FACULTY OF LAW

JAMIA MILLIA ISLAMIA

TOPIC OF RESEARCH: “RENEWABLE
ENERGY SOURCES AND POLICIES IN INDIA”

SUBMITTED TO: PROF. DR. EQBAL HUSSAIN

FACULTY OF LAW
JAMIA MILLIA ISLAMIA

SUBMITTED BY: SHARDENDU PANDEY

SEMESTER X
REGULAR
ROLL NO. 51

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 TABLE OF CONTENTS

ABSTRACT…………………………………………………….……………..5

HYPOTHESIS…………………………………………………..…………….6

RESEARCH METHODOLOGY………………………………..…………...6

LITERATURE SURVEY…………………………………….….…………....6

4. RESEARCH QUESTION……………………………………..……………7

1. INTRODUCTION………………………….…………………………...…..8

II. RENEWABLE ENERGY IN INDIA ……………..………………...…9-12

2.1 BIOMASS

2.2 HYDROPOWER

2.3 WIND ENERGY

2.4 SOLAR ENERGY

2.5 GEOTHERMAL ENERGY

III. OTHER RENEWABLE ENERGY TECHNOLOGIES…,,……….13-14

IV. RENEWABLE ENERGY POLICY IN INDIA……………………..15-18

4.1 RESPONSE TO THE FIRST OIL CRISIS

4.2 RESPONSE TO THE SECOND OIL CRISIS

4.3 A SEPARATE MINISTRY FOR RENEWABLE ENERGY

4.4 FINANCIAL INCENTIVES

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4.5 A NEW VISION FOR RENEWABLES

V. REGULATORY REFORMS AND POLICY INSTRUMENTS FOR

PROMOTING RENEWABLE ENERGY–BASED POWER………….19-21

5.1 NATIONAL ACTION PLAN ON CLIMATE CHANGE: FOCUS ON

SOLAR POWER……………………………………….…………………….22

VI. FUTURE OF RENEWABLE ENERGY IN INDIA…………….....23-25

VII. POLICY FRAMEWORK FOR PROMOTION OF RENEWABLES

IN INDIA………………………………………………………………….…..26

7.1 FOREIGN INVESTMENT POLICY

7.2FOREIGN INVESTMENT IMPLEMENTATION AUTHORITY (FIIA)

7.3 INDUSTRIAL POLICY IN INDUSTRIAL POLICY

VIII ENERGY POLICIES COULD GET RESET IN LIGHT OF THE

COVID-19 PANDEMIC……………………………………………...…..27-28

IX. CONCLUSION…………………………………………………………..29

BIBLIOGRAPHY…………………,,,……………………………………….30

FIELD INVESTIGATION………………………………………………31-32

ANNEXURE 1:………………………………………………………….33-39

QUESTIONNAIRE

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 ACKNOWLEDGEMENT

Firstly, I would like to express my profound sense of gratitude towards almighty for
providing me with the positive circumstances which were needed for the completion of my
project.

Secondly, I am highly indebted to, Dr.Eqbal Hussain, Faculty of Law, Jamia Millia Islamia,
New Delhi for providing me with constant encouragement and guidance throughout the
preparation of this project.

I am also thankful to my parents and friends who have supported me in the completion of this
project.

SHARDENDU PANDEY

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 ABSTRACT
In today’s date, India is a large consumer of fossil fuel such as coal, crude oil etc. The rapid
increase in use of Non renewable energies such as fossil fuel, oil, natural gas has created
problems of demand & supply. Because of which, the future of Non renewable energies is
becoming uncertain. Also India has had a negative Energy Balance for decades, which has
resulted in the need to purchase energy from outside the country to fulfill the needs of the
entire country. Even though, The Ministry of Power has set an agenda of providing Power to
All by 2014-15. This makes everyone to think, how this will be going to happen? The answer
found is presented in this paper called “Renewable Energy Sources – Policies in India” India
has a large amount of, supply of renewable energy resources & hence India has decided to
organize a program for proper utilization of renewable energy resources. As a result of which,
India is the only country in the world to have an exclusive ministry for renewable energy
development, The Ministry of Non-Conventional Energy Sources (MNES). The analysis of
need of renewable energy sources, the policies of India through MNES, Legal aspect of
Government of India about renewable energy sources, sources of renewable energy available
in India.
In India, from the last two and half decades there has been a vigorous pursuit of activities
relating to research, development, demonstration, production and application of a variety of
renewable energy technologies for use in different sectors. In this paper, efforts have been
made to summarize the availability, current status, major achievements and future potentials
of renewable energy options in India. This paper also assesses specific policy interventions
for overcoming the barriers and enhancing deployment of renewables for the future.
Keyword:-Renewable energy-Solar energy, Wind energy, Biomass energy.

