3 min readNew DelhiSep 8, 2021 03:05 AM IST
First published on: Sep 8, 2021 at 03:05 AM IST
INDIA DOES not require additional new coal capacity to meet expected demand growth by financial year 2030, according to a report prepared by EMBER, an independent British energy think-tank, in collaboration with Bangalore-based Climate Risk Horizons.
According to the report, which was released on Tuesday, even if India’s power demand grows 5 per cent annually, in line with the most optimistic International Energy Agency projection, coal-fired generation in the financial year 2030 will be lower than in the financial year 2020, as long as India achieves its non-coal generation targets – its renewable energy targets.
“In effect, more coal capacity beyond what’s already under construction isn’t needed to meet the aggregate demand growth by FY 2030,” says the report, adding that the development of new coal plants will lead to “zombie” units – ones which will exist, but not be operational.
India’s peak demand would reach 301 GW by 2030, if it grows at an annual growth rate of 5 per cent, which is also in lines with projections made by the Central Electricity Authority. “If this peak occurs during sunlight hours as recent studies predict, India’s planned solar capacity can cover much of it. Even if it occurs in the evening, substituting the ‘zombie’ coal plants with additional battery storage capacity represents a more flexible, cheaper option,” says the report.
The report also finds that India can free up Rs 247,421 crore by “killing” the zombie coal projects, as these surplus plants, if built, will require an estimated Rs 247,421 crore investment.
“They will lock consumers into expensive contracts and jeopardise India’s RE [renewable energy] goals by adding to the system’s overcapacity,” it says, adding that India can make annual savings of Rs 43,219 crore by investing in renewables and storage.
“As India recovers from the disruption caused by the Covid-19 pandemic, how the country uses scarce public resources will be absolutely crucial. By avoiding these unnecessary ‘zombie’ coal plants, India can not only save lakhs of crores of rupees, but also lower power costs and reiterate its commitment to the success of its clean energy transition goals,” says Ember’s senior analyst Aditya Lolla.
“Once incurred, these wasted investments will lock DISCOMs and consumers into expensive contracts and jeopardise India’s RE goals by adding to the system’s overcapacity. The smart option is to divert these resources to renewables and storage to build a cheaper, more resilient grid for the future,” says Abhishek Raj of Climate Risk Horizons.
According to the analysis, the private sector investment on “zombie” coal plants will be Rs 62,912 crore.
The report also finds that India can free up Rs 247,421 crore by “killing” the zombie coal projects, as these surplus plants, if built, will require an estimated Rs 247,421 crore investment. 
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