The government is working to increase the percentage of renewable energy sources within its energy mix. It has targets for 23% in 2025 and 31% in 2050. In addition, the country's petroleum energy mix is predicted to decline by around 20% by 2050. In the last decade, the country has experienced an increase in energy consumption. But, the country's demand for energy is increasing and fossil energy production cannot meet it. This has led to an increase in import petroleum. These concerns have been addressed by the government who has introduced a series of policies that encourage national use of renewable energy sources.
India's ambitious re targets
India's ambitious RE targets point to a positive future for the sector. Numerous long-term investors have been attracted to India, including sovereign entities as well as global private equity firms and major oil and gas companies. This sector has experienced a tremendous rise in global investor interest over the past few years. India's opportunities in RE are immense if they are implemented well.
The Government of India (GOI) has established ambitious RE targets by 2030. This includes a goal of 450 megawatts of capacity. By then, the majority of RE capacity in India will likely come from wind solar hybrids. To achieve this ambitious target, India will need support policies and innovative technologies. The fastest-growing segment in India's solar market is rooftop solar plus storage. This market has the lowest cost per kWh worldwide.
Costs for achieving retargets
The Southern African Development Community (SADC) is a region in the world that has ambitious targets for renewable energy. The region has ambitious targets to reach full energy access by 2040 and a 53% share in renewable energy capacity. It hopes to reach these targets with investment of nearly $53 billion. But, there have been problems along its way. The COVID-19 outbreak, which seriously impacted the sector, was one of them. The pandemic caused lockdowns which disrupted the entire value chain of electricity. This led to delays in RE project design, as well import restrictions and equipment procurement logistics. These delays also prevented SADC to fully benefit from policy initiatives that encourage private-sector engagement.
Impact of re targets on economic growth
Many jurisdictions have adopted RETs to increase the share of renewable energy in total energy production. These targets aim at accelerating the expansion of renewables as well as addressing climate change promptly. However, achieving these targets will require unprecedented changes in the energy system. While RETs can be useful as a policy tool, they also have significant practical drawbacks.
First of all, targets create psychological pressures to act quickly. This could lead to decision-makers losing sight on the essential objectives. For instance, the Renewable Energy Directive threatens to increase net carbon emissions and deforestation. This could lead you to making unwise trade-offs.
Impact of re targets on carbon emissions
To reduce carbon emissions, Retargets were established. These targets come with some limitations. For one, the carbon efficiency of a region differs from another. China, for example has an eastern region with the highest carbon emissions efficiency. While the western region has low carbon emissions, it is the most efficient. As such, the effectiveness of retargets is not yet proven.
This has made it imperative that we balance economic growth with ecological management. A key criterion to a sustainable and ecologically-friendly economy is increasing carbon efficiency. The development of renewable energy resources can help achieve this objective and provide a solid base for decision making.