India: 12% Growth in Renewable Energy Investment

A report launched this week by the United Nations Environment Program (UNEP) indicates very impressive trends for India's renewable energy sector. According to the report, 'Global Trends in Sustainable Energy Investment 2009', India's renewable energy investment grew by 12% in 2008. With an investment of $3.7 billion in just a single year, India's renewable energy sector appears well on its way to meeting the ambitious target set by the Indian Government in the 11th Five Year Plan. The plan aims for the sector to grow to $19 billion from 2008 to 2012, with renewables making up 20% of the 70,000 MW of total additional energy planned from 2008-2012.

This is extremely positive news, and bolsters India's global leadership in the transition to clean, renewable energy. Renewables (including hydro) already account for 34% of India's current Installed Power Capacity (if nuclear power is included, then 37% of India's current Installed Power Capacity is "clean"). India is currently ranked fifth in the world in terms of its wind power generation.

The investment in solar energy grew from $18 million in 2007 to $347 million in 2008. The investment in small hydro projects grew about four-fold to $543 million in 2008. The growth in biofuels fell by 80% from $251 million in 2007 to $49 million in 2008.

This type of growth is not new to this sector; India has been actively increasing its strength in renewable energy over the past many years. From 2002 to 2007, there was 3,075 MW of renewable grid-tied power planned, but the actual capacity addition exceeded 6,000 MW by 2006. A large share of this was the result of exceptional growth of wind energy in India. Wind energy is expected to add more than 10,000 MW of additional capacity by 2012, followed by small hydro (1,400 MW), co-generation (1,200 MW) and biomass (500 MW). Plans to scale up India's solar capacity through the National Solar Mission are also on the anvil.

We are all watching with interest as some of the world's most ambitious renewable energy projects roll out in India, and come on-line over the next few years. Just two of these examples include the Suzlon wind farm in Dhule, India, which when completed in 2010 will be the world's largest wind farm (already, its installed capacity is 650 MW, and its final capacity is slated to be 1000 MW) and the Acme Solar Thermal Power Plant in Haryana, India, which will be completed in 2019, and have an installed capacity of 1000 MW.

So, what's going to be next in India?

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