India's G20 Sherpa and former NITI Aayog CEO Amitabh Kant on Wednesday said developed countries including the U.S., the U.K. and Germany among others have backtracked on their climate commitments.
"Earlier this week, the German Finance minister questioned the aim to end coal use in Germany by 2030. The Prime Minister of U.K. – the first country to have enshrined carbon neutrality by 2050 in law has pledged to 'max out' UK's oil and gas reserves and authorised more than 100 new North Sea licenses. France is seeking stronger EU stance on phasing out fossil fuels. French Banks have financed $154 Bn towards biggest fossil fuel projects since the Paris Agreement. Japan has pushed for G7 to step up gas investments," Kant says in a post on X.
"In U.S., President Biden's efforts to promote offshore wind development was tied to the approval of new oil leases by the Congress. Recently, US EXIM Bank has approved USD 1.5 Billion for an overseas oil and gas project in Estonia, contrary to US and G7 promise to end international fossil finance. This is serious backtracking on climate commitments made by developed countries," he says.
These comments come ahead of the COP28 summit on climate change in the U.A.E. At COP27, countries reaffirmed their commitment to limit global temperature rise to 1.5°C above pre-industrial levels by the end of the century.
According to a report by energy think tank Ember, India will need an investment of $293 billion to meet the solar and wind capacity targets including generation, storage and transmission between 2023 and 2030.
India aims to achieve non-fossil fuel-based installed power capacity of 500 gigawatts by 2030.
India added 12.8 GW of solar and 2.28 GW of wind in 2022. To achieve its targets, India needs to increase these annual additions to 41 GW of solar and 11.8 GW of wind by 2027, the report authored by Neshwin Rodrigues says.
This $293 billion figure encompasses not only the development of solar and wind projects ($211 billion) but also accounts for the essential costs associated with storage and transmission required to integrate renewable energy at this expansive scale, the report says.
Despite investment risks, India needs financing to build capacity in renewables, storage and transmission to even meet the NEP14 targets. To further step up ambitions to match a global net-zero pathway, securing significantly more financing at competitive rates will be vital to ensure the viability for India to reach the goal. Access to this finance is critical for India to avoid building new coal capacity to meet its growing demand in this decade.
Renewable projects in India face investment risks, which may be a significant barrier to mobilise investment, according to the report. Despite the recent uptick in investments in solar and wind installations, individual renewable energy projects in India remain exposed to substantial risks; categorised into regulatory risks, project risks, and financing risks.
Some of these challenges include payment delays, renegotiation of Power Purchase Agreements (PPAs), and complexities related to land acquisition, Ember cautions.