India Encourages Companies to Go Green

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India is setting rules that will make it easier for companies to switch entirely to renewable power, which is a key step toward decarbonizing the nation’s fossil fuel-dominated economy. The new regulations will allow companies to purchase renewable electricity from state distributors at weighted average prices, called “green tariffs,” Power Minister Raj Kumar Singh said at the virtual BloombergNEF summit.

Accelerating use of clean energy in offices and factories, the largest power consuming segment in the country, will be key to achieving targets to cut emissions per unit of the GDP. It will also help the companies improve their environment, social and governance or ESG scores by reducing their carbon footprint.

In an effort to ease the situation, those opting for green power will be allowed open access when they aren’t tied down to the local distributor within 15 days, instead of having to wait for months, Singh said. That would force state utilities to either meet the demand or risk losing their high-value customers.

Companies those opting for green power will be allowed open access when they aren’t tied down to the local distributor within 15 days, instead of having to wait for months, Singh said. That would force state utilities to either meet the demand or risk losing their high-value customers.

“High open-access charges can often create barriers for consumers to directly access green power,” Mishra said. “And as per law, that’s under the jurisdiction of state electricity regulators who would want to balance the interest of the incumbent utility.” The power ministry has proposed changes in the electricity laws to remove entry barriers in electricity distribution, and Singh expects to see parliament’s approval for the amendments soon, he said.

India will promote offshore wind projects to get to its 2030 goal of 450 gigawatts of renewables capacity, a near fivefold expansion from current levels. That would include 280 gigawatts of solar and 140 gigawatts of wind capacity, the minister said.

India will fall short of its renewable capacity goal of 175 gigawatts by the next year due to “some hiccups,” Singh said, potentially linked to the pandemic. The country has had to extend deadlines for renewable projects due to difficulties in importing equipment and getting workers at construction sites during lockdowns.

Source: BloombergNEF

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