India: The Difficult Energy Transition of Developing Countries

Updated on 07.06.2021

10 min read

High School

India has launched an impressive renewable energies program, but its and oil consumption will continue to grow in the years ahead. This illustrates the difficulty of achieving an energy transition when demographic pressure and aspirations of higher living standards continue to push up energy demand.

Solar panels energy transition India
India is expected to overtake China as the most populous country by 2025, with an estimated population of 1.5 billion

A Fast-Growing Country With a Huge Population

With 1.3 billion inhabitants, India is the world’s second most populous country, after China. However, it should overtake its Asian neighbor and see its population rise to 1.5 billion by around 2030. In 2035, India aims to be one of the world’s top five economies, with major growth in its middle classes. The expansion and modernization of its cities has been nothing short of spectacular. According to a report by the 1, over 500 million rural inhabitants have been connected to the grid over the last 20 years. Unlike Africa, India has more or less completely resolved the issue of access to , an essential development factor.

India’s demographic and economic expansion means that the sub-continent has an ever-growing need for energy. consumption has risen twofold since 1990, and is expected to double again by 2040. Electricity consumption is set to treble, especially as climate change will bolster demand for air conditioners. This increase is immense in absolute terms, even if, per capita, consumption is still just a third of the global average.

Reliance on Coal and Oil

India’s is dominated by coal (accounting for 55%), followed by oil (30%) and natural gas (nearly 8%); the latter two resources are mostly imported. Coal generates 75% of all electricity in the country.

India has the world’s fifth largest coal reserves and therefore access to a low-cost local source that employs millions of unskilled workers. The government is attempting to promote the use of a less polluting alternative, gas, in thermal power plants, but cost and social stability reasons have made this difficult.

Natural gas consumption has, however, risen in one highly sector: heating and cooking. Indians make extensive use of , particularly wood, which raises the issue of deforestation and health in rural areas. The situation is worse in urban areas because of the coal-fired power plants located in city outskirts and the huge increase in traffic. Pollution has reached alarming levels in the capital New Delhi, where the level of fine particles is the world’s highest according to the World Health Organization (WHO).

Cutting CO2 Emissions 

India’s greenhouse gas emissions tripled between 1990 and 2018, while global emissions increased by 67%. Unless the country’s development model is radically overhauled, these emissions could double by 2030, overtaking the United States. For a long time, India hesitated to make international climate commitments, putting forth its needs for growth and calling attention to the historical responsibility of rich countries.

But the potentially catastrophic impacts of climate change on monsoon patterns, melting Himalayan glaciers, and repeated floods and cyclones have convinced the country to make a firm commitment to cutting its emissions.

To achieve this goal, India is seeking to promote gas over coal and increase the number of electric vehicles on its roads (particularly to replace small city cars such as the “Tata Nano”, buses, taxis and the countless two-wheelers and rickshaws that clog up the streets of India’s cities). India is also working to improve . Like many other countries with major growth needs, India uses an alternative indicator to emissions in absolute terms: the carbon intensity of gross domestic product (GDP)2. This indicator is expected to be cut by at least a third by 2030 versus 2005 levels.

The share of fossil fuels in India’s energy mix.

The Rise of Renewables

Underpinning this target are the country’s big ambitions for renewable power (wind, photovoltaic solar, hydro). In 2019, renewable electricity accounted for 17% of the power generation mix (over half of which was supplied by hydropower), with the aim being to raise the figure to close to 40% by 2030.


Proactive efforts in this field are reflected in the construction of massive solar farms, including the Kamuthi photovoltaic power plant in the southeastern state of Tamil Nadu (648 megawatts of peak capacity), once the largest of its kind in the world. The 2.5 million solar panels are cleaned by robots, thus providing a solution to the Indian countryside’s endemic dust problem.


Nuclear Power


India is also developing its nuclear fleet for a supply of “carbon-free” energy. Boasting extensive experience in military applications, India has developed its own nuclear technology and is actively researching fourth-generation (fast- ) reactors.

  1. IEA report – India 2020
  2. The carbon intensity of an economy is equal to its CO2 emissions divided by its GDP. The goal is to reduce this indicator as much as possible by keeping emissions low while maintaining strong growth.


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