Ambuja Cements Joins AFID; Pledges Rs 100 B for RE

Ambuja Cements plans to invest Rs 100 billion in RE projects, including 1 GW capacity and 376 MW waste heat recovery system

Ambuja Cements Limited, part of the diversified Adani Portfolio, has joined the Alliance for Industry Decarbonization (AFID). Ambuja is the first cement manufacturer in the world to become a part of the alliance.

AFID is a global alliance of companies across industries to accelerate net zero transition in line with the Paris Agreement.

As part of its green energy commitment, the company has announced its plan to invest Rs 100 billion in renewable energy projects. These include 1 GW capacity and 376 MW of energy from the waste heat recovery system (WHRS). The projects will power 60% of Ambuja Cements’ expanded capacity through green power by FY2028.

The company utilized over 8.6 million tonnes of waste-derived resources and became 11x water-positive and 8x plastic-negative in FY’24, it said in a statement.

“This marks another significant step for Ambuja in its sustainability journey. We are already amongst the lowest emission-intensity cement producers globally and are undertaking a number of strategic initiatives to further reduce our GHG emission footprint. Being a member of the Alliance for Industry Decarbonization would allow us to leverage the experiences of global cross-sector industry peers, and in turn, share our approach to decarbonization,” said Karan Adani, Non-Executive Director, Ambuja Cements.

It must be noted that the company, operating in the hard-to-abate cement industry, aims to achieve net-zero by 2050, with targets validated by the Science Based Targets initiative (SBTi).

The AFID aims to facilitate dialogue on an industry level and increase cooperation to help companies develop decarbonization strategies aligned with their countries’ commitments. The International Renewable Energy Agency (IRENA) coordinates and facilitates the activities of the alliance.

L’Oréal India has declared that it has switched its India operations to 100% renewable energy.

The company reduced energy usage in all its operating and manufacturing facilities. It switched to energy-efficient machinery, utilized solar water heating, and steam condensation waste energy.

For example, to reduce greenhouse gas emissions during operations, it switched to solar, hydro, and wind power at its Chakan and Baddi plants.

L’Oréal’s Chakan plant in Maharashtra switched to biomass boilers in October 2023, replacing natural gas through long-term power purchase agreements.

To meet its basic heating needs, L’Oréal invested in solar technology at its manufacturing and distribution facilities in 2006. It subsequently increased its photovoltaic array to more than 2000 by 2023.

Additionally, it utilized its hydro power source in the river basins of Himachal Pradesh to meet its energy requirements.

Aseem Kaushik, Managing Director, L’Oréal India, said, “In our 30th years in India, this achievement demonstrates our commitment to transform ourselves. It also represents the sustainability mindset and agility of the L’Oréal India workforce towards growing business, responsibly. Reaching 100% renewable energy in India is one step of many in our sustainability journey. L’Oréal India will continue to transform our business activities in line with Science Based Targets and empower our business ecosystem to transition to a more sustainable world together.”

India’s top companies are lagging in achieving their renewable energy and decarbonization targets.

These include cement, steel, aluminium, textiles, and fertilizers, says a Climate analyst firm Climate Risk Horizons (CRH) report.

According to the analysis, Indian corporates are slow to transition to renewable energy. Only 5% of their annual electricity consumption comes from renewable sources.

CRH’s report, Slow to Switch, evaluates 33 companies across seven industries, including five large energy consumers, using publicly available data from their annual and sustainability reports.

Sectoral analysis:

The analysis finds that most corporates are not on track to achieve their decarbonization goals. While the information technology industry emerges as the overall top performer, the fertilizer sector lags behind with the poorest score.

• Steel companies such as JSW, Jindal, Tata Steel and ArcelorMittal/Nippon Steel are currently meeting a tiny fraction (less than 0.05% on average) of their energy from renewable sources.

• Textile companies such as Trident, Welspun, Arvind and Shahi have set targets in line with the Paris Agreement. But, on average, less than 3% of their energy consumption comes from renewable electricity.

• Cement companies like Ultratech, ACC and Ambuja have set targets to reduce emissions as per the Paris Agreement, yet the share of renewable energy in their overall energy consumption was only 2.5%.