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 HYPOTHESIS
The statement of hypothesis for the present research shall be that the Renewable energy
sources and the policies that has been formulated in this regard after the two oil crisis was a
much needed act in the energy system and the amendments brought to the previous acts after
the infamous oil crisis of 1970 should have been brought much earlier.

RESEARCH METHODOLOGY
The method employed is that of doctrinal research and non empirical. The methodology used
is the analysis of principles of methods, rules and postulates. Doctrinal research is concerned
with legal prepositions and doctrines. The matter of the research is collected from primary
sources such as statutes, Governement reports, etc. and secondary sources such as websites of
Government of India, and other relevant websites.

LITERATURE SURVEY
The present study is based on doctrinal research. Literature in connection with the present
study is reviewed from various sources. The primary material includes the relevant national
and international legal instruments, such as, The Electricity act,2005
The secondary sources like journals, articles, etc. have been analyzed. As the scope of the
subject is expanding with the regular output of the newspapers and online resources has been
analyzed and referred to cover all important aspects of the study. The researcher has tried to
access the sources directly but sometimes owing to non access to resources extracts of such
resources have been used and have been acknowledged.

RESEARCH QUESTIONS

The primary objective of this research purports to:

1. Analyze the renewable energy sources and policies in India.

2. To unveil the motive behind the policies formulated to govern the energy sector in India.

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3. Discuss the drawbacks of the present act and suggestions for improvement.

I. INTRODUCTION
Renewable energy sources and technologies have potential to provide solutions to the long-
standing energy problems being faced by the developing countries. The renewable energy
sources like wind energy, solar energy, geothermal energy, ocean energy, biomass energy and
fuel cell technology can be used to overcome energy shortage in India. To meet the energy
requirement for such a fast growing economy, India will require an assured supply of 3–4
times more energy than the total energy consumed today. The renewable energy is one of the
options to meet this requirement. Today, renewable account for about 33% of India’s primary
energy consumptions. India is increasingly adopting responsible renewable energy techniques
and taking positive steps towards carbon emissions, cleaning the air and ensuring a more
sustainable future. In India, from the last two and half decades there has been a vigorous
pursuit of activities relating to research, development, demonstration, production and
application of a variety of renewable energy technologies for use in different sectors. In this
paper, efforts have been made to summarize the availability, current status, major
achievements and future potentials of renewable energy options in India.
The World Energy Forum has predicted that fossil-based oil, coal and gas reserves will be
exhausted in less than another 10 decades. Fossil fuels account for over 79% of the primary
energy consumed in the world, and 57.7% of that amount is used in the transport sector and
are diminishing rapidly.1
The usage of renewable energy resources is a promising prospect for the future as an
alternative to conventional energy. Therefore, an attempt has been made through this paper to
review the availability of renewable energy options in India, and provides information about
the current status of renewable, future potentials of their uses, major achievements, and
current government policies, delivery and outreach in Indian context. It paints a remarkable
overall picture of renewable energy resources and position of India on global map in utilizing

1
International Energy Agency IEA. Key world energy statistics.
Availableat:http://www.iea.org/Textbase/nppdf/free/2006/Key2006.pdf

