While the Government is seeking to increase generation of electricity from renewable sources, India continues to rely on thermal sources to meet the growing demand. Of India’s current generation capacity, more than 66% is from thermal power plants; some 85% of this (about 57%) is coal-based power. Hydropower accounts for about 19% of capacity, while the remainder comes from nuclear power, wind and other renewable sources of energy. There is an urgent need in India to add significant generation capacity in a short time frame.
India has made progress in adding wind-based power using reform initiatives that promote renewable sources and provide tax advantages to the private sector. However, wind power has limited reliability and higher cost of generation makes it unsuitable to meet large-scale base load demand. Gas-based power is also not a viable alternative to replace coal-based power on such a large scale. Not enough natural gas is available in India, and the power it generates is too expensive for the country’s industrial or domestic use. This implies that the fuel mix of India’s generation capacity is expected to remain roughly the same in coming years -- which means that the country will continue to depend heavily on coal-based power. It would therefore be important to make the right choices in selection of the right technologies and run the plants in an energy efficient, environmentally efficient and operationally efficient manner.