• In the FMCG sector, Godrej, ITC and Britannia stand out for their low RE utilization, in contrast to Nestle and Hindustan Unilever, which fare the best in terms of translating renewable energy commitments into actions.

• The report highlights the significant potential of the heavy industry sector to drive decarbonisation in the Indian electricity system. The companies analyzed have an annual electricity consumption of over 169 BU (Billion Units), which is more than double the electricity consumption of Andhra Pradesh or West Bengal.

Authors note:

“Shifting to renewable energy is essential for energy security at the company level and for the Indian economy as a whole. While a few large companies have started to take steps in this direction, a lot more needs to be done, and a lot quicker, if India is to meet its decarbonization targets,” said Vishnu Teja, Energy Researcher and Lead Author of the report.

“India Inc needs to step up and start investing for an energy secure future. The country’s RE and decarbonization targets will not be met without active support from large corporate players. With green energy open access regulations now in place, companies should be signing Power Purchase Agreements to ensure that 100% of their electricity comes from renewable energy by 2030,” said Ashish Fernandes, CEO, CRH and co-Author of the report.

The statement of Power Secretary Pankaj Agarwal- India’s peak power demand may surpass the projected 384 GW mark and cross a new level of 400 gigawatts (GW) by 2031-32, didn’t come as a surprise. Each year, India has been recording a spike in power demand.

For example, the peak power demand already reached the 250 GW mark as of 30 May this year.

According to industry experts, the growing economy and rising temperatures will further push the peak power demand in the coming years.

“The way power demand has grown in some states in the last two years, the demand will touch 384 GW and may easily cross 400 GW by 2031-32,” Mr Agarwal said at the CII-Smart Metering Conference.

Can India meet the rising power demand?

One largely unanswered question and the proverbial loose end remains. Is India equipped to meet the growing power demand? This is a serious concern being raised across various forums, and requires careful analysis.

Undoubtedly, the power generation capacity has to double from the current level to meet the peak demand of over 400 GW. Currently, India has a total installed capacity of 444.7 GW. Thermal dominates the pack with 242.9 GW, 193.6 GW of renewables (wind, solar, hydro, biofuel), and 8.1 GW of nuclear capacity.

India has set a target of 500 GW of renewable energy capacity by 2030. In 2023, the government rolled out bids for 50 GW every year to speed up the momentum.

As per a press release from the government (Power and New & Renewable Energy) Minister in December 2023, 132 GW of electricity capacity is under construction, and 517 GW capacity is anticipated to be added by 2031-2032.

Furthermore, the government has stated unequivocally that dependence on coal-based generation is likely to continue until cost-effective energy storage solutions are available. “The country cannot achieve energy security by renewable energy sources alone,” the union ministry said in a press release.

Pegging the power demand:

The demand rise can be pegged to the following reasons:
a) Adding new consumers (December 2023 showed 2.86 crore new consumers)
b) Temperature rise
c) Rapid economic growth
d) e-mobility
e) Industrial growth

The peak demand in FY 2013-14 was 135 GW, which increased to 243 GW in FY 2023-24 (till Nov. 2023). As per the 20th Electric Power Survey (EPS), it is projected to touch 277 GW in FY 2026-27 and 366 GW in FY 2031-32, respectively.

Data:
As per the National Electricity Plan, the installed capacity requirement for the year 2031-32 is likely to be 900.4 GW, comprising 285 GW of fossil capacity (coal & lignite, gas) and 615 GW of non-fossil capacity (nuclear, large hydro, solar, wind, small hydro, biomass, pumped storage projects) along with battery energy storage system or BESS capacity.

The generation planning studies carried out by the Central Electricity Authority (CEA) show that the required coal-based installed capacity will be at 283 GW by FY2032 as against the present installed capacity of 214 GW.

Interestingly, after studying various aspects of renovation & modernization and life extension of coal-based power plants in August 2023, CEA has identified 148 units with a total capacity of 38.2 GW as potential candidates for R&M/LE works.

The authority, in letters dated 20.01.2023 and 07.07.2023, advised thermal power utilities not to retire or repurpose coal-based power stations before 2030 and to ensure thermal unit availability after R&M activities.

