India to meet half of electricity needs via non-fossil by 2030: IEA

India is expected to meet its 2030 target to have half of its electricity capacity be non-fossil well before the end of the decade, according to the IEA’s new World Energy Outlook 2023. The global energy agency says if the new solar PV module manufacturing capacity under the PLI programme comes fully online by 2026, it will progress the solar capacity in India to well over what is needed by the end of this decade.

India could, however, continue importing solar PV modules for a few years because developers will source the cheapest panels available, says IEA. "...as domestic production ramps up, solar PV module imports will decline and it will help to establish India as a reliable exporter."

India has historically been a net importer of fossil fuels and has now become an importer of modern clean energy technologies as it scales up solar and wind power generation capacity.

Notably, India's imports of solar PV modules in 2021-2022 were valued at $3.4 billion. To boost the clean energy sector, the government launched a production-linked incentives (PLI) programme in 2020 to attract investment in critical areas like solar PV modules and advanced chemistry cell battery manufacturing.

The IEA report also talks about India's ever-increasing energy usage, saying due to space cooling, electricity consumption increased by 21% between 2019 and 2022. Today, nearly 10% of electricity demand comes from space cooling requirements.

Over the past five decades, India has witnessed over 700 heatwave events, which have claimed over 17,000 lives. Fuelled by its geographic and meteorological conditions, air conditioner ownership in India has been steadily rising as the incomes grow, tripling since 2010 to reach 24 units per 100 households, the IEA data shows.

“The impact of cooling needs on electricity consumption is already clear. Electricity demand is sensitive to temperatures, and in India’s case, there is a sharp increase in demand as temperatures cross the 25°C threshold," says the report.

By 2050, household air conditioner ownership is estimated to expand ninefold, outpacing the growth in ownership of every other major household appliance including televisions, refrigerators and washing machines. "By 2050, India’s total electricity demand from residential air conditioners in the STEPS exceeds total electricity consumption in the whole of Africa today," the report adds.

IEA's World Energy Outlook shows there are set to be almost 10 times as many electric cars on the road, with renewables nearing half of the global power mix, but much stronger policies are needed to keep alive the goal of limiting global warming to 1.5 °C.

After remaining consistently high over the past decade, global coal demand is now set to fall in the next few years. The share of coal-fired power in new worldwide capacity additions hit a high point in 2006 at 45% and has since fallen steadily to 11% in 2022, the IEA data shows, adding that changes in iron and steel production have also contributed to the decline in coal demand.