Renewable Energy & Green Transition

E20 Blend Fuel: Benefits and Concerns

Context: India has mandated E20 petrol (20% ethanol, 80% petrol) and aims for E27 in the future, achieving the E20 milestone five years ahead of the original 2030 target. 

However, concerns are emerging over mileage loss, engine damage, and lack of consumer choice, especially for vehicles manufactured before 2023.

Relevance of the topic:

Prelims: About E20, Flex fuel vehicles.

Mains: E20 Fuel in India: Challenges, Concerns & Lessons from Brazil

Ethanol Blending

  • Ethanol Blending refers to the process of mixing ethanol, a biofuel derived from plant-based sources, with petrol to create a more sustainable and cleaner fuel. 
  • Ethanol is often produced from renewable sources such as corn, sugarcane, or other biomass. 
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India's Ethanol Blending Programme

The Government of India launched the Ethanol Blended Petrol Programme in 2003 to promote ethanol use in transportation fuel. 

  • 2003: EBP launched in 9 States & 4 UTs with 5% ethanol blend (E5).
  • 2013: National Policy on Biofuels notified.
  • 2018: National Policy on Biofuels revised — target of 20% blending by 2030.
  • 2021: The target of 20% blending advanced to 2025-26.
  • 2023: E20 fuel introduced in select cities.
  • 2025-26: Pan-India rollout of E20 planned.

Objectives: 

  • Reduce Crude Oil Import Bill: India imports >85% of crude oil needs. Blending ethanol with petrol helps reduce dependence on non-renewable fossil fuels. 
  • Enhance Energy Security: Diversify fuel sources.
  • Lower Carbon Emissions: Ethanol contains oxygen which can improve the combustion of fuel. This aids the complete burning of fuel and lowers emissions of certain pollutants like Carbon dioxide and carbon monoxide. 
  • Waste Utilisation: Use damaged grains, surplus rice and stubble will reduce waste. 
  • Boost Farmer Income: Assured procurement of surplus crops and farm residue will boost farmers' income. 

What is E20 Fuel? 

  • E20 is a fuel blend that comprises 20% ethanol produced from plant products such as sugarcane, rice, and maize, and 80 % gasoline. 
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Challenges and Concerns with E20 in India: 

  • Engine Compatibility Issues:
    • The majority of vehicles manufactured before 2023 are designed for E10 fuel only. 
    • Ethanol’s higher water content can corrode metals and damage non-ethanol-rated rubber seals, valves, and pistons.
    • Cold-start problems in winter due to ethanol’s higher ignition temperature.
  • Performance and Mileage Loss: Ethanol has a lower energy density (around 33% lower calorific value) than petrol and may cause a marginal decrease in mileage (fuel economy). 
  • Lack of Consumer Choice: Petrol pumps rarely disclose the blending percentage. No option for customers to buy pure petrol or lower blends like E10. 
  • No Price Incentive: Unlike Brazil, where ethanol is 25-35% cheaper, E20 in India is priced at parity with petrol, reducing consumer motivation.
  • Warranty and Liability Risks: Car manuals of popular models (Hyundai i20, Mahindra Thar, etc.) explicitly warn against using >10% ethanol; damage may void warranties.
  • Rapid Policy Transition: Moving from E10 to E20 in a short time frame has created adjustment challenges for both manufacturers and consumers.
  • Infrastructure and Awareness Gaps: Limited roll-out of flex-fuel compatible vehicles and inadequate readiness of service and repair networks to address ethanol-related issues. 
  • Feedstock and Environmental Concerns: High dependence on water-intensive crops like sugarcane for ethanol production may exacerbate water scarcity and raise food-versus-fuel debates.

Case Study: Brazil’s Ethanol Blending Success

  • Brazil is a global leader in ethanol fuel adoption, offering a valuable model for India’s E20 programme. It launched its Ethanol blending scheme (EBS) in 1975 in response to the global oil crisis. 

The scheme leveraged Brazil’s abundant sugarcane resources to create a sustainable alternative to petroleum fuels. Key points of Brazil’s EBS: 

  • Phased Rollout: Gradual progression from E10 to E27, alongside introduction of E100 (pure ethanol), avoiding sudden stress on existing vehicle stock.
  • Flex-Fuel Technology: Cars capable of running on any blend of petrol and ethanol; by the late 1980s 90% of new cars were ethanol-compatible.
  • Transparent Consumer Choice: Fuel pumps display ethanol content; consumers select blends based on price and preference.
  • Economic Incentives: Ethanol priced 25-35% lower than petrol at the pump.
  • Public Engagement: Strong awareness campaigns highlighting both environmental and performance benefits.

Way Forward

  • Phased Rollout: Introduce E15 as an intermediate step for older fleets before full E20 coverage.
  • Mandate Flex-Fuel Engines: All new vehicles should be compatible with higher ethanol blends.
  • Transparent Labelling: Display blending levels at every pump.
  • Introduce Price Incentives: Ensure ethanol blends are cheaper to encourage voluntary adoption.
  • Consumer Awareness Campaigns: Address myths, highlight benefits, and explain precautions.
  • Independent long-term studies on E20’s impact on older engines.

India’s ethanol push is a strategic step towards energy self-reliance and climate goals, but its success will depend on harmonising policy ambition with market readiness. 