Our take:
While measures are being laid to address the rising power and peak power demand, questions are being raised on:

a) the funding requirements
b) the power infrastructure upgradation
c) ensuring uninterrupted power

At this point, I want to reserve my comments as I see more challenges than favourable factors in addressing the peak power demand.

Achieving net-zero requires no magic bullet.

These are the findings of a new report titled “Synchronizing energy transitions towards possible net-zero for India: Affordable and clean energy for All.”

The study aims to analyze India’s energy transition towards a net-zero energy basket, focusing on minimizing power costs and determining the optimal power mix for net-zero emissions.

Launched by IIM Ahmedabad as part of a study project sanctioned by the Office of the Principal Scientific Adviser to the Government of India with part-funding from Nuclear Power Corporation of India Ltd (NPCIL), the report is a comprehensive study, bringing together aspects from all sectors of power generation in one place, providing a holistic view of the Indian energy sector and throwing light on the potential pathways for a development-led transition to net-zero.

The objective of the study and key findings:

The objective of the study was also to address important questions regarding India’s energy trajectory. The key questions include:

How much energy the country needs to achieve a high Human Development Index (HDI) score?
How to get there?
What energy mix projections are for this until 2070 (our declared net-zero target year)?
How much electricity will cost the end user?
How much carbon will be released until then?
What investments will be needed for energy transitions towards net-zero in 2070?
An estimate of other opportunities and challenges (RE integration, requirement of critical minerals, carbon capture, utilization and storage (CCUS), natural gas, ethanol, hydrogen); etc.
By 2070, net-zero energy cannot be achieved without significant nuclear power and the production of renewable energy (RE).
By 2070, net-zero energy systems will require the electricity industry to decarbonize well ahead of schedule.
In 2070, India’s projected emissions are expected to range from 0.56 to 1.0 billion tons of CO2.
As envisioned in our nationally determined contributions (NDCs), it is anticipated that sequestration in forestry and tree cover will offset the remaining gap in emissions.

Key stakeholders:

Dr. V. K. Saraswat, a member of NITI Aayog, expressed the need for more renewable energy penetration and the need for a transition from large reactors to Small Modular Reactors (SMRs) with industry participation. He also emphasized the need for alternative fuel options like Thorium to reduce Uranium import dependence.

Dr. A. K. Mohanty, the Chairman of the AEC and Secretary of the DAE, provided an outline of the nation’s ongoing nuclear program and its plans to increase installed nuclear capacity by 100 GW by 2047.

Prof. Ajay Sood, Principal Scientific Advisor, Government of India, in his opening remarks, stated that these pathways also need large resources to be put in place, hence, we need to synergize our efforts in various sectors.

Dr. Anil Kakodkar, former Chairman, AEC highlighted the need for the development of technologies for low-cost hydrogen production.

Besides Prof. Sood, Dr. Saraswat, Member, NITI Aayog; Dr. A. K. Mohanty, Secretary, Department of Atomic Energy (DAE) and Chairman, Atomic Energy Commission (AEC); Shri P. A. Suresh Babu, Distinguished Scientist and Director (HR), NPCIL who joined on behalf of CMD, NPCIL; Dr. (Mrs.) Parvinder Maini, Scientific Secretary, Office of PSA. Dr. Anil Kakodkar, Chancellor, Homi Bhabha National Institute (HBNI) and former Chairman, AEC was the Guest of Honour and he had joined the meeting online.

Pathways towards net-zero and the way forward:

The stakeholders observed that to implement the transition, various paths must be taken and a wide range of technologies in our energy basket must coexist. It is anticipated that coal will remain the mainstay of the Indian energy system for the next 20 years, the report notes.

The report concludes that achieving net-zero energy requires multiple paths and the coexistence of various technologies. It predicts coal will remain the mainstay for 20 years, necessitating nuclear power and renewable energy production by 2070. India’s emissions are projected to be between 0.56 and 1.0 billion tons by 2070.

The coal phase-down necessitates active policies on minerals and carbon dioxide removal technologies, while net-zero pathways, focusing on nuclear and renewable power, can provide clean, affordable electricity. The global electricity share of end-use sectors is expected to rise to 47-52% by 2020-2070, with financial requirements reaching Rs 150-200 lakh crore, with significant international financial flows.

