Energy and Power industry is the backbone of the industrial world, supplying essential energy to industrial, manufacturing, commercial, and residential sectors. The growth of the energy and power industry is driven by the expansion of power bases to meet growing demand from electricity-starved regions. Further, large investment and the wide number of projects in the country have boosted the market growth. India is the third-largest producer of electricity in the world with a generation of 1,561 terawatt-hours (TWh) as per the key world energy statistics published by Energy Association in 2019. During April-December 2019, electricity production reached 950.40 billion units. Further, Government support for initiatives ‘Clean India’ has also supported the energy and power industry growth.
A Full Report of Energy and Power Industry is Available at: https://marketinsight.in/industry-reports/indian-energy-and-power-sector
The Goal of the Government of India
India ranked sixth in a list of countries to make the most investment in clean energy at $90 billion in 2018. Primary energy sources are coal, natural gas, nuclear, Renewable (Hydro, Solar, Wind, Etc.), biofuels and waste, and oil. Renewable energy is the fastest-growing source of energy in India. The government has set the target to achieve 175 GW (gigawatt) installed capacity of renewable energy by FY 2022. As of June 2019, the government gas passed $5 billion of transmission-line tenders in phases and has set a target of 175 GW by 2022. As of January 2020, total thermal installed capacity in the country stood at 230.18 GW, while renewable, hydro, and nuclear energy installed capacity totaled to 86.32 GW, 45.39 GW, and 6.78 GW, respectively. The government has planned to double the wind power generation capacity to 60 GW by 2022.
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Key Aspects to Drive the Energy and Power Industry
- Energy demand: Continues growth in population and increasing per capita energy usage to increase the demand
- Attractive Opportunities: Focus on renewable energy supported by policies and investment to create enormous opportunities.
- Policy support: Government initiatives such as Deen Dayal Upadhyaya Gram Jyoti Yojana (DDUGJY), Ujwal DISCOM Assurance Yojana (UDAY), and Integrated Power Development Scheme (IPD) to support the market growth.
- High investment: Total Foreign Direct Investment in the power sector reached $ 14.65 billion from April 2000 to September 2019, accounting for 3% of total FDI inflows in India. The Union Budget 2020-2021 has allocated $2.27 billion to the Ministry of Power and $786.95 million towards DDUGJY.
Economic growth potential, increasing prosperity, a growing rate of urbanization, and rising per capita energy consumption is contributing to increasing demand for energy in the country. Owing to these factors, the Indian energy and power industry is an attractive location for foreign investors. For instance, Green Energy Corridor with an estimated investment of $5.8 Bn has been set up to ensure evacuation of renewable energy from generation points to the load centers by creating transmission infrastructure. Further, the upcoming 100 smart cities under the Smart City Project have huge scope for being powered by renewable energy. Scheme for the Development of solar parks and ultra-mega solar power projects along with hydropower projects is expected to attract billion-dollar investments. Primary foreign investors include Enercon (Germany), Vestas (Denmark), Applied Materials (US), Asian Development BankEnel (Italy), Gamesa (Spain), Orix (Japan), Nordex (Germany), and Mudajaya (Malaysia).
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