One of the fastest growing economies in the world– behind China, India aims to triple its renewable power capacity by 2022, and would cost about $42 billion a year through 2030 to meet its renewable energy potential.
BE2C2 Report — French energy company ENGIE says it has teamed up with an investor to help develop wind energy projects in India.
The company formed a partnership with Dubai-based Abraaj Group to develop as much as 1 gigawatt of wind power in the Indian energy sector.
“Energy demand is growing tremendously in India, and ENGIE is investing in green energy sources as part of supporting the country with its sustainable development plans,” Sébastien Arbola, the regional CEO of ENGIE,” said in a statement.
The French utilities company estimates power consumption in India will grow at an annual rate of 9 percent through 2020. To meet the demand, the government set ambitious goals for a low-carbon economy.
India is No. 4 in the world in terms of new solar power and for cumulative wind power capacity. As a party to the Paris climate agreement, the country could triple its renewable power capacity by 2022 to 175 gigawatts by drawing on new solar and wind energy sources.
“The Indian renewables sector has seen strong growth in recent times and we expect demand for power across the country will continue to increase,” Saad Zaman, an Abraaj partner, said.
Moody’s Investors Service said recently in its quarterly publication that, as the economy expands, growth will continue in the renewable energy market in India but there are substantial risks to financing and execution.
“Moody’s also sees challenges for renewable energy projects, notably weak offtaker credit quality and an evolving regulatory framework, as well as financing and execution risks, and aggressive bidding,” the ratings agency said.
The International Monetary Fund earlier this year warned that India may have trouble attracting new capital because of weakness in the nation’s banking system.
The International Renewable Energy Agency found that the Indian government could save on health-related costs and create more jobs while at the same time see the demand for coal and oil products drop between 17 percent and 23 percent by 2030.
“Balancing economic growth and development, environmental protection, and energy security is a real challenge in India that can be tackled by enabling more renewable energy deployment,” Dolf Gielen, a technology director at IRENA, said of a report from the agency.
Its report on the renewable energy prospects recommended India mobilize financing and change consumer habits for things like transportation and cooling as well. By IRENA’s estimate, it would cost India about $42 billion a year through 2030 to meet its renewable energy potential.
Meanwhile, Abraaj Group has appointed a former key diplomatic figure in the Middle East peace process as its managing partner.
Kito de Boer will oversee Abraaj’s Impact Investing business and will spearhead the group’s global efforts to deploy private capital as a means of tackling some of the world’s most pressing challenges.
Prior to this diplomatic posting, he spent 29 years with McKinsey & Co based in London, New Delhi and Dubai.