According to the study, to implement the transition, various paths must be taken and a wide range of technologies in our energy basket must coexist. It is anticipated that coal will remain the mainstay of the Indian energy system for the next 20 years.

Any conversation on the renewable energy segment in India immediately seamlessly glides toward solar power. The reason is simple: solar currently dominates the RE segment. Today’s blog presents the scope of other alternates gaining momentum

India, the world’s fourth-largest electricity consumer and third-largest renewable energy producer, installed 40% of its energy capacity in 2022 from renewable sources.

As of November 2023, India’s installed non-fossil fuel capacity increased 396% in the last 8.5 years, accounting for 44% of the country’s total capacity.

WriteCanvas discussed the importance of solar, wind, and hybrid power in India’s renewable energy sector in a previous blog post. We now focus on the developments and prospects in nuclear, waste-to-energy, biogas, and other alternative energy sources.

Nuclear power:

India’s installed power capacity currently stands at 405GW and is projected to reach 810 GW by 2030. Twenty-two operational nuclear power reactors with a cumulative capacity of 7.48 GW account for about 1.7 percent of India’s energy mix.

Largest plant: The Kudankulam Nuclear Power Plant (KKNPP) is India’s largest nuclear power station, located in Tamil Nadu’s Tirunelveli district. Construction began in 2002 but faced delays due to local fishermen’s opposition. The plant is set to have six VVER-1000 reactors, with an installed capacity of 6,000 MW. Unit 1 was synchronized with the southern power grid in 2013 and has been generating electricity at its 1,000 MW limit. The original cost of the units was revised to Rs 17,270 crore, with Russia providing a credit of
Rs 6,416 crore.

Forecast: India’s nuclear sources are expected to contribute nearly 9% of electricity by 2047, helping it achieve its net zero target by 2070.

Tidal energy:

Estimates from the Indian government place the nation’s tidal energy potential at 8,000 MW. This includes around 7,000 MW in the Gulf of Cambay in Gujarat, 1,200 MW in the Gulf of Kutch in Gujarat, and 100 MW in the Gangetic delta of the Sunderbans in West Bengal.

Largest plant: In 1991, a 150 kW Pilot wave energy plant was established in Thiruvananthapuram, Kerala, marking the world’s first wave power plant using oscillating water column (OWC) technology.

Forecast: According to the estimates of the Indian government, the country has a potential of 8,000 MW of tidal energy.

Waste to energy:

India has the potential to generate 5,690 MW of power from industrial waste and MSW. However, as of May 2023, and the total number of WTE projects was 14 and the installed capacity stood at 556 MW, indicating the untapped potential of waste to energy.

Largest plants: Located in New Delhi, the Narela Waste to Energy Plant is a 24 MW biopower project. The project, developed in a single phase, is currently active.

Sangrur, Punjab is the largest biofuel production unit in India, producing 33 tonnes of compressed biogas per day. The unit will consume 1.30 lakh tonnes of straw annually, aiming to address the issue of stubble burning.

Forecast: India can harness its vast waste generation to generate 65 GW of electricity annually. Experts predict this to increase to 165 GW by 2030 and 436 GW by 2050.

Heat to energy (Thermal energy):

According to Invest India, the country’s thermal installed capacity reached 240.43 GW as of Jan 2024, with 208.18 GW from coal and the rest from lignite, diesel, and gas.

Largest plant: The Vindhyachal Thermal Power Station in Singrauli district, Madhya Pradesh is one of the coal-fired power stations
of NTPC. It is the largest power station in India, and the 9th largest coal-fired power station in the world, with an installed capacity of
4,760 MW.

Forecast: India aims to achieve 500 GW of non-fossil-based electricity capacity by 2030, with cleaner fuels accounting for 50% of the installed capacity mix.

Hydropower:

In 2022-23, hydropower accounted for 12.5 percent of power generation in India. India had about 4745.6 MW pumped storage capacity in operation in 2023 with about 57,345 MW of pumped storage capacity under various stages of investigation and construction.

