India's cheapest power needs new buyers, Pg11

Key Highlights:

• India adds 40 GW of renewable capacity annually, exceeding most developed economies.
• 42 GW of auctioned renewable capacity awaits buyer utilities due to absorption constraints.
• Reverse auctions have achieved solar power paired with storage at approximately Rs 3 per unit.
• Open access and captive procurement drive roughly a quarter of India's renewable capacity addition.
• Manufacturing clusters, data centers, and export-oriented industries can procure clean electricity through open access.

Detailed Insights:

• The fall in clean-energy prices and institutional reforms are enabling structural shifts in India's power sector.
• Electric heat pumps and high-temperature heat batteries can shift industrial process heat demand towards clean electricity, reducing reliance on imported fuels.
• Green ammonia production using clean electricity is becoming competitive, potentially extending to green steel production.
• Electrifying buses, commercial fleets, and freight corridors can create flexible demand aligned with daytime solar output.
• Distributed rooftop solar across commercial buildings, MSMEs, and homes can lower bills, improve resilience, and reduce peak demand for utilities.
• Securitizing long-term clean-energy contracts through dedicated finance platforms and India Stack-connected fintech products can accelerate the transition for large and small buyers.
• Expanding demand for clean electricity can absorb India’s excess solar panel manufacturing capacity and reduce import dependencies through strategic partnerships for critical minerals like batteries.

Key Concepts Involved:

• Open Access: Allows large consumers to buy power from anywhere by paying network charges.
• Captive Procurement: Generation of electricity by a company for its own use.
• Carbon Border Adjustment Mechanism (CBAM): A carbon tariff on imports based on their carbon content.