“As industries increasingly rely on variable renewable energy, they will expect high levels of reliability,” said Dan Travers, co-founder of Open Climate Fix. “High-quality forecasting will be essential to optimise storage and keep costs in check.”
Policy and market enablers
India’s Green Energy Open Access Rules 2022 have fueled this shift, enabling industries to procure RE directly, though state-level variations in charges like cross-subsidy surcharges (₹0.5-2/kWh) pose challenges. “Policy and institutional barriers must be dismantled to maximise this transition,” said Labanya Prakash Jena, sustainable finance consultant at IEEFA.
Green tariffs, offered by distribution companies (DISCOMs), could bridge the gap to 24/7 RE. “Green tariffs have the potential to transform DISCOMs’ role,” the report suggests, noting their ability to aggregate RE supply and simplify procurement. Yet, premiums of ₹0.2-1/kWh and uncertainty in pricing remain hurdles.
Global stakes and local gains
Decarbonisation also unlocks global competitiveness. The EU’s Carbon Border Adjustment Mechanism (CBAM), set for 2026, could raise steel export costs by ₹60-80/tonne and aluminum prices by 30% for Europe-bound shipments (3-4 MTPA steel, 0.7 MTPA aluminum). RE adoption aligns with India’s Green Steel Taxonomy (December 2024), enabling steelmakers to hit 3-star (2.0-2.2 t-CO2e/tfs) or higher ratings, enhancing market access. “Reducing carbon intensity can unlock new international markets and partnerships,” the report notes, citing early movers like Kalyani FeRRESTA and Shree Cement. Locally, states like Odisha and Chhattisgarh could attract climate finance, cementing their status as green hubs.
While 24/7 RE remains costly, the report pegs 80% RE as a “realistic near-term target” for committed industries, balancing cost (₹3.5-4/kWh) and decarbonisation. “Renewables are already a cost-effective solution today, and 24/7 clean power is the benchmark for the future,” said Killian Daly, Executive Director of EnergyTag.