Also Read: Impact of Ethanol Production on Environment 

India’s Coal Reliance has Risen to 79%: MOSPI

Context: India’s coal reliance has risen to 79% in FY2024, as per the MOSPI’s latest Energy Statistics in India. Renewable energy sources have not seen any meaningful rise in the share of the total energy produced in the past decade, despite the push for renewable energy. 

Relevance of the topic:

Prelims: Key highlights of the MoSPI’s Energy Statistics in India 2025.

Mains: Reasons behind high reliance on coal. 

Key Stats in the Energy Sector

  • The share of coal in India’s total energy generation increased to 79% to 16,906 petajoules (PJ) in 2023-24, about two percentage points more than previous year (MoSPI’s Energy Statistics in India 2025). 
  • Coal has consistently accounted for over 70% of India's energy output since 2014-15. Despite increased domestic production, coal import dependence remains high (26%), peaking at 31% in 2019-20.
  • Crude oil’s share has been at 6% in 2023-24. This share has reduced from 2014-15 when it was 11% in 2014-15.
  • Natural gas was 7% of the total energy produced in 2023-24, down from 9% in 2014-15.
  • Renewable energy sources (hydro, solar, nuclear) have not significantly increased their share, standing at 7% in 2023-24 compared to 6% in 2014-15. Their share in total energy production has always been under 10% in the past decade. 
  • Estimated potential for generation of energy from renewable resources has reached 2109 GW as of March 2024. The highest potential for generation of energy comes from wind at 1163 GW (55%), followed by solar energy 749 MW (35.5%) and large Hydro.
    • India’s total renewable energy-based electricity generation capacity: 203 GW (2024).
    • India’s ambitious renewable energy target: 500 GW from non-fossil sources by 2030.
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Major Initiatives related to Renewable Energy Transition: 

  • Pradhan Mantri Kisan Urja Suraksha Evam Utthaan Mahabhiyan (PM-KUSUM): Focuses on solarisation of irrigation pumps. 
  • PLI Scheme for Solar PV Modules: Promotes domestic manufacturing of solar panels. 
  • Pradhan Mantri Suryodaya Yojana: Aims to provide rooftop solar to households. 
  • Solar Parks and Ultra Mega Solar Power: Encourages large-scale solar power projects. 
  • Green Energy Corridor Scheme: Facilitates transmission infrastructure for renewable energy. 
  • National Green Hydrogen Mission: Focuses on developing green hydrogen technology. 
  • National Bioenergy Programme: Promotes the use of biofuels. 
  • Pradhan Mantri Sahaj Bijli Har Ghar Yojana (SAUBHAGYA): Aims to provide electricity to all households. 
  • Green Energy Corridor (GEC): Facilitates the transmission of renewable energy. 
  • National Smart Grid Mission (NSGM) and Smart Meter National Programme: Modernises the electricity grid. 
  • Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles (FAME): Promotes the adoption of electric vehicles. 

Reasons for High Reliance on Coal despite Renewable Energy Transition Efforts: 

  • Stable and Reliable Energy Source: Coal-based power plants provide consistent base load electricity, essential for meeting India’s growing energy demands. Unlike intermittent renewable sources (like solar and wind), coal ensures uninterrupted power supply.
  • Economic Viability: Coal is one of the cheapest energy sources in India due to vast domestic reserves. Setting up coal-based power plants has lower upfront costs compared to renewable infrastructure. RE technology requires large capital investment, and large contiguous land, which are in short supply. 
  • Employment and Socio-economic Factors: Coal mining and associated industries provide jobs to millions, especially in coal-rich states like Jharkhand and Chhattisgarh. Phasing out coal would impact livelihoods and local economies, making the transition politically sensitive. 
  • Infrastructure Constraints to scale RE Energy: India has a well-established network of coal-based thermal power plants, which would require significant investment to replace. There is inadequate infrastructure for transmission of RE generated in remote locations to load centres. 

Impact of Air Pollution on Solar Power Generation in India

Context: A study by IIT Delhi highlights how air pollution and climate change will reduce India's solar power generation capacity. The study focuses on the impact of solar radiation, temperature rise, and air pollution on solar panel efficiency in India.

Relevance of the Topic: Prelims: Factors Affecting Solar Energy Efficiency; India's RE Target. 

India's Installed Solar Capacity and Targets

  • As of 2024, India is the third-largest solar power producer globally, after China and the US.  
  • India aims to generate 50% of its electricity from non-fossil fuel sources by 2030, and install 500 GW of renewable energy capacity, with solar energy playing a key role. 

Factors affecting Solar Energy Efficiency: 

  • Solar Radiation is the primary factor affecting solar cell performance.
    • Solar radiation at the earth’s surface undergoes significant long-term variations due to atmospheric variables such as clouds, aerosols or particulate matter, water vapour, and radiatively active gas molecules such as ozone. 
  • Clouds reflect and aerosols either scatter or absorb incoming solar radiation reaching the surface. On a cloudy or hazy day, due to particulate matter pollution, less solar radiation will impinge on the solar panel and reduce solar generation. 
  • Air pollution blocks solar radiation from reaching solar panels, resulting in less power produced. India has 300 sunny days a year but their quality is declining due to air pollution. 
  • Rising temperatures due to climate change also lower the efficiency of solar cells. Solar panels are designed to operate efficiently at a specific temperature range, typically around 25°C. The efficiency of solar panels tends to decrease as temperatures rise above 25°C. 
  • Wind speed and airflow also affect cooling, but have a lower impact than other factors. 

