India's C&I Sector Leads Global Renewable Energy Push
Corporate giants are increasingly turning to renewable energy, with India's Commercial and Industrial (C&I) sector leading the global charge. In 2020, Power Purchase Agreements (PPAs) with renewable energy producers surged by 18% to 23.7 GW, marking a near 40% compound annual growth rate over the past five years.
India's C&I sector added 1.4 GW of PPA capacity in 2019, making it the second-largest growth market worldwide. This trend is set to continue, boosted by new technologies like high-efficiency solar modules and battery energy storage systems. Companies are drawn to renewable energy by potential savings of over 50% in electricity consumption and the opportunity to comply with ESG standards, attracting cheaper capital and generating higher equity returns.
Currently, the C&I sector consumes 50% of India's power, with only 3.5% coming from renewables. However, this is expected to increase to 65 GW by 2025. Long-term PPAs provide predictability in electricity costs, with notable companies like Adani Green Energy Limited (AGEL) driving this growth. To limit average temperature increase to 1.5°C by 2050, net CO2 emissions must fall significantly by 2030 and reach net-zero by 2050. Avoiding carbon tax threats, predicted to increase by 600% by 2030, is another incentive for companies to adopt renewable energy.
Market options for sourcing green power include onsite rooftop solar, open access PPA, group captive PPA, green term ahead market, and round the clock PPAs. As the global race to net-zero intensifies, India's C&I sector is poised to play a pivotal role in driving renewable energy adoption and mitigating climate change.
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