Disclaimer: The views expressed in this article are those of the author and do not necessarily reflect the views of the Economic Times – ET Edge Insights, its management, or its members

In an interview with ET Edge Insights, Mr. Rahul Munjal, CMD, Hero Future Energies, addressed topics like environmental sustainability, decarbonization, accomplishing the Net Zero objectives, and more.

Q1) Is economic growth and reducing emissions possible at the same time?

Both are integral elements of India’s development strategy and must be pursued in a concomitant manner. The key lies in planning to minimise disruptions to energy supply and industrial processes.

Renewable energy is the preferred source of power in most of the world today. There are several reasons for this. Firstly, the cost of power from renewables is less than new build fossil fuel plants. Secondly these costs are inflation proof while thermal power prices are subject to volatility in prices of coal and gas. Thirdly the cost of renewable power will continue to decline. LCOE from solar PV has fallen by 88% in the last decade and this downward trend will continue not withstanding minor blips. A recent analysis showed that solar generation in seven Asian countries, including India, helped avoid approximately USD 34 bn in fossil fuel costs in H1 2022. All this saving in energy cost directly contributes to economic growth.

India has a target of installing 500 GW of renewable energy by 2030, expected to be about 50% of India’s installed power capacity. The vast scale of wind/solar deployment, technological innovations and T&D infrastructure upgrades required have potential for generating over 3 million jobs across skill levels which will further boost the economy.

All said and done the cost of not doing anything would far outweigh any temporary impact on GDP growth.

Q2) Could you tell us about some of your organization’s initiatives to improve the environment?

HFE is a renewable energy developer and last year we helped mitigate over 2.6 mn tons of CO2. Our plants are generating power from renewable sources and contributing to preserving the environment even as I write this.

We strive to minimise negative impact on the environment from our operations. Efficient material consumption and water management, minimising and recycling waste, preserving biodiversity are some of the ways we have integrated sustainability in our operations. We have switched to robotic cleaning of modules in water stressed areas. To safeguard biodiversity, we have carried out under-ground cabling and installed bird deterrents for external transmission lines. Sensitivity to environment is the cornerstone of our project execution and plants.

Q3) Your thoughts on how India could decarbonize its energy system by 2050 while continuing to make strong progress on economic development?

CMD, Mr. Rahul Munjal, Hero Future Energies.

According to BNEF India’s cumulative power capacity is expected to touch 2,260 GW by 2050 with a bulk of this coming from Renewables. The sustained growth of renewables requires a stable grid. Development of hybrid plants, which would be a combination of wind, solar and long duration storage will make power from renewables firm and dispatchable. Development of stand-alone storage projects will also facilitate grid balancing. The grid must be strengthened to ensure availability of required transmission capacity and must also enable transmission of excess power to low wind and solar radiation regions. The power grid must be digitalised and smart for improved dispatching and forecasting.

Decarbonisation would require electrification of vehicles with the added side benefits of energy security and reduced urban pollution. Falling battery costs would enable EV market growth. India will invest in charging infrastructure to support the growing EV fleet. Li+ ion battery annual demand is expected to reach almost 185GwH by 2035 and raw material security for indigenous battery manufacturing will be ensured.

Increased electrification of economy with renewable energy unfortunately will still not ensure net zero. Hard to abate sectors such as steel, cement etc which rely on fossil fuels for high process heat also must be decarbonised. To achieve this, technologies for production of green H2 along with associated technologies for green steel, green cement etc are required. Green H2 is also a potential fuel for long distance trucking and aviation.

Nuclear energy role will also play an important role to fill in for unmet energy demand.

Q4) In your opinion what are the strategies needed to put in place to achieve net zero?

India is adopting a sectoral approach to net-zero because each sector is at a different level of technological advancement. The technologies for power sector decarbonisation are the most mature and are being deployed on a massive scale. India would be deploying an average of 25 GW of solar and 10 GW of wind annually. The grid is being made interconnected and smart to adapt to the intermittency. Simultaneously support for fossil fuels is being phased out. No new coal plant should be built, old coal plants must be retired.

The next sector is road transportation. Technological progress and cost reduction in batteries can make mass shifting to EVs economically viable within the decade. Setting clear targets for EVs and restricting / banning ICEs beyond a future date will send the right signal for unleashing investments and innovation in this sector.

Biggest challenge lies with harder to abate sectors such as steel, cement, chemicals, aviation, and shipping. Green hydrogen, green steel, green cement, green chemicals etc will command “Green premiums” in the initial stages and thus would require policy support in the form of carbon pricing, usage mandates, carbon emissions related product standards and public procurement.

Energy and resource efficiency of buildings will also be a major contributor to emission reductions. Specific standards and regulations for energy efficiency must be put in place.

Agriculture is another major source of greenhouse gas emissions and to mitigate them requires reduction in food wastage, diet shift and support for high yield crops etc.

Q5) Your opinion on the just concluded COP 27 summit and its outcomes?

The world was looking forward COP 27 to address 3 major issues – a ratcheting up of emission reduction commitments by all nations, flow of climate finance from developed nations to developing economies and strong signals for phasing down of all fossil fuels. However, it appears that the outcome of the talks has fallen short of our expectations on all these fronts. Having said that, one heartening development was the Global North agreeing to create a fund to compensate developing countries from climate related loss and damage. This should build increased trust in climate talks and accelerate decarbonization in emerging economies. While nothing substantial was achieved towards mitigation and adaptation, a positive development was the call to reform the global financing architecture to be aligned with climate centric goals. Tweaking the mandates of multilateral development banks and international financial institutions will ensure that greater financing flows to energy-transition projects and efforts to adapt to a warming planet. I am optimistic that with adequate policy support, market forces will drive decarbonisation for realising the net-zero goals.

By

Mr. Rahul Munjal, CMD, Hero Future Energies.

Disclaimer: The views expressed in this article are those of the author and do not necessarily reflect the views of the Economic Times – ET Edge Insights, its management, or its members