Shifting gears in India's energy transition

With a few more bold policy shifts, especially on enabling supply and demand flexibility, and digital innovation paving the way, we are in for an exciting journey

- SUMANT SINHA

INDIA CROSSED A milestone in June—50% of its electricity generation capacity now comes from non-carbon-emitting sources, a testament to the Prime Minister's clean growth vision. This marks a celebratory moment in India's energy transition journey. But the transition is a long road trip requiring frequent gear shifts to adapt to changing terrain. India must now navigate rising demand, supply volatility, and evolving market dynamics to replace its fossil-fuel-based system with a clean, flexible, and inclusive energy ecosystem.

Electricity demand has surged over 20% in the last three years, and nearly doubled in the past 12 years. Peak demand now occurs in May and September, driven by heatwaves and post-monsoon industrial activity. Daily peaks have shifted too, around 3 pm and 9:30 pm, compared to 11 am and 7 pm in 2010.

With residential and commercial sectors making up 45% demand, electricity use fluctuates sharply due to weather-sensitive appliances like air conditioners (ACs) and geysers. Northern states have increased their consumption share, while western ones have declined. In sum, India is experiencing a significant rise and volatility in electricity demand, along with changes in when and where.

On the supply side, clean energy sources like solar and wind are inherently variable and time-bound. They meet 25% of afternoon demand and only 10–12% of evening demand, while on the rise. Solutions like round-the-clock renewable energy, delivered through a combination of solar, wind, hydro, and storage, are gaining ground, but more capacity is needed to meet a larger share of electricity demand.