Introduction

India must peak its emissions from its high-polluting power sector by 2026 to align with the Paris Agreement and achieve net zero emissions by 2050, according to Bloomberg NEF's recent New Energy Outlook for India. However, this target is increasingly unlikely to be met due to the Indian government’s ongoing support for coal power.

It also mentions that net zero before the target date of 2070 would involve an investment of roughly $12.4 trillion to expedite technologies such as clean energy, carbon capture, and green hydrogen and bring about large-scale adoption of electric vehicles. These investments will be important for the transition of the Indian economy away from coal dependency.

The country is rapidly expanding its renewable sources of energy, but coal accounts for the propulsion of about 75% of the country's electricity. This is despite there being over 100 gigawatts of renewable energy capacity added within the last ten years. In forecasts by Bloomberg NEF, coal is expected to remain a major source of energy, with its share of primary energy demand falling from 77% in 2023 to about 50% by 2050.

Recent developments have complicated the road to meet the target of 2026 as an emission peak. In this line, the government of India has announced new projects of coal power and postponed the phase-out of old, polluting facilities until 2030, while referring to coal as a factor in energy security until other alternatives will be economically viable to replace it.

"It seemed evident till couple of years ago that the emissions of India's power sector will peak around 2026, but government's fresh push for coal power has delayed that target," said Sunil Dahiya, an analyst with New Delhibased Centre for Research on Energy and Clean Air. He further added that despite this setback, he still remained cautiously optimistic that emissions might peak before 2030.

In fact, meeting India's target of 500 GW of clean power capacity by 2030 would require steep ramps-up in annual low-carbon energy deployment activity-more than 40 GW per year, three times the average annual additions of the past five years.

The country's increasing dependence on fossil fuels, unsustainable in nature and highly expensive, resulting in an import bill of $262 billion, said Federal Road Transport Minister Nitin Gadkari. In his address Tuesday at the BloombergNEF summit in New Delhi, Gadkari called upon vehicle makers to come up with alternative fuel technologies in order to contribute to decreasing carbon emissions from the transport sector. This sector is blamed for 12% of energy-related emissions and much of the severe urban pollution.

The BloombergNEF report projects two scenarios of India's energy transition: an ambitious scenario when India reaches net zero twenty years in advance of the target set for 2070, while on the other extreme, it provides a more conservative 'economic transition scenario' focused only on cost-effective solutions. The less ambitious scenario would only peak coal use in 2038, while unabated coal burning accounted for a full 20% of power generation in 2050. In this base case, the emissions remain high across the century, with electricity generation only tripling from its 2023 level.

"It's therefore imperative that India ups its climate ambition, comes out with a road map for deep decarbonization of the economy, and declares target years to achieve peak emissions from various sectors," said Shantanu Jaiswal, BNEF's head of research in India.

As the world's third-biggest emitter, what India does over the next several years will be crucial to whether it can achieve its climate objectives and do its part in the global effort to cap temperature increases.