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these resources.2
The usage of renewable energy resources is a promising prospect for the future as an
alternative to conventional energy. Therefore, an attempt has been made through this paper to
review the availability of renewable energy options in India, and provides information about
the current status of renewable, future potentials of their uses, major achievements, and
current government policies, delivery and outreach in Indian context.
II. RENEWABLE ENERGY IN INDIA
India’s population of more than 1028 million is growing at an annual rate of 1.58%. As fossil
fuel energy becomes scarcer, India will face energy shortages significantly due to increase in
energy prices and energy insecurity with in the next few decades. Increased use of fossil fuels
also causes environmental problems both locally and globally.
For these reasons the development and use of RES & Technologies are becoming vital for
sustainable economic development of India. Expert consultation at the Asia Energy Vision
2020, organized under the World Energy Council agreed on energy demand projection in
India up to 2020.3
Energy is a basic requirement for economic development and in every sector of Indian
economy. It is thus necessary that India quickly look towards new and emerging renewable
energy and energy efficient technologies as well as implement energy conservation laws.
Against this background, the country urgently needs to develop a sustainable path of energy
development. Promotion of energy conservation and increased use of renewable energy
sources are the twin planks of a sustainable energy supply. Fortunately, India is blessed with
a variety of renewable energy sources, like biomass, the solar, wind, geothermal and small
hydropower and implementing one of the world’s largest programs in renewable energy.
The major contribution to renewable energy investment comes from private sector
participation. This is due to the support from the government, which leverages the private
investment. The financial allocation for renewable energy sources vis-a` -vis total allocation,
however, remains in the range of 0.1% during Tenth Plan period.4
Renewable sources already contribute to about 5% of the total power generating capacity in
the country. During the last two decades, several renewable energy technologies have been
deployed in rural and urban areas.5
2
World Energy Outlook. International energy agency; 2008. http://www.worldenergyoutlook.org/2008.asp.
3
Planning Commission, Govt. of India—September 1995 & September 1996 Projections to 2020–2021.
4
GOI. Tenth Five year plan 2002–2007, planning commission, New Delhi. Available at:
http://planningcommission.nic.in/aboutus/committee/wrkgrp11 /wg11_ renewable.pdf.
5
Urja Akshay. Newsletter of the Ministry of New and Renewable Energy, Government of India; October 2008.
http://mnes.nic.in/akshayurja/sept-oct2008-e.pdf

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2.1. BIOMASS
In recent years, the interest in using biomass as an energy source has increased and it
represents approximately 14% of world final energy consumption. 6 Estimates have indicated
that 15– 50% of the world’s primary energy use could come from biomass by the year 2050.
Many countries have included the increased use of renewable sources on their political
agenda. Biomass is one such resource that could play a substantial role in a more diverse and
sustainable energy mix. The energy obtained from biomass is a form of renewable energy
and, in principle, utilizing this energy does not add carbon dioxide, a major greenhouse gas,
to the atmosphere, in contrast to fossil fuels. As per an estimate, globally photosynthesis
produces 220 billion dry tonnes of biomass each year with 1% conversion efficiency.
Biomass resources suitable for energy production covers a wide range of materials, from
firewood collected in farmlands and natural woods to agricultural and forestry crops grown
specifically for energy production purposes. Energy production from food wastes or food
processing wastes, especially from waste edible oils, seems to be attractive based on bio-
resource sustainability, environmental protection and economic consideration. India is very
rich in biomass and has a potential of 16,881 MW (agro-residues and plantations), 5000 MW
(bagasse cogeneration) and 2700 MW (energy recovery from waste). 7 Biomass power
generation in India is an industry that attracts investments of over Rs. 600 crores every year,
generating more than 5000 million units of electricity and yearly employment of more than
10 million man-days in the rural areas.
2.2. HYDROPOWER
Hydropower is another source of renewable energy that converts the potential energy or
kinetic energy of water into mechanical energy in the form of watermills, textile machines,
etc., or as electrical energy (i.e., hydroelectricity generation). It refers to the energy produced
from water (rainfall flowing into rivers, etc.). Hydropower is the largest renewable energy
resource being used for the generation of electricity. Only about 17% of the vast hydel
potential of 150,000 MW has been tapped so far. Countries like Norway, Canada, and Brazil
have all been utilizing more than 30% of their hydropotential, while on the other hand India
and China have lagged far behind. India ranks fifth in terms of exploitable hydropotential in
the world. According to CEA (Central Electricity Authority), India is endowed with
economically exploitable hydropower potential to the tune of 148,700 MW.8

6
India 2009. Energy Publication Division. Ministry of Information & Broadcasting Government of India; 2009.
7
Subramanian V. Renewable energy in India: status and future prospects. Ministry of New and Renewable
Energy.
8
KPMG. India energy outlook;