Largest Hydropower:

The 2,400MW Tehri Hydropower Complex in Uttarakhand, India’s largest hydroelectric power plant, is the tallest in the country at 260.5 meters. The complex consists of the Tehri Dam, Tehri Pumped Storage Hydroelectric Power Plant, and Koteshwar Dam. The reservoir stores water for hydroelectricity generation, irrigation, and municipal water supply to various North Indian states. The project was recently approved by the Indian government, with NTPC taking over in November 2019. The Koyna Hydroelectric Project, India’s largest completed hydroelectric power plant, is located near Patan and has four dams, including the largest across the Koyna River.

Caveat: Caveat: Large hydroelectric projects have had devastating environmental impacts. The sinking of Joshimath town in the Chamoli district of Uttarakhand forced the government to review the Tapovan Vishnugad Hydropower Plant undertaken by NTPC. Environmentalists alleged that the construction of a changes the natural course of the river and dramatically also affects the flora and fauna, impacting biodiversity.

Forecast: India’s 103 GW potential is estimated to require 14.5 GW of PSP capacity by 2031-32, with 4.7 GW currently unoperated, 2.8 GW under construction, and 24 GW under study.

Small hydro power:

India has a 1.2% market share in the small hydropower sector, with an installed capacity of 4,944 MW.

Forecast: The global Small Hydropower market, valued at $2185.63 million in 2020, is projected to reach $2826.05 million by 2027, growing at a CAGR of 3.93% between 2021 and 2027.

Hydrogen:

India launched the National Green Hydrogen Mission in 2021 to create a Green Hydrogen ecosystem in the country.

Largest plant: The Pudimadaka Green Hydrogen Hub aims to establish a global ecosystem for new energy technologies, including electrolyzer and fuel cell manufacturing, startup, incubation, testing, and production of green hydrogen and its derivatives. The project involves the construction of India’s largest green hydrogen production facility (1200 TPA), which will be converted into green ammonia and green methanol derivatives.

Forecast: As per Green Hydrogen Mission, India’s Green Hydrogen production capacity is expected to reach 5 MMT annually, generating 125 GW of renewable energy capacity, generating Rs. 8 lakh crore in investments, and creating over 6 lakh jobs by 2030.

Our take:

India aims to achieve 500 GW of renewable energy capacity by 2030, with 424 GW of power generation capacity, 180 GW from non-fossil fuels, and 88 GW in the works.

Notably, the government has been regularly launching policies to support the segment. But some moot questions remain:

How affordable is the RE alternative at the present price point?
Does India have a robust infrastructure in place to support our ambitious targets?
How environmentally friendly really is renewable energy?
Is there a proper monitoring agency in place to scrutinize the progress of the projects?
What is happening with the feedback files? Is anyone acting on it or are they gathering the proverbial dust?
How are we benchmarking the success/failure of a project?

Being an active stakeholder in the sustainability segment, WriteCanvas is by no means a naysayer. We admit that India has come a long way in the RE segment, and is ahead of the curve vis-a-vis many of our peers.

What makes the RE environment interesting in the country is active public-private partnerships–these allude to stakeholder accountability. Several RE conferences in the country and India pavilions in similar events abroad certainly show that we are moving in the right direction.

Reader, what do you think can be done to not just fast-track the adoption of RE in the country, but also ensure transparency at all levels?

S&P Global has launched Power Evaluator, a new evaluation tool to deliver deep insight into the true value of asset investments in the power sector. The tool allows users to conduct custom valuations of existing and planned power plant assets, simulate the impact of plant acquisitions and divestments, track portfolio progress to Net Zero goals, and quantify physical and market risks to the US power plant fleet.

Power Evaluator is an innovation of S&P Global Commodity Insights and powered by data from across S&P Global, including power plant assets from S&P Global Commodity Insights, physical and climate risk datasets from S&P Global Sustainable, and ownership data from S&P Global Market Intelligence.

Philippe Frangules, Global Head of Gas, Power & Climate Solutions, S&P Global Commodity Insights, said, “With the introduction of the Inflation Reduction Act, we are seeing an unprecedented interest among market participants to invest in renewable energy and achieve net zero goals. Power Evaluator gives clients the ability to examine, simulate, and track the power landscape from a macro and micro view with an unparalleled range of data, which enables them to make decisions with conviction.”

