India: Coal or Solar?

India has built a lot of coal power stations, but will they become stranded assets, displaced by cheaper, cleaner solar?

India has built a lot of coal power stations, but will they become stranded assets, displaced by cheaper, cleaner solar?

Last month atmospheric Co2 levels passed 410 parts per million. To avert climatic catastrophe humanity needs to shift away from fossil fuels as quickly as possible. India presents us with both the scale of the challenge and the scope of possibility. The government of India wants to bring electricity to all its 1.3 billion people, the population is still rising and the country is rapidly industrializing. Energy demand is increasing, and so too carbon emissions. Many new coal fired power stations were built in the decade 2007 to 2017, more than doubling coal capacity. This all bodes ill for local air quality, and for the global climate. At the Paris climate summit a couple of years back the Indian government was rather dragging its feet, only promising to decrease the carbon intensity of its economy, while planning for rapid economic growth and emissions still rising for years to come.

However things could change for the better very rapidly. The price of solar, both photovoltaic and concentrating solar thermal, is falling fast, and India has a very good solar resource. In 2017 for the first time India added more new renewable capacity than new coal. Many coal plants are proving economically unviable: they simply cannot match solar on price and are shutting down. As solar prices are predicted to keep falling this should only accelerate this process. Currently the government are still trying to protect coal from these market forces. They are also beginning to grasp the new opportunities that solar can bring. For isolated rural communities across India local solar plus storage will be key to their development. At the other extreme are new solar based megacities.

The Dholera Special Investment Region, located near the head of the Gulf of Khambhat in the Indian state of Gujarat, is a huge area earmarked for a new city and cleantech industrial hub. A 5 GW solar pv plant is planned, with local manufacture of solar cells and panels and other ancillary industries. This will further decrease the price of solar electricity, hastening the demise of coal. A project like Dholera opens up many new opportunities to create new forms of prosperity not based on ever more pollution but on new and ecologically sustainable technologies. It would be a perfect place to invest heavily in solar desalination and new forms of super productive hydroponic agriculture, on many forms of energy storage and on electric and hydrogen fuel cell transportation systems. India could lead the world with the speed to its energy transition. Technologically India has lagged behind Europe, USA or China, but it has probably the best solar resource of these four. It could leapfrog them, and be the first solar powered superpower. Essentially it is a political choice, which path India will follow, coal based or solar based development? The economics of going all out for solar are looking increasingly good, which is good news for India, and for the rest of us.

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