As the minister in charge of power, coal and new and renewable energy, Piyush Goyal is the man responsible to meet India’s enormous energy challenge. The country needs to at least double its energy output over the next five-seven years if it is to keep on top of its growth agenda and the power minister is confident he will meet that target. And, there is just cause behind this optimism as the power ministry under his stewardship was recently described as the best performing one in the country.
India Inc. caught up with the energetic energy minister during a stopover in London recently and probed him on India’s road to becoming a renewable energy hub with solar energy as a key component.
Where does solar energy fit into India’s renewables plan?
Solar will be a mainstay and we are looking at 100 GW of solar by 2022. We have wind of about 27/28 GW commissioned and want to take that up to 60 GW. Hydel has come under a little bit of stress, particularly after the last few disasters in our part of the world, so the plans are largely around wind and solar.
We are also looking at waste to energy but that again would be a smaller component.
How is the solar strategy shaping up?
The National Institute of Solar Energy (NISE) is doing some very good work on innovation to bring about technologies which are suitable for off-grid solutions, especially in rural areas. We have some wonderful young enthusiastic scientists working on solar-thermal and other areas.
We are also going in for large solar parks – 19 solar parks have been identified on which land is available, green corridors are being created. So there is a very focussed effort to meet the 100GW solar energy target by 2022 and we are very confident that we will be able to do that.
How confident are you on meeting these ambitious targets?
We have not missed any of the targets that we have set so far. In the first year of the Modi government, we added 22,100 circuit km of transmission capacity, it’s the highest India has done in its history. Targets were never achieved in India normally – we are 117 per cent of the target. So we are talking to a plan, not in the air.
Coal production by Coal India was to increase by 25 million tonnes this year, we did 32 million tonnes – more than what was achieved in the last four years before that between 2010 and 2014.
Power generation crossed 1 trillion units which is an 8.5 per cent growth, which is also a new record. We did 22,566 MW of power generation capacity increase, the highest ever generation capacity increase ever in India. The power deficit has come down to 3.6 per cent, the lowest in the history of India.
How do India’s clean energy targets balance the use of coal?
India needs to at least double its energy output in the days to come. I see 1 trillion, a record we surpassed last year, going up to 2 trillion. We are on track with a plan on how that will be achieved and that has to massively include coal.
The US and Europe used coal and thermal power for over 150-200 years. India today consumes as much coal per capita as the US consumed 150 years ago. And for the last 150 years, all of the developed Western world has used coal/thermal power to create jobs for their people, to ensure their people had homes, to industrialise their nations, to build super-highways, airports, roads etc.
Today they are talking of clean energy and climate change after discovering low-cost shale gas. They didn’t talk about it until they got shale gas at these low prices.
Yet India is today planning to expand and ramp up its renewable energy five-fold, from 60 billion units to 300 billion units in the next seven years and taking our installed capacity to 175 GW, which is something unparalleled in the world.
Does this put India on a confrontation path?
There is no confrontation. We will be telling them the truth as it is and telling them about the action that we are taking. India is becoming a renewable energy hub and we have massive rollout plans in the next few years.
But what is required are innovative financing of clean energy and the West will have to pay for the damage it has caused to the world and planet. That is something the Western world will have to take the responsibility for because after all they have taken out all this CO2 in the world and damaged the planet. There can be several models, which could include long-term financing, low-cost financing, if they are truly genuine in their interest to support the efforts of countries like India.
And, energy security will have to be one of the major dimensions of the agenda. India is committed to providing affordable 24/7 power and for that we will have to create an energy secure India. So while we can give renewable energy certain amount of push, we cannot wish away thermal power. The only way forward for us would be to look at clean thermal power, improving the carbon emissions coming out of thermal power. And in that India is willing to take the lead.
Where do overseas investors fit into the vision?
We are looking at an investment of $250 billion in the next five years in the energy sector where London markets, for instance, can play a huge role. It is so strategically located and India is so comfortable working with the London market to finance this required investment.
We are creating a robust environment which is investor friendly, where lenders/bankers feel confident about the enforceability of contracts and about our ability to fulfil our commitments. The idea is to create a regulatory framework which is predictable and keep your taxation simple.
Finally, has the first year of Modi government met all expectations?
It is for the people to judge finally but we do feel in terms of the first year in government we have been able to bring about significant structural improvements in a variety of areas. One big achievement has been the fact that we’ve been able to bring back the confidence in India that had been missing for several years.
In terms of financial inclusion and outreach to the poor of India, I believe several social security measures have been a resounding success. The economy is back on track.
I personally believe that if we set exacting and very difficult targets that will bring the best out of the government. Many of the indices already suggest progress – deficits are down, the economy is on an upward trajectory. Inflation has been very much under control in the last one year, which clearly shows that in the years to come we can clearly look at a lower interest cycle which will spur growth going forward.
The world’s largest democracy, a billion aspirational people who are looking for a better quality of life, offering an unsurpassed business opportunity and a nation which is positioned geo-politically in such a sensitive place as bridge between the East and the West, India does have a very important role in the years to come.
I think the world today recognises Prime Minister Modi as a person who will shape the destiny of the future and clearly someone who has taken India’s image to glorious heights. Today the world talks to India as a partner, as an equal. Gone are the days when we were treated with a very also ran position and I think that makes every Indian very proud.