Major Highlights of the Study

  • Research Methodology: Used 1985-2014 data to project 2041-2050 scenarios based on NASA’s CERES project and IMD data.
  • Two scenarios studied :
    • Moderate climate action, weak pollution control → Greater efficiency loss.
    • Weak climate action, strong pollution control → Lesser efficiency loss (2.3% drop).
  • Estimated power loss of at least 840 gigawatt-hours per year due to efficiency drop. 
  • Regional variations in solar potential were highlighted, with Northeast India and Kerala expected to have higher solar energy output due to reduced cloud cover. 

Significance of the study: 

  • It provides valuable insights for policymakers and the solar industry to select better sites for future projects. 
  • It highlights the need for strong climate action and air pollution control measures. 

Way Forward

To mitigate the impact of air pollution and climate change on India's solar energy generation, the following policy measures can be adopted : 

  • Enforce stringent emission norms for industries and vehicles, and implement dust control measures in urban and industrial areas.
  • Expand real-time air pollution monitoring networks to track and mitigate sources of pollution affecting solar efficiency.
  • Invest in R&D for heat-resistant photovoltaic (PV) cells, self-cleaning panels with better cooling mechanisms, and hybrid solar-wind solutions.
  • Diversification of Solar Installations in cleaner air regions like the Northeast and coastal areas.
  • Promote floating solar installations on reservoirs and lakes to reduce dust accumulation and improve efficiency. 
  • Implement large-scale tree plantation drives to absorb pollutants and regulate temperatures.
  • Strengthen participation in global initiatives like the Paris Agreement and the International Solar Alliance (ISA) for funding and technology support.

Cutting greenhouse gas emissions and improving air quality are essential for maximising solar power generation.

Renewable Energy Expansion in India

Context: As of the latest data from the Central Electricity Authority, India's renewable energy (RE) sector is witnessing a significant expansion, with a substantial portion of RE capacity under construction.

Relevance of the Topic: Prelims: Renewable Energy: Key Trends; India’s RE Target.

Key Highlights of Renewable Energy Expansion

  • Total Installed Capacity: India currently has over 167 GW (1,67,709 MW) of installed RE capacity, including (including about 12,000 MW non-wind and non-solar sources such as biomass and small hydro).
  • Under-construction RE capacity of over 142 GW (1,42,667 MW) of RE, with the highest share from solar energy (over 82 GW), followed by solar-wind hybrid and wind energy projects. 
  • Gujarat, with over 46 GW of RE capacities under construction, leads the way in India’s RE development.  
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India’s RE Target

  • India has set a target to achieve at least 500 GW (gigawatts) of non-fossil power capacity by 2030, up from its current 165 GW (2024). 

Central Public Sector’s Role in Renewable Energy Development:

  • Four central public sector companies (CPSEs) under the Ministry of Power are involved in the construction of renewable energy plants, contributing to 8% of the total under-construction capacity.
  • NTPC’s leadership: NTPC is at the forefront with 5,417 MW of renewable energy projects under development, followed by SJVN and NHPC.

High concentration of renewable energy projects in a specific region (Gujarat and Rajasthan) may pose infrastructure challenges, particularly for energy distribution and grid management. Effective management of energy distribution across the regions is crucial to ensure grid stability.

Green Finance

Context: The government is working to set up a National Green Financing Institution to support its net-zero target by 2070. Current finance flows for climate initiatives remain much lower than the desired levels. 

Relevance of the topic:

Prelims: Green Finance; Green deposits; Green bonds.

Mains: Challenges to Green financing.

National Green Financing Institution (proposed)

  • The primary purpose of the institution will be to aggregate green capital from different sources and lower the cost of capital.
  • NITI Aayog is examining structuring mechanisms for operationalising a potential National Green Financing Institution, including a bank modelled on NaBFID/NABARD, repurposing existing institutions like IREDA; Climate Fund in GIFT city, Green InvIT, etc. (non-exhaustive) along with analysing best practices from Green Banks around the world. 

India’s Climate Commitments and need for Green Finance

  • As part of its climate commitments or Nationally Determined Contributions (NDCs) submitted to the United Nations Framework Convention on Climate Change (UNFCCC) in 2022:
    • India aims to reduce its GDP emission intensity by 45% by 2030, compared to 2005 levels.
    • India aims to achieve 50% of its installed electric power capacity from non-fossil fuel sources by 2030.
  • India has set a target to achieve at least 500 GW (gigawatts) of non-fossil power capacity by 2030, up from its current 165 GW (2024).
  • India has also pledged to create an additional carbon sink of 2.5 to 3 billion tonnes through additional forest and tree cover by 2030.
  • India has the aim to achieve the target of net zero emissions by 2070.
  • Preliminary estimates conducted for the Paris Agreement suggest that at least US$ 2.5 trillion (at 2014-15 prices) will be required for meeting its climate change actions between 2015 and 2030 (Government of India, 2015). The financial sector can play a pivotal role in mobilising resources and their allocation in green activities/projects.

