Infrastructure is one of the most critical components of the economic growth and welfare of nations. Power is essential for the development of robust infrastructure.
The power sector in India is among the most diversified in the world. We have access to power generation sources from a wide range including traditional sources such as coal, lignite, natural gas, oil, hydro and nuclear power to new, non-conventional sources like wind, solar, and agricultural and biofuel. The demand for electricity in our country has risen rapidly, with an increase in population and is expected to grow further still in years to come. To meet this increasing demand, we need an addition to the existing capacity of power generation.
In 2018, India ranked fourth in the Asia Pacific region on an index that measured the overall power of 25 countries. Last year saw some significant milestones in most segments of power while uncertainty held back a few others.
Let us go over some facts about the energy sector and what trends it will witness in this year.
The growing demand for electricity in the Indian economy has redefined the industry outlook and brought about a significant change in the power sector. The government’s focus on attaining power for all has accelerated the capacity addition in the country. This is accompanied by an increase in competitive intensity for both the market and supply sides with respect to fuel, logistics, finances, and manpower.
The total installed capacity of power stations in India was 350.16 Gigawatt (GW) as of February 2019. This year is predicted to be one of revival and rebalancing for the power sector.
The industry has attracted an approximate US$ 14.18 billion in Foreign Direct Investment (FDI) between April 2000 and December 2018. This makes for 3.48% of the total inflow of FDI in India.
The Government intends to achieve 175 GW capacity in renewable energy by 2022. 100 GW of solar energy and 60 GW of wind power is part of this energy projection.
By 2022, solar rooftops are expected to meet a target generation of 40 gigawatts through the ‘rent a roof’ policy proposed by the Union Government.
We are on the way to becoming the first country in the world to fulfil all our lighting needs by 2019 using LEDs saving a whopping Rs 40,000 crore (US$ 6.23 billion) on an annual basis.
Owing to this rapid growth, the business of operations of utilities is becoming more complex. Utilities were connected to 23 million new households last year, this has given power generation companies in India the opportunity to invest in digital technologies and outsource work to private operators to manage this growth efficiently.