A new green wave of growth

Vandana Gombar assesses the green energy plans of Reliance, NTPC, Tata and Ola

Recent announcements from leading Indian companies clearly show that the transition to green energy and clean mobility is as much a mantra locally as it is globally. Indeed, India’s role in the green economy is set for spectacular growth. The country may still make a good argument for its right to the “carbon space for development”, as Environment Minister Prakash Javadekar did at the BloombergNEF Delhi Summit last week, and it may not be inclined to enhance its ambitions for staving off climate change yet, but policy actions are certainly speaking louder than words. This enabling environment is firing corporate ambition. 

Reliance’s $10-billion plan

Reliance Industries announced a Rs 750-billion plan to set up four giga-factories, and related supporting infrastructure. These four units will be for: 

• Manufacturing high-efficiency solar panels, from polysilicon to modules, with a target to achieve “costs that are the lowest in the world”. Reliance also plans to “establish and enable at least 100 gigawatts of solar energy by 2030”

• Advanced energy storage, in collaboration with global leaders in battery technology

• Electrolysers of the “highest efficiency and lowest capital cost” to produce green hydrogen

• Fuel cells that can power automobiles, data centres or telecom towers

Since the company has a record of disrupting and then dominating the industry it chooses to enter, there is apprehension and excitement over these announcements. Sharing these details at the annual general meeting, Chairman Mukesh Ambani also talked about decarbonising and repurposing the oil-to-chemicals business.    Reliance aims to be net carbon zero by 2035. 

NTPC’s 60-GW ambition

India’s largest power generator almost doubled its renewable energy goal to 60 gigawatts (GW) by 2032. A big chunk of this is likely to be solar. At the BNEF New Delhi Summit, Chairman Gurdeep Singh said that NTPC would add 7-8 GW of renewable capacity every year, and may not necessarily own it. By way of comparison, India added about 10 GW of new renewable capacity annually before the pandemic.

Separately, the company intends to list its subsidiary — NTPC  Renewable Energy — in the financial year starting April 2022, to help mobilise resources for the expansion, Bloomberg News reported last week, citing unnamed sources. 

NTPC is also moving ahead on its partnership with Oil and Natural Gas Corp. to explore opportunities in offshore wind power development in India. Power Minister R K Singh said last week that the government was exploring so-called viability gap funding for such projects, which would help developers overcome the high initial costs. As per an agreement signed about one year ago, NTPC and ONGC plan to work together on storage and electric mobility projects as well.

Electric cars and hydrogen buses from Tata

Tata Motors recently detailed how it is transitioning to “sustainable mobility.” Chairman N Chandrase­karan said the company would have 10 new electric vehicle models by 2025, and also “invest proactively to set up charging infrastructure across the country.”

“EV penetration in our portfolio has now doubled to 2 per cent this year and we expect penetration to increase exponentially in the coming years,” he said in the annual report. The Jaguar and Land Rover brands are also on the electrification path. 

On June 30, the company announced an order of 15 fuel-cell buses from Indian Oil. The hydrogen required will be generated and dispensed by the oil company.  Tata Group is also exploring partnerships for cell and battery manufacturing in India and Europe.

Ola’s two-wheeler ride

India’s vehicle market is dominated by two-wheelers. They accounted for 80 per cent of the 18.6 million units sold in the last financial year ended March 2021, and that is the market segment where Ola Electric is placing its biggest bet. The company is building the world’s largest two-wheeler factory in the south Indian state of Tamil Nadu, with a production capacity of 10 million units annually when completed. Founder Bhavish Aggarwal shared a video teaser of his test ride of the new Ola electric scooter on Twitter. (https://twitter.com /bhash/status) The company is also rolling out “the world’s largest and densest” charging network for its two-wheelers across the country.

Tata Power’s 10-GW bid

Tata Power Solar has invited global bids for supply of 10 GW of solar panels “over a period of five years from August 2021 to July 2026.” The company manufactures its own panels, and also sources panels externally for its engineering, procurement and construction business. It has never sourced panels at this scale before.

Gas company GAIL has carved out plans for production of ethanol, as well as compressed biogas from municipal waste, in addition to setting up 1-gigawatt of renewable energy capacity, according to various media reports. It joins other government-owned companies, like Coal India, SJVN and Singareni Collieries, that are plugging into the new energy economy to enhance and expand revenue streams. 

The writer is  editor – global policy for BloombergNEF.  vgombar@bloomberg.net