Challenges to Green financing:

  • Lack of clear definition: There is no clear-cut definition for “Green Finance” in India. Various terms such as Climate finance, sustainable finance is used interchangeably with green finance. It led to misunderstanding among stakeholders and made it problematic to keep track of capital invested in green sectors. 
  • Green Washing: Greenwashing is the practice of channelling proceeds from green finance towards projects that have negligible environmental benefits and providing misleading information to the investors and public about the environmental impacts of the company. Such practises discourage green financing. 
  • Failure to internalize externalities: Infrastructure investments in India didn’t efficiently internalise the environmental externalities (Positive externalities are benefits arisen to third parties due to green investments and negative externalities are damages inflicted on third parties due to polluting investments). This resulted in insufficient capitalization of “green” projects and excessive investment in “brown” projects.
  • Maturity mismatches: Generally green projects require long-term financing with low returns in the initial years. This results in mismatch between long-term green investment and relatively short-term interests of investors.
  • Information asymmetry: Lack of information on commercial viability of green technologies and uncertain policies on green investments resulted in risk aversion by investors in projects of renewable energies. 

Government’s Steps:

  • Sovereign green bonds: 
    • Sovereign green bonds are fixed interest-bearing financial instruments issued by any sovereign entity / inter-governmental organisation /corporation. The proceeds of these bonds are used only for environmentally conscious, climate-resilient projects.
    • The Reserve Bank of India (RBI) recently auctioned its maiden sovereign green bonds worth ₹8,000 crore under its Sovereign green bond framework.
    • There is no cap on foreign investment in these bonds because these instruments are considered as specified securities under the fully accessible route.

Green deposits: With a view to fostering and developing green finance ecosystem in the country further, RBI has put in place a Framework for acceptance of Green Deposits by the banks.

What are Green Deposits?

  • A green deposit is a fixed-term deposit for investors looking to invest their surplus cash reserves in environmentally friendly projects. Green bonds used to be the most common fixed-income ESG product in India earlier, and now products like green deposits are gaining significance.
  • Corporates looking for inclusion of a sustainability agenda into their treasury activities or those that have limited opportunities for investment in environmentally beneficial projects can invest in these green deposits.

Purpose of the framework:

To encourage banks to offer green deposits to customers, protect interest of the depositors, aid customers to achieve their sustainability agenda, address greenwashing concerns and help augment the flow of credit to green activities/projects.

Key Guidelines:

  • Applicability: The provisions of these instructions shall be applicable to Scheduled commercial banks (excluding payment banks, RRBs), deposit taking NBFCs and Housing finance companies (HFCs)
  • The Banks shall issue green deposits as cumulative/non-cumulative deposits. On maturity, the green deposits would be renewed or withdrawn at the option of the depositor. The green deposits shall be denominated in Indian Rupees only.
  • The eligible banks shall put in place a comprehensive Board-approved policy on green deposits covering all aspects in detail for the issuance and allocation of green deposits.
  • Allocation of funds: The proceeds raised form the green deposits shall be allocated to the following activities

Projects involving nuclear power generation, generating energy from biomass and hydropower plants larger than 25MW are excluded from eligible projects. 

The banks shall ensure that the funds raised through green deposits are allocated to the eligible green activities/projects.

  • Third party verification: Allocation of funds raised through green deposits shall be subject to an independent Third-Party Verification/Assurance which shall be done on an annual basis. The third-party assessment would not absolve the bank of its responsibility regarding the end-use of funds.

A review report shall be published by the banks covering the details about amount raised under green deposits, amount of funding to the eligible green projects and third-party verification report.

What are Biofuels?

Context: Private textiles manufacturers in India are looking forward to replacing coal as the raw material used in manufacturing processes with biofuel. However, this requires a reliable supply-chain of biofuel, to substitute coal.

Relevance of the Topic:  Prelims & Mains: Biofuels: Sources, Types, Advantages. 

Biofuels

  • Biofuel is any fuel that is derived from organic sources such as biomass and organic waste (plant or algae material or animal waste).
  • It is considered to be a source of renewable energy (as such feedstock material can be replenished readily), unlike fossil fuels such as petroleum, coal, and natural gas.
Biofuels

Sources of Biofuels

  • First-generation biofuels: Consists of fuels obtained from food crops (corn, wheat, soybeans, sugarcane). E.g., Biofuels created from vegetable oils, such as bioethanol and biodiesel.
  • Second-generation biofuels: Fuels that come from organic wastes (agri-food and forestry industries), used cooking oils and the organic matter from urban wastes. E.g., Renewable diesel (HVO), sustainable aviation fuel (SAF), biogas, and biomethane. 
  • Third-generation biofuels: Fuels extracted from algae and aquatic plants with a natural oil content of at least 50%. 
  • Fourth-generation biofuels: Fuel sought to be extracted from genetically modified microorganisms to improve the efficiency of CO₂ Capture and Storage.
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Types of Biofuels:

  • Bioethanol: 
    • Obtained through the fermentation of materials rich in sugars or starches, such as corn, sugar cane, sugar beet etc. This process converts the sugars present in these materials into ethanol. 
    • Bioethanol is widely used as an additive in petrol to increase octane number, and bring down carbon monoxide and other toxic emissions.
  • Biodiesel: 
    • Fuel made from vegetable oil, recycled cooking oil, soybean, palm oil, peanut oil, animal fat, and fatty acids, through a process of conversion is known as Transesterification. 
    • The energy content in Biodiesel is about 90% that of petroleum diesel. Compared to petroleum-based diesel, Biodiesel burns cleaner and eliminates sulfur dioxide emissions.
  • Bio-gas:
    • Bio-gas is a blend of gases such as methane (main component), carbon dioxide, and hydrogen sulfide. 
    • Biogas is produced from anaerobic breakdown of biomass (raw materials such as manure, green waste, food waste, agricultural waste). It burns just like natural gas. 
  • Bio-hydrogen:
    • Biohydrogen is typically produced through fermentation of organic materials such as agricultural waste or algae, bacteria, and achaea.
    • Some of the common methods of developing biohydrogen are photo fermentation, dark fermentation, direct photolysis, and indirect photolysis.
  • Aviation Biofuel:
    • Sustainable aviation fuel (SAF) is an alternative fuel to fossil-based jet fuel. SAF can be made from renewable and waste-based sources such as used cooking oil, municipal and agricultural waste.
    • It has the potential to reduce lifecycle emissions by up to 80% (when used neat) compared with conventional aviation fuel. SAF can also be blended with conventional aviation fuel. 

