India plays an important role in Al Gore’s new movie, An Inconvenient Sequel: Truth to Power. The film looks at India to highlight the challenges developing nations face as they seek to move away from conventional, polluting coal energy toward clean but less established sources of renewable energy. Much of the movie was filmed in 2015, when India was portrayed in Western media as being a holdout in the Paris climate negotiations.
Spoiler alert: India, the world’s 4th largest carbon emitter (after China, the U.S. and the EU), does indeed sign on to the Paris treaty. And what’s more, India is on track today to meet and even exceed the ambitious climate goals set at Paris. In the scant two years since the film wrapped, India has made tremendous progress shifting away from coal and toward renewables, fueled by ambitious goal-setting and supportive government policies. What’s crucial now is developing the financial infrastructure to fund small-scale projects and newer technologies to ensure that clean, renewable power reaches India’s rural areas.
The overall growth of renewable energy in India has been remarkable. India has added 9 gigawatts (GW) of solar power in just the past two years—the equivalent of 4.5 Hoover Dams—for a total of 12 GW of total solar power capacity. Solar capacity has increased 370 percent in the past three years. According to an analysis by Bloomberg New Energy Finance (BNEF), another 37 GW will be added by 2020. India commissioned 3.6 GW of wind power in 2016 and doubled that in the first quarter of 2017 alone.
This boom in clean energy has led to a slowdown in the growth of coal. Several Indian states have recently scrapped plans to build new coal-fired power plants and announced the cancelation of coal mining projects. BNEF projects that by 2040, coal will no longer play a dominant role in India’s power system.
Much of India’s projected clean energy growth is expected to come from large-scale projects such as solar parks. But India also needs to ramp up small scale energy development, such as rooftop solar, in order to reach some 300 million people who are not connected or are underserved by the power grid.
Many small towns and villages only get electricity for a few hours a day, if at all. People rely on wood, coal or gas for lighting and cooking. This creates carbon emissions as well as unhealthy smoke at home—pollution that particularly affects women and children.
The government has set a goal of installing 40 GW of rooftop solar and electrifying 18,000 villages by 2022. But right now these types of small-scale, off-grid projects don’t have the same access to capital that big projects like solar parks do. This needs to be remedied. The ability to warehouse and bundle small projects together would make it easier for banks to service loans and create a scale that’s more attractive to private and international investors. A dedicated green investment fund with ring-fenced, patient capital and clean energy expertise could provide this and other solutions to help finance underserved projects such as rural solar energy development, as well as newer technologies like electric vehicles and solar batteries, where financiers have less experience lending.
With all the drama in the United States, it’s easy to forget that most countries are still moving forward on climate, honoring their commitments at Paris and even, like India, on track to exceed their climate goals. NRDC is working with partners in India to help remove barriers to clean energy financing so that India can continue to cut carbon pollution while providing energy to everyone who needs it.
Frances Beinecke is the immediate past president of the Natural Resources Defense Council and a strategic advisor the NRDC India Program.