A new report by Primus Partners highlights crucial regulatory and financial reforms to accelerate India’s clean energy transition and achieve its 500 GW renewable energy target by 2030.
India’s power sector is at a turning point, with ambitious clean energy goals requiring urgent regulatory and financial reforms. A new report by Primus Partners, “The Intersection of Power Sector Regulation & Sustainability Goals in India,” highlights critical areas that need attention to achieve the country’s 500 GW renewable energy target by 2030. Here are five key insights from the report:
1. Strengthening Discom Finances is Essential
India’s power distribution companies (discoms) are burdened with losses exceeding ₹6.77 lakh crore (~$82 billion). To ensure financial stability, the report suggests restructuring debt, rationalizing tariffs, and implementing direct benefit transfers for subsidies. These measures will help improve cost recovery and ensure timely payments to renewable energy developers.
2. Regulatory Stability Can Boost Investor Confidence
Inconsistent policies across states on open access, net metering, and power purchase agreements (PPAs) have hindered long-term investments. The report calls for standardized open access rules, stronger contract enforcement, and improved dispute resolution mechanisms to create a stable regulatory environment for investors.
3. Addressing Land and Permit Challenges for Renewable Projects
Land acquisition and environmental clearances remain significant barriers to large-scale renewable energy projects. The report recommends expanding pre-cleared renewable zones and implementing GIS-based approval systems, similar to Rajasthan’s model, to streamline permitting and accelerate project development.
4. Strengthening Grid Infrastructure for Renewable Integration
Transmission bottlenecks have delayed solar and wind projects across India. The report emphasizes the need for synchronized grid expansion, better forecasting mechanisms, and policy support for large-scale battery storage to integrate renewables seamlessly into the power grid.
5. Expanding Market-Based Incentives for Clean Energy Growth
India is gradually adopting market-driven mechanisms like carbon credit trading, green energy certificates, and ancillary service markets. The report highlights the importance of expanding these initiatives to create a competitive and investment-friendly clean energy sector.
As India aims to meet its global climate commitments and transition to a sustainable energy future, addressing these regulatory and financial challenges will be crucial. The report underscores that a stable policy framework, robust infrastructure, and investor-friendly reforms are key to unlocking the full potential of India’s renewable energy sector.