Advantages of Biofuels:

  • Lesser Greenhouse emissions: Biofuels emit fewer greenhouse gases compared to fossil fuels.
  • Circular Economy: Use of organic wastes for fuel production favours the reuse of resources and reduces the arrival of waste at landfills. 
  • Energy Security: Using biofuels can increase energy security by diversifying energy supply. By blending biofuels with conventional fuels, it can reduce import dependence on fossil fuels and save forex reserves. 
  • Economic Opportunity: Domestic or localised production and use of biofuels can create new jobs in a variety of industries, including agriculture, engineering, and transportation etc.
Biofuels

Limitations:

  • Food Security: Biofuel crops competing with food crops for land and water raises concerns about food security. 
  • Land Use Issues: Cultivating crops for biofuel often requires large areas of land, leading to concerns like deforestation and habitat destruction.
  • High Cost: Producing biofuels requires substantial investment in infrastructure and technology. As a result, biofuels tend to be more expensive than traditional fossil fuels, limiting access for consumers.
  • Unintended consequences: Biofuels production sourced from previously forested land or converted land can release carbon stored in soil and vegetation.
  • Supply-chain limitations: Limited-supply chains in India limits the scalability of biofuels. 

Government Initiatives for Biofuel Production

  • National Policy on Biofuels (2018): 
    • The National Policy on Biofuels - 2018 was notified by the Ministry of Petroleum and Natural Gas to promote the production of biofuels. 
    • The policy was amended in 2022 to advance the target of 20% blending of ethanol in petrol to 2025-26 from 2030. 
  • PM JI-VAN Yojana:
    • In 2019, the Government launched Pradhan Mantri JI-VAN (Jaiv Indhan- Vatavaran Anukool fasal awashesh Nivaran) Yojana.
    • Aim: To provide financial support to integrated bio-ethanol projects for setting up Second Generation (2G) ethanol projects using ligno-cellulosic biomass and other renewable feedstocks. 

The diverse range of biofuels offers promising alternatives to traditional fossil fuels. Their renewable nature reduces carbon footprint, and their potential for sustainable energy makes them pivotal in our transition towards a clean environment.

World Solar Report 2024

Context: The World Solar Report 2024 by the International Solar Alliance (ISA) was released in November. 

Relevance of the Topic Prelims: Key understanding of broad trends in the Solar Energy Sector; International Solar Alliance. 

Major Highlights of the Report:

  • Surge in global solar capacity: Solar capacity represents three-quarters of all renewable capacity additions worldwide. From 1.22 GW in 2000, the world’s solar capacity has surged to 1,419 GW in 2023. 
  • Increasing Investments: The report highlights the global shift toward sustainable energy, with energy investments rising from $2.4 trillion in 2018 to $3.1 trillion by 2024. 
  • Increased Installed capacity: As of 2023, China dominates solar PV as 43% (609 GW) of the cumulative capacity of solar panels installed globally is from China. The U.S. contributes 10% (137.73 GW). Japan, Germany, and India each captured a 5-6% share. 
  • Solar Manufacturing: Solar PV manufacturing has nearly doubled in capacity for wafers, cells, and modules in 2023. China maintained the highest share in component manufacturing in 2023, with 97% in wafers, 89% in cells, and 83% in module installation capacity.
  • Employment generation: Employment in the solar PV sector rose to 7.1 million jobs in 2023, up from 4.9 million in 2022 worldwide.
  • Advancement in Solar Technology: There is 24.9% efficiency in solar PV modules, an 88% reduction in silicon usage since 2004, and a 90% drop in utility-scale solar PV costs, fostering resilient, cost-effective energy solutions.

New Solar Technologies:

  • Quantum dot solar cells have achieved an efficiency of 18.1%, offering a promising approach to enhance solar energy capture and power atmospheric water harvesting technologies. 
  • Self-healing solar panels (presently under development) to extend the lifespan and reduce the maintenance of existing solar cell technologies. 
  • Solar-powered phyto-mining uses solar energy to power the extraction of valuable metals from soil-using plants, offering a sustainable alternative to traditional mining practices.
  • Solar paver blocks integrated with building infrastructure and BIPV (Building Integrated PV), like transparent solar panels, allow light transmission and visibility. 
  • The solar sector is also prioritising recycling panels and implementing circular economy practices to minimise environmental impact.
New Solar Technologies:

About  International Solar Alliance: 

  • The International Solar Alliance was launched at the United Nations Climate Change Conference in Paris in 2015 by India and France, and came into force in 2017.
  • Aim: Global deployment of over 1,000 GW of solar generation capacity and mobilisation of investment of over US$ 1000 billion into solar energy by 2030.
  • It seeks to bring together the countries which lie either completely or partly between the Tropic of Cancer and the Tropic of Capricorn for harnessing solar energy. 
  • The membership of the ISA has now been extended to UN member countries as well (presently 120+ members). 
  • Initiatives by ISA: 
    • Global Solar Facility (GSF): A fund formed by ISA to stimulate investments into solar power projects. 
    • One Sun One World One Grid: OSOWOG envisions building and scaling a transnational electricity grid to share solar energy across the globe, leveraging the differences of time zones, seasons, resources, and prices between countries and regions.
  • Secretariat: Gurugram, Haryana, India.  

