India has moved past the US and climbed up a position to clinch the second spot in the recent list of ‘Renewable Energy Country Attractiveness Index’ released by Ernst and Young. The underlying reason for the surge has been the ongoing strong support from the Indian government and the increasingly attractive economic condition from the perspective of renewable energy.
The Indian government has a strong program which aims at building 175GW of renewable energy in the country by 2022 and have renewable energy account for 40% of capacity of energy production in India by 2040. As a result of the push, from its low base capacity of 2.6 GW in 2014, India has now added over 500% of solar capacity (~10MW) over the last three years.
However, the cost and availability of energy storage technology could dictate how close India gets to achieving these targets. The rapid increase in volume of renewables could threaten the thermal power plant economy which currently dominates the Indian market, thus destabilizing the entire system. The EY Renewable Energy Attractiveness Index report also noted the need to increase compliance with the Renewable Purchase Obligation (RPO). The government could also ease rules around taking a foreign debt to ease the pressure on the financially distressed distribution companies.
The report identifies the rollback on past administration’s climate changes policies and the decision to revive coal industry as key reasons of drop in the ranking for US in the index. Both India and China, which currently holds the pole position, have surpassed USA, which has lost rankings for the first time since 2015. As the renewable energy alternatives become viable, more countries are coming up to support a clean energy future and the trend will keep getting better over the time.
Date: 24-05-2017 | Source: Energy World: The Economic Times