The new tool is designed to assist investors, renewable developers, power producers, and anyone wanting an edge in understanding the power sector and its path toward a lower-carbon future. With its unique cross-S&P Global data sets, Power Evaluator not only provides unparalleled insights into the energy sector, but it can also help accelerate deal flow and better enable users to measure performance against key sustainability categories.

Power Evaluator offers users customizable metrics and maximum flexibility to achieve their firm’s strategic priorities. Core benefits include its key offerings of:

Multiple price-forecast scenarios
Machine-learning-powered nodal forecasting capabilities
Adjustable operational, financial, and tax assumptions for each asset
Quantifiable physical risks and weather metrics

“Leveraging machine learning technology, the tool brings together billions of interconnected pieces of data like no other product available to provide unique insight into the power sector and allow for real-time customization,” said Stan Guzik, Chief Technology Officer and Head of Customer Applications, S&P Global Commodity Insights.

Power Evaluator is available to customers via the S&P Capital IQ Pro platform, which is the market-leading provider of insights and data on the global energy sector, covering over 4,300 public and almost 200,000 private energy companies worldwide. Power Evaluator on Capital IQ Pro offers expanded workflow capabilities to clients, allowing them to conduct more in-depth research, enhanced assessment of power markets, and financial analysis with more efficiency.

The Union Minister for Power and New & Renewable Energy, Mr. R. K. Singh has said that round-the-clock renewable energy will cost about Rs. 6 per unit if green hydrogen is used for storage.

Speaking at the special ministerial session of the Fourth International Conference & Exhibition on Clean Energy in New Delhi, Mr. Singh said that the cost of green hydrogen would be cheapest in India and that it would become a viable energy storage alternative.

“”Green hydrogen is less expensive than gas and battery-based energy storage technologies. We have developed a pilot bid for approximately 100 MW that we hope will serve as the standard. All supply chain issues, including the availability of lithium-ion batteries, will be resolved once we are able to use green hydrogen for our energy needs. Green hydrogen will be produced and used as storage. If our cost for 24/7 renewable energy comes to Rs. 6 per unit—below the recent average price of power in the energy exchange of Rs. 8—we will be profitable. India has the potential to become a global champion in renewable energy,” he said.

Enablement:

1. Policy:
The minister stated that the government is considering allowing the industry to obtain carbon credits for green hydrogen and green ammonia that are exported from India. He informed that the basic legal framework for the carbon market to provide competitive advantage to the industry.

“We have been leading with policy papers, rules and regulations, opening new doors. We came with Green Open Access Rules, where we have given right for anybody to set up capacity anywhere and transfer it to wherever they want. I have written to all industry captains to switch over from thermal to renewables, this shift will also bring down price of energy,” he said.

2. Manufacturing:
India is emerging as a manufacturing powerhouse of renewable energy, said the minister.

“Around 88,000 MW renewable energy capacity is under construction and our plan is to add 50,000 MW of renewable energy capacity every year. We are already emerging as an exporter. The world will come to rely on us. So, all those who are setting up capacity have made a good bet. At the same time, we need to keep ourselves at the leading edge of technology,” Mr Singh said.

“We need energy demand as fast as possible to meet this demand. We will make the electricity required for our growth. If our price for round-the-clock renewable energy is anything to go by, then we will not have to go the thermal way, we will adopt the renewable path. About 42% of our capacity is from renewable sources already.”

3. Investments:

Mr Singh noted that this is the era of huge growth for the renewable energy.

Stating that more countries and corporates are investing in the renewable energy sector in the country, he said, “UAE wants to invest here. Getting investment for green transition is not an issue, since we have de-risked the system and made the whole system transparent. Each generator’s power bills are up-to-date. Legacy dues of discoms have been reduced to less than half, and this too will be wiped out in next 2 – 3 years. Every genco is now profitable. AT&C losses have come down and the system is totally viable now. Everything has been made conditional on prudential norms.”

4. National Green Hydrogen Mission:
The minister informed that 5.8 million tons of green hydrogen at various stages of capacity is already being set up, under the National Green Hydrogen Mission.

“We will be the biggest exporter since our green hydrogen and green ammonia cost is going to be the lowest in the world. And we will come up with another bid for grid scale storage. Future Renewable Energy Purchase Obligations are going to be issued under the revised Energy Conservation Act.”

Tag: RE

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