India Must Expand Renewable Integration to Meet 2030 Emissions Intensity Target

India's renewable energy capacity has grown faster than its ability to absorb clean power into the grid, with the share of renewables in total electricity generation rising by only 6.5 percentage points between 2016 and 2022 despite renewables accounting for a much larger share of new capacity additions over the same period, according to a new IEEFA report. The analysis identifies four levers India must deploy to meet its commitment to reduce the emissions intensity of its GDP by 45% below 2005 levels by 2030.

The four recommended integration levers are: time-of-use electricity tariffs to shift consumption patterns; a well-connected national grid to balance uneven geographic distribution of renewable resources; energy storage systems to provide grid balancing services beyond simple renewable supply firming; and flexible operation of existing coal and gas power plants. India has committed Rs2.4 trillion (approximately US$29.6 billion) to transmission infrastructure development to integrate over 500 gigawatts of renewable energy capacity by 2030, placing it on the right path for grid expansion. Studies show dynamic time-of-use pricing can reduce peak demand by 5% to 25%.

Pumped hydro storage and battery energy storage systems are identified as the most promising storage technologies for India at present. IEEFA recommends broadening the scope of energy storage applications beyond simply firming renewable supply to include a full range of ancillary grid balancing services, which would improve overall grid flexibility and resilience and enable a higher penetration of variable renewable energy. A well-developed ancillary services market is identified as a prerequisite for this expanded role.

On flexible coal operation, the report notes that while Indian coal power plants currently operate at a minimum load of around 40% after modernisation, technical studies suggest this could theoretically be reduced to 10% with further upgrades. Converting coal plants to flexible operation would allow them to reduce output when renewable generation is high, cutting renewable curtailment and improving economics for both coal and clean energy in the merit order dispatch system. A renewable-rich grid would also enable decarbonisation of other sectors including transportation and manufacturing, multiplying the climate benefits of India's energy transition.

Key figure — 6.5 percentage points — growth in renewable energy's share of India's total electricity generation between 2016 and 2022, against a 13.6-point share of new capacity additions