Global Solar Facility

Context: The International Solar Alliance (ISA) will launch a $100 million fund, Global Solar Facility, that will help catalysing up to $1.5 billion in funding to expand decentralised solar power capacities across the least developed countries in Africa, where more than 700 million people have no access to electricity.

About Global Solar Facility (GSF)

  • It is a payment guarantee mechanism created by International Solar Alliance (ISA) to stimulate investments in solar power projects.
  • It aims to catalyse solar investments across the world, starting with Africa’s underserved segments and geographies, thereby unlocking commercial capital.
  • It will primarily focus on decentralised solar solutions, rooftop solar, and productive use solar.
    • Through this financing vehicle, which includes payment guarantees, insurance and investment funds, the ISA aims to mitigate project risks, provide technical assistance to address regulatory gaps, reduce currency risks, resolve contractual and financial uncertainties in the solar energy sector. 
  • In 2022, the ISA Assembly approved the creation of a Global Solar Facility (GSF) in Africa, which was announced at COP27 in Sharm-el-Sheikh.
  • After Africa, the GSF aims to expand to regions such as Asia, Latin America and the Middle East, where the Regional Facilities will be tailored to meet specific requirements. 
  • In future, the GSF will invest in innovative technologies to enhance solar energy efficiency, support startups for faster solar energy implementation, and explore emerging solar energy sectors. 

Draft guidelines for Tariff based competitive bidding for procurement of storage capacity/stored energy from pumped storage plant

Contexts: Ministry of Power has released draft guidelines for Tariff based competitive bidding for procurement of storage capacity/stored energy from pumped storage plants. The draft proposes a single stage two-part bidding process, consisting of technical and financial bidding stages for procuring storage capacity from pumped storage projects.

Two modes of Procuring Pumped Storage Projects (PSPs) 

According to the draft, government proposes two modes of procuring storage capacity from pumped storage projects. They are:

  1. PSPs located on pre-specified sites by government: In this mode, procurer can choose to locate the PSP project at a site pre-specified in the bidding document. In case the site belongs to government or a government entity, the development shall be on a Build Own Operate Transfer (BOOT) basis for 25-40 years.
  2. PSPs located on a self-identified site by the bidder: Supply will be from PSP developed on a site self-identified by the bidder or from an existing commissioned PSP. In this case, the development may be on a Finance Own Operate (FOO) basis for a period of 15-25 years.

Pumped Storage Project

  • Pumped storage plants use the principle of gravity to generate electricity using water that has been previously pumped from a lower source to an upper reservoir. 
  • Operation of pumped storage power plants requires two reservoirs viz. upper and lower reservoir. Water in upper reservoir is used for generating power during peak demand hours. The water in the lower reservoir is pumped back to the upper reservoir during the off-peak hours and the cycle continues. 
  • Pumped storage plants are of two types: ‘open loop’, which has an associated natural-water source (like a river) for one or both the reservoirs; and ‘closed loop’ (or off-river PSH), which does not have a connected natural-water source and the same water is cycled between the two reservoirs for pumping and generation.
  • Energy storage capacity of a pumped hydro facility depends on size of its two reservoirs and the head between reservoirs, while the amount of power generated is linked to the size of turbine.

Need for Pumped Storage Hydropower Project

  • Renewable energy sources like solar & wind energy are intermittent and variable in nature due to factors like time, climate, season and location. They are not available 24X7. 
  • This leads to challenges of grid-stability and temporal considerations in power availability. This requires immediate ramp-up & back down of generation for grid balancing & stability of grid frequency.
  • Energy storage systems address this issue by storing excess energy and supplying it later when there is demand leading to improved grid stability, peak shifting and enhancing renewable energy integration.
  • Pump Storage Technology is the only long term technically proven, cost-effective, highly efficient & operationally flexible way of energy storage on a large scale & available at short notice.
  • Currently, it is the largest energy storage system making it most effective for Renewable Energy Integration. 
  • Benefits of Pumped Storage Projects are:
    • Peak shaving: PSPs absorb off peak energy in the system.
    • Load balancing (Peak/off-peak balancing support): Provides peaking power. 
    • Helps in system stability.
    • Increases capacity utilisation of thermal plants.
    • Spinning reserve at almost no cost to the system
    • Black start capability
    • Fast ramp up & ramp down of generation
    • Large energy storage capacity
    • Long life of operation.
    • Energy conversion rates for pump-storage projects often exceeds 80%
    • Only PSP can meet most of the grid scale energy storage needs and no other storage system can and therefore almost 95% of the storage projects are Pump hydro

Challenges with Renewable Energy

What is India's stance regarding renewable energy?

  • India is the world's third-largest consumer of energy. 
  • According to the Renewables 2022 Global Status Report, India ranks fourth globally in installed renewable energy capacity, fourth in wind power capacity, and fourth in solar power capacity. 
  • India has already met its goal of achieving 40% of installed electric capacity from non-fossil fuel sources.