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. In India, hydropower projects with a station capacity of up to 25 megawatt (MW) fall under
the category of small hydropower (SHP). India has an estimated SHP potential of about
15,000 MW, of which about 11% has been tapped so far. The Ministry of New and
Renewable Energy (MNRE) supports SHP project development throughout the country. So
far, 523 SHP projects with an aggregate installed capacity of 1705 MW have been installed.
Besides these, 205 SHP projects with an aggregate capacity of 479 MW are under
implementation. With a capacity addition, on an average, of 100 MW per year and gradual
decrease in gestation periods and capital costs, the SHP sector is becoming increasingly
competitive with other alternatives.
2.3. WIND ENERGY
Winds are generated by complex mechanisms involving the rotation of the earth, heat energy
from the sun, the cooling effects of the oceans and polar ice caps, temperature gradients
between land and sea and the physical effects of mountains and other obstacles. Wind is a
widely distributed energy resource. Total world wind capacity at the end of 2006 was around
72,000 MW. Wind energy is being developed in the industrialized world for environmental
reasons and it has attractions in the developing world as it can be installed quickly in areas
where electricity is urgently needed. In many instances it may be a cost-effective solution if
fossil fuel sources are not readily available. In addition there are many applications for wind
energy in remote regions, worldwide, either for supplementing diesel power (which tends to
be expensive) or for supplying farms, homes and other installations on an individual basis.
The availability of wind varies for different regions. Wind resources can be exploited mainly
in areas where wind power density is at least 400 W/m2 at 30 m above the ground. The Wind
Resource Assessment Program is being implemented by C-WET (Centre for Wind Energy
Technology) in coordination with state nodal agencies.
India is surpassed only by Germany as one of the world’s fastest growing markets for wind
energy. By the mid 1990s, the subcontinent was installing more wind generating capacity
than North America, Denmark, Britain, and the Netherlands. The ten machines near Okha in
the province of Gujarat were some of the first wind turbines installed in India. These 15-m
Vestas wind turbines overlook the Arabian Sea. Now, in 2008, there is an installed capacity
of 5310 MW; however, ten times that potential, or 45,000 MW, exists. Different types of
Wind Power Generators used in India for Off grip Power generation, i.e., water-pumping
windmills, aero-generators (a small wind electric generator having a capacity of up to 30 kW)
and wind–solar hybrid systems.9
9
Urja Akshay. Newsletter of the Ministry of New and Renewable Energy. Government of India; December

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2.4. SOLAR ENERGY
Solar energy is the most abundant permanent energy resource on earth and it is available for
use in its direct (solar radiation) and indirect (wind, biomass, hydro, ocean, etc.) forms. Solar
energy, experienced by us as heat and light, can be used through two routes: the thermal route
uses the heat for water heating, cooking, drying, water purification, power generation, and
other applications; the photovoltaic route converts the light in solar energy into electricity,
which can then be used for a number of purposes such as lighting, pumping, communications,
and power supply in un electrified areas. The total annual solar radiation falling on the earth
is more than 7500 times the world’s total annual primary energy consumption of 450 EJ. The
annual solar radiation reaching the earth’s surface, approximately 3,400,000 EJ, is an order of
magnitude greater than all the estimated (discovered and undiscovered) non-renewable
energy resources, including fossil fuels and nuclear. However, 80% of the present worldwide
energy use is based on fossil fuels. Most parts of India receive 4–7 kWh of solar radiation per
square meter per day with 250–300 sunny days in a year.
The MNRE, working in conjunction with the Indian Renewable Energy Development
Agency (IREDA) to promote the utilization of all forms of solar power as well as to increase
the share of renewable energy in the Indian market. This promotion is being achieved through
R&D, demonstration projects, government subsidy programs, and also private sector projects.
2.5. GEOTHERMAL ENERGY
Geothermal is energy generated from heat stored in the earth, or the collection of absorbed
heat derived from underground. Immense amounts of thermal energy are generated and
stored in the Earth’s core, mantle and crust. Geothermal energy is at present contributing
about 10,000 MW over the world and India’s small resources can augment the above
percentage. Studies carried out by the geological survey of India have observed existence of
about 340 hot springs in the hot country. These are distributed in seven geothermal provinces.
The provinces, although found along the west coast in Gujarat and Rajasthan and along a
west south west-east-northeast line running from the west coast to the western border of
Bangladesh (known as SONATA), are most prolific in a 1500 km stretch of the Himalayas.
The resource is little used at the moment but the Government has an ambitious plan to more
than double the current total installed generating capacity.

2008.available at http://mnes.nic.in/akshayurja/novdec-2008-e.pdf. last modified on 1st October 2019.

