Power Grid is India’s Central Transmission Utility, and is responsible for
distributing power in the country. It manages the national and regional
grid networks in India, and provides electricity both within and across
regions, operating as the backbone of Indian electricity infrastructure.
India has ambitious targets for renewable energy in the longer term,
targeting 175 Gigawatts (GW) of installed capacity by 2022 and 450 GW
by 2030. To achieve the latter target, the country needs to install 36 GW
of renewable energy capacity per year, up from the current run rate of
around 9.4 GW in 2019-2020.
It has been estimated that the addition of 60 GW of wind and 100 GW of
solar power generating facilities, as part of the 175 GW target, would
reduce carbon dioxide emissions by 21% (280 million tonnes) versus a
scenario in which none were installed.
One hurdle to achieving this goal is the transmission network, and the
need for smarter infrastructure to draw renewable energy from areas of
abundant generation to those of high demand. As with most countries,
renewable energy supply is unevenly distributed across India’s various
states. This means that additional transmission lines are required to
move this electricity between and within states. On top of this, the grid
needs upgrading to manage the less-stable nature of renewable energy.
Power Grid is playing a central role in the distribution of renewable
energy in India, developing the infrastructure to facilitate greater
penetration, including a lead role in the development of a green corridor
project, a dedicated transmission network for the sector.
While investment opportunities in renewable energy are often thought
to be mainly related to solar and power generation, we deeply consider
the broader changes that need to happen to facilitate the greater
adoption of renewable energy as part of the Company’s climate change
research. This helps to recognise the investment merits of a transmission
company, given the growth in such infrastructure required in India.