Targets

  • India has set a new target of 500 GW of non-fossil fuel-based energy by 2030, which is the largest expansion plan for renewable energy in the world. 
  • Additionally, India has committed to achieving net-zero emissions by 2070. 
  • However, India has not committed to phasing out coal due to priorities such as poverty reduction and economic growth.

India has taken several steps to promote renewable energy:

  • National Green Hydrogen Mission focuses on employment, import substitution, and R&D in renewable energy.
  • PM KUSUM scheme ensures energy security for farmers and increases non-fossil fuel power capacity to 40% by 2030.
  • India allows up to 100% Foreign Direct Investment in renewable energy projects.
  • Production Linked Incentive (PLI) scheme aims to enhance India's manufacturing and exports in the solar sector.
  • Green Energy Corridors establish transmission systems for renewable energy projects.
  • The International Solar Alliance aims to deploy solar energy solutions globally.
  • Green carbon credits are proposed to create carbon sinks through public participation.

Despite these efforts, India faces challenges in increasing renewable energy:

  • High Costs and Storage Challenges Hinder Solar Power Expansion: The coal-based power plants require an initial investment of about Rs. 4 crores per MW, while in solar power plants with a capacity of 15% requirement is Rs. 18 crores in investments. Thus due to the high cost, many opt for investment in coal-based power plants.
  • Low Investment:  High transmission and distribution (T&D) losses, which have plagued discoms for decades, prevent them from making decisive investments to support renewable energy, keeping them locked into existing fleet of coal-fired power plants. Further questions around the costs and frictions associated with coal mining, transportation livelihoods, and rehabilitation of those affected need to be addressed which make transition less painful.
  • Weather Dependency: Renewable energy sources such as solar, wind, and tidal power depend on specific weather conditions. If favourable weather is unavailable, these sources can become inefficient and not feasible.
  • Land Acquisition: Most renewable energy plants require large areas of land, which introduces issues related to the cost of acquiring such vast tracts and other land acquisition challenges. Additionally, the distance between the renewable energy source and the grid increases both the cost and the efficiency challenges of renewable energy.
  • Environmental Problems: The turbines contribute to noise pollution and have also been responsible for bird fatalities during operation.
  • Dependence on Solar Panels: India has heavily relied on importing solar cells and modules, mainly from China and Vietnam, to meet its solar energy requirements.

Way Forward

  • Large-scale renewable energy development can avoid reproducing the injustices of past large-scale infrastructure projects, while being sensitive to developmental objectives.
  • Experimenting with ownership models is one approach. The parks need not necessarily be owned by the state or private companies. Community initiatives could help generate revenues for the communities, further promoting small businesses and upskilling, improving incomes, stimulating local economies, and improving energy access. 
  • Solar and wind park development is exempted from Environmental and Social Impact Assessment. The legal and regulatory architecture must be revised and strengthened to limit adverse social and environmental consequences. 
  • In terms of impacts on small and medium landowners where private land is being used, there is no mechanism to monitor if a fair price is paid to those leasing their land. Involving local governance units in the planning and siting processes can provide an opportunity to align local developmental objectives with solar park development. 
  • Wasteland classification needs a significant overhaul. Recognition of commons under the FRA would help improve environmental and equity outcomes by granting land ownership to communities dependent on commons. If such land is to be leased or acquired for solar parks, solar park development corporations will have to engage with local governance units such as the Gram Sabha to initiate the project. 
  • Encouraging research and experimenting with ‘agrivoltaics’ is another way to think about sustainably developing renewable energy. Agrivoltaics pair solar with agriculture, creating energy and providing space for crops, grazing, and native habitats under and between panels. Thus, farmers can grow crops while also being ‘prosumers’ — producers and consumers — of energy.
  • Large-scale renewable energy projects could have positive employment outcomes at the district level, but they lead to massive employment shifts between sectors at the national level. Adequate skilling and training programmes targeting the unskilled and poorer populations are essential to protect them. 

Conclusion

  • We are at the cusp of a second green revolution, this time involving energy. We have an opportunity to anticipate the unintended consequences of this revolution, and align our technological, economic, and institutional structures to maximise synergies between sustainability, climate change mitigation, and development related outcomes.

India's largest solar battery project

Context: Solar Energy Corporation of India (SECI) has commissioned India's largest Battery Energy Storage System (BESS) project in Rajnandgaon, Chhattisgarh.

About the project

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  • The Solar Battery Project is a 40 MW/120 MWh Battery Energy Storage System with an installed capacity of 152.35-megawatt hour and a dispatchable capacity of 100 MW AC.
  • The project has deployed bifacial modules which reflect the light from the ground. This helps in generating more electricity than monofacial modules. 
  • The energy generated from the plant would be purchased by the state of Chhattisgarh for meeting the peak energy demand of the state using green electrons and towards its renewable purchase obligations.
  • The project will ensure overall power stability and reliability by ensuring an efficient evacuation of power.
  • Funding of the project: This project has been financed by the Clean Technology Fund of the World Bank and other long-term finances.

Need for battery storage of solar energy

  • One of the limitations of Solar energy is that it produced only in the daytime. This problem could be addressed by storing solar energy into battery systems. 
  • The energy used in the battery systems can be used later when there is peak demand (often in the evenings).
image 67

Bifacial solar modules

  • Bifacial solar modules produce solar power from both sides of the panel. In contract, monofacial solar cells produces electric energy only when photons impinge on their front side.
  • Bifacial solar cells can make use of albedo radiation from the bottom and using diffused sunlight to be used.
  • Bifacial solar cells come with advantages such as higher energy output and lower installation costs. 
  • Bifacial solar cells have greater durability as both sides are resistant to ultra-violet light and potential-induced degradation is also reduced when the bifacial module is frameless.