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 III. OTHER RENEWABLE ENERGY TECHNOLOGIES
Solar thermal technologies, particularly solar water heating system, solar cookers and solar
generation systems are the most commercialized technologies among renewable energy
technologies in India. Policies are set to provide further impetus to dissemination of solar
technologies. Biogas represents an alternative source of energy, derived mainly from organic
wastes. In India, the use of biogas derived from animal waste, primarily cow dung, has been
promoted for over three decades now.
Biogas is a clean fuel produced through anaerobic digestion of a variety of organic wastes:
animal, agricultural, domestic, and industrial. Biogas is the only technology that has put
cooking in rural areas on technological ladder and has made cooking a pleasure with
associated social and environmental benefits including zero indoor pollution. India’s National
Project on Biogas development (NPBD) has been one of the well organized and systematic
program to provide logistic and institutional support for that has been under implementation
since early 1980s. India Biogas program is one of the most successful program if we compare
with other such program implemented in Rural India.
Till December 2004, under the National Biogas Program, over 3.7 million biogas plants in
the capacity of 1–6 m3 had been installed.
The ultimate goal of this program is to set up biogas plants in around 12 million households
that have enough cattle to maintain a regular supply of dung. Biofuel program in the country
is at nascent stage. The policy measures currently in place include an excise tax reduction for
E-5, the obligation to blend all petrol with 5% ethanol in certain regions since January 2003
and government regulation of the ethanol selling price on the basis of ethanol production
costs. Subsequently the percentage of ethanol mixture in petrol is planned to be increase to
10%.
A new biofuel policy for the country is under construction. Hydrogen energy is also at early
stage of development. Ministry of New and Renewable Energy also funded research projects
on different aspects of hydrogen energy technology development. India is the member of the
International Partnership on Hydrogen economy (IPHE) set up in Washington, DC in
November 2003. Future challenges to India includes lowering cost of hydrogen substantially
and improve production rates from different methods, development of compact and
inexpensive storage capacity, establishment of hydrogen network and development of
hydrogen fuelled IC engine and efficiency improvement of different type of fuel cell systems.

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The road map envisages taking up of research, development and demonstration activities in
various sectors of hydrogen energy technologies and visualized goals of one million
hydrogen-fuelled vehicles and 1000 MW aggregate hydrogen based power generation
capacity to be set up in the country by 2020.10

IV. RENEWABLE ENERGY POLICY IN INDIA

The energy situation is particularly challenging in India, where more than 400 million people,
or 40 percent of the population, still do not have access to electricity and the government is
committed to providing them with universal access.11 India’s Planning Commission has
estimated that about 20,000 megawatts (MW) of new electricity generation capacity needs to
be added annually until 2020 to achieve universal access (GOI 2011, 39).12 However, on June
8, 2007, at the thirty-third summit of the G-8 in Heiligendamm, Germany, the prime minister
promised the international community that India’s per capita carbon emissions would not
exceed the average per capita emissions of the developed countries (GOI 2011, 12). In order
to meet this commitment, it is imperative for the country to use clean energy to eradicate its
acute energy poverty. A recent study estimated that India could potentially reduce carbon
emissions by 30 to 50 percent by 2030 (equivalent to 2.8 to 3.6 billion tonnes of carbon
dioxide) through the use of commercially available and feasible clean energy technologies,
including renewables (McKinsey 2009, 13).
India’s early efforts to develop renewable energy focused primarily on promoting technology,
research and development (R&D), and subsidizing demonstration projects in renewable

10
Ghosh D, Shukla PR, Garg A, Ramana VP. Renewable energy technologies for the Indian power sector:
mitigation potential and operational strategies. Renewable and Sustainable Energy Reviews 202;06:481–512.
11
In contrast, only 8 million people lack access to electricity in China.
12
It is estimated that providing universal access to electricity in India by 2030 would require a total investment
of $182 billion; providing universal access in China would require about $1 billion between 2010 and 2030
(International Energy Agency [IEA] 2010a, 24).

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energy. Later efforts focused on providing financial incentives for private sector
participation, and, more recently, there have been comprehensive legislative reforms aimed at
increasing the share of renewables in total energy consumption. The four main renewable
energy sources in India have continued to be wind, biomass, small hydro, and solar.
4.1 RESPONSE TO THE FIRST OIL CRISIS
India’s first major initiative to explore alternatives to conventional energy was driven by the
oil crisis in the early 1970s.13 High oil prices and concerns about volatile oil supplies pushed
the government to promote the use of renewable sources and engage in systematic R&D.
Solar, biomass, and wind energy were given top priority due to their large potential and their
relevance to rural energy programs (GOI 1979, 103). For example, in 1974, Central
Electronics Ltd (a public sector company) was established under the Ministry of Science and
Technology to harness indigenous solar technology commercially. With the technology for
biogas production from animal wastes well developed, efforts were made to promote its use
in rural households.14 Concerning wind power