Investment in India's renewable energy sector has been close to or higher than $10 billion every year since 2016, according to the Economic Survey 2022-23 that was tabled in the Parliament on January 31.
“India is progressively becoming a favoured destination for investment in renewables,” The survey document said. It cited the Renewables 2022 Global Status Report to further state that during the period 2014-2021, total investment in renewables stood at $78.1 billion in India.
The government also said that 62 percent of India’s total installed capacity will be from non-fossil fuel by 2029-30. This is in line with India’s target of having 500 gigawatt (GW) of non-fossil based power capacity out of a target of at least 800 GW by 2030.
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“The Central Electricity Authority (CEA) has projected the optimal generation capacity mix to meet the peak electricity demand and electrical energy requirement for 2029-30. The estimate builds in improved efficiency and minimises the total system cost subject to various technical/financial constraints. Moreover, the CEA has also estimated that the average emission rate will decline by around 29 percent by 2029-30 compared to 2014-15,” the economic survey stated.
CLIMATE FINANCING
The economic survey has noted that to meet India’s long-term target of achieving net-zero emissions by 2070, “tens of trillions of US dollars” will be required.
“Finance is a critical input in India’s climate actions. The country’s climate actions have so far been largely financed from domestic sources, including government budgetary support, a mix of market mechanisms, fiscal instruments, and policy interventions… The understanding in the Convention and the Paris Agreement has been that the developed countries will mobilise the resources through public and other sources, including by catalysing private finance to enable a flow of financial resources at a reasonable cost. While these are yet to materialise, India has scaled up its efforts towards greater mobilisation of private capital to meet its ambitious climate action goals,” the report stated.
Talking about green bonds, the survey stated that countries such as UK, France, Germany, the USA, and China resorted to green bonds to raise funds.
“IMF data indicates that green bonds of value around $620 billion were issued across the world in the year 2021, in which countries issued green bonds of value $587.7 billion and international organisations issued bonds of value $32.3 billion. As per SEBI’s data on green debt securities, during the period of 2017 to September 2022, 15 Indian corporates have issued green bonds of value Rs 4,539 crore. Most of these are related to renewable energy generation, while one is slated to be used for the tertiary treatment of wastewater,” read the economic survey.
The Reserve Bank of India (RBI) has notified the indicative calendar for the issuance of Sovereign Green Bonds (SGrBs) for the fiscal year 2022-23. The issuance would take place through two auctions – one which happened on January 25, 2023; the other on February 9, 2023, respectively, for Rs 8,000 crore each, totalling Rs 16,000 crore. The security-wise allocation would include 5 year and 10 year SGrBs for Rs 4,000 crore each for both auctions, it stated.
It also mentioned that SEBI in its board meeting on December 20, 2022 decided to enhance the scope of the definition of green debt security by including new modes of sustainable finance in relation to pollution prevention and control, eco-efficient products, and so on. It also decided to Introduce the concept of blue bonds (related to water management and marine sector), yellow bonds (related to solar energy) and transition bonds as subcategories of green debt securities.
