Solar energy cost to fall to INR 1.9 per unit by 2030 in India
New Delhi, Feb. 13 (IANS): The cost of generating solar energy in India is set to fall to as low as INR 1.9 per unit by 2030 with technological advancements increasing efficiency, a joint study by TERI and Climate Policy Initiative (CPI) revealed on Wednesday.
“By 2030, we project that the cost of wind and solar will be between INR 2.3-2.6 per kilowatt hour (kWh) and INR 1.9-2.3 per kWh respectively, while the cost of storage will have fallen by about 70 per cent,” the report launched at the World Sustainable Development Summit 2019 here said.
The report titled ‘Accelerating India’s transition to Renewables: Results from the ETC India Project’ suggests that by 2030, solar electricity could be as cheap as INR 2.3 per kWh and even cheaper solar costs are possible, in the order of INR 1.90 per kWh, if the widespread deployment of tracking technology raises the capacity utilization factor of new plants above current levels. Likewise for wind, with mast heights increasing from the current level of 80 metres to 100 and even 120 metres, baseline projection for 2030 for the levelized costs of wind at INR 2.58 per kWh could be as low as INR 2.26 for projects with higher capacity utilization factors.
“We knew that renewables were cheap in India, but there were concerns that balancing their intermittency would raise consumer costs. This need not be the case: a high renewables system is cost-effective,” Dr Ajay Mathur, Director General of The Energy and Resources Institute (TERI), said.
According to the findings, the required investments in electricity generation capacities are substantial, at about INR 1.65-1.75 lakh crore per year. This is slightly above the rate achieved over the last 10 years, which was around INR 1.40-1.50 lakh crore per year, and represents a substantial financing challenge given the current stresses on the Indian banking system. In contrast to the falling prices of solar and wind energy, the study has found that new non-pithead coal could be as expensive as INR 6.98 per kWh by 2030, while cheaper pithead coal would be INR 4.85 per kWh by 2030.
“We project the tariffs of new coal-fired electricity to rise, due to increases in coal transportation costs and increases in coal plant capital costs to improve efficiencies and reduce local pollution,” the report said.
The Energy Transitions India (ETC India) report estimates the total share of all zero-carbon technologies in generation, including large hydro and nuclear, to reach 45 per cent. “This represents rapid decarbonization of Indian power production,” it said. TERI also released a book on the occasion, ‘Green, Reliable and Viable: India’s Shift Towards Low-Carbon Energy’ on Energy Transitions in India, which brings together perspectives from key stakeholders from the power, mobility, agriculture and energy efficiency sectors, amongst others, offers their views on the challenges that lie ahead, and the solutions and next steps to move India forward on the decarbonisation pathway.