Clean Technology Fund

  • Clean Technology Fund provides large-scale financial resource for investing in clean technology projects in low and middle-income countries.
  • They contribute to the demonstration, deployment and transfer of low-carbon technologies with significant potential for reducing long-term greenhouse gas emissions.
  • This is a fund under Climate Investment Fund.
  • Clean Investment Fund has also established Clean Technology Fund Parallel Fund (CTFPF) which has been established in 2022. This is a parallel and associated fund of the CTF. This fund is used to accept new loan contributions in support of CTF activities in accordance with allocations made by CTF Trust Fund Committee.

Climate Investment Funds (CIF)

  • CIF is one of the largest multilateral climate funds in the world to mobilise finance for low-carbon, climate-resilient development at scale in developing countries. 
  • Climate Investment Fund comprises of two funds – (i) Clean Technology Fund (ii) Strategic Climate Fund.
  • Funds under Strategic Climate Fund are:
    • Pilot Program for Climate Resilient (PPCR)
    • Scaling Up Renewable Energy Program in Low Income Countries (SREP)
    • Forest Investment Program
    • Global Climate Action Programs 

Viability Gap Funding for Offshore Wind Energy

Context: The Union Cabinet approved India's first offshore wind energy projects with a capacity of 1 GW (500 MW each) off the coast of Gujarat and Tamil Nadu, at a total cost of Rs 7,453 crore.

image 14

Offshore Wind Energy

  • Offshore wind energy is clean and renewable energy obtained by taking advantage of the force of the wind produced on the high seas. 
  • Wind reaches a higher and more constant speed on the high seas as compared to that on land due to the absence of barriers. 
  • In order to make the most of this resource, mega-structures are installed that are seated on the seabed and equipped with the latest technical innovations.
  • According to studies conducted by NIWE, there is good potential for development of offshore wind power off the Southern tip of India and off the West Coast for development of wind power in India’s coastline.
image 15
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Benefits of Offshore Wind Energy

  • Renewable, unlimited and non-polluting.
  • Offshore wind energy turbines are much larger in size (5-10 MW per turbine) as against 2-3 MW of an onshore wind turbine.
  • Reduces pressure on land resources.
  • Barrier-free regions thus higher wind speed and efficiency
  • Visual and acoustic impact is small
  • No issues of land acquisition.
  • Ease of maritime transport, which has few limitations about cargo and dimensions in comparison with land transportation, has made it possible for offshore wind turbines to reach much larger unit capacities and sizes than onshore wind turbines.

Challenges of Offshore Wind Energy

  • The major issue lies in the challenges about high costs and technological challenges of offshore wind facilities owing to underwater construction constraints. Thus, making the per mega­watt cost of offshore wind turbines higher than the cost of onshore wind turbines.
  • Construction and operations may disturb the delicate ecological landscape, which in turn may affect species and biodiversity. For ex. Identified area for project like Gulf of Khambhat is an ecologically sensitive zone. 

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Global Standings

  • As of 2023, China continues to be the global leader in offshore wind energy capacity followed by the United Kingdom and Germany.
image 17

India and offshore wind energy

  • India has a coastline of about 7600 km surrounded by water on three sides and has good prospects of harnessing offshore wind energy. 
  • Ministry of New and Renewable Energy (MNRE) is the nodal Ministry for the development of Offshore Wind Energy in India.
  • MNRE has notified the ‘Offshore Wind Energy Policy’ in 2015 which provides a framework for the development of offshore wind power development up to a distance of 200 nautical miles from the baseline i.e., up to the country's Exclusive Economic Zone. 
  • National Institute of Wind Energy (NIWE), Chennai is the nodal agency to carry out resource assessment; surveys and studies in EEZ demarcate blocks and facilitate developers for setting up offshore wind energy farms.
  • For the initial phase of developments, potential offshore wind zones off the coast of Gujarat and Tamil Nadu have been identified through meso-scale study.
  • A revised Strategy for the development of offshore wind energy projects has been issued in 2023. Further, The “Offshore Wind Energy Lease Rules, 2023” to regulate the allocation of offshore wind sea blocks to developers have been notified.
  • India has set a target of installing 30 GW of offshore wind projects by 2030.  The government estimates that the states of Gujarat and Tamil Nadu alone have around 70 GW of potential for offshore wind power.
  • While India’s onshore wind energy capacity has reached 42.633 GW (4th highest in the world), offshore wind energy in the country is yet to gain momentum.
  • Approved in June 2024, the Viability Gap Funding (VGF) scheme for offshore wind energy projects includes an outlay of Rs.6853 crore for installation and commissioning of 1 GW of offshore wind energy projects, and grant of Rs.600 crore for upgradation of two ports to meet logistics requirements for offshore wind energy projects.
  • The VGF scheme is a step towards implementation of the National Offshore Wind Energy Policy notified in 2015 with an aim to exploit the vast offshore wind energy potential that exists within the exclusive economic zone of India. 
  • The successful commissioning of 1 GW offshore wind projects will produce renewable electricity of about 3.72 billion units annually, which will result in annual reduction of 2.98 million tons of CO2 equivalent emission for a period of 25 years.

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