE II: Green Hydrogen Projects
Green Hydrogen research and development projects
Project Category

Project nameDate of announcement

Estimated date of projectcommissioning

State of Project
Location

Green Hydrogen

Bio-Inspired Hydrogen Evolution from Water:
Troubleshooting Practical Limitations

2019

Jun-22

West Bengal

Green Hydrogen

Development of efficient and robust working
electrodes/photocatalysts for solar energy conversion tohydrogen via photoelectrochemical/ photocatalytic splittingof water: Next level up-scaling of laboratory experience2020

Dec-23

Uttar Pradesh

Green Hydrogen

DEEP: Development of an Efficient Photoelectrode for
Hydrogen Fuel from Water

Jan-19Jun-22

West Bengal

Green Hydrogen

Demonstration and validation of hydrogen ecosystem forstationary power backup application for telecommunication
towers

Feb-19Jun-22

Tamil Nadu

Green Hydrogen

Improved hydrogen production from biogas using sorption
enhanced reforming

Feb-19Jun-22Maharashtra

Green Hydrogen

2D Transition Metal Layered Double Hydroxides: A
CostEffective Catalyst for Hydrogen Production by(Photo)Electrochemical Water Splitting

Jul-21

Mar-24

West Bengal

Green Hydrogen

Development of first-of-its-kind mobile device for production
Nov-21of ultra pure green hydrogen

Hydrogen Storage

Unraveling the potential of graphene quantum dots forhydrogen storage in fuel cells, DST, India

2019

Jun-22

Madhya Pradesh

Hydrogen Storage

Hydrogen Storage Materials: Optimization of known
materials, developing new storage materials and finding
exploratory application

Feb-20Jun-23

Uttar Pradesh

83

Accelerating India’s clean energy transition

PAN India

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Notes85

Accelerating India’s clean energy transition

Notes86

Accelerating India’s clean energy transition

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Established in 1927, FICCI is the largest andoldest apex business organisation in India. Its
history is closely interwoven with India's
struggle for independence, its industrialization,and its emergence as one of the most rapidly
growing global economies.

A non-government, not-for-profit organisation,
FICCI is the voice of India's business andindustry. From influencing policy to encouraging
debate, engaging with policy makers and civilsociety, FICCI articulates the views and concernsof industry. It serves its members from theIndian private and public corporate sectors andmultinational companies, drawing its strengthfrom diverse regional chambers of commerce
and industry across states, reaching out to over
2,50,000 companies.
FICCI provides a platform for networking andconsensus building within and across sectors
and is the first port of call for Indian industry,
policy makers and the international business
community.
Address: FICCI, Federation House, Tansen Marg,New Delhi 110001
Website: www.ficci.in
Email: power@ficci.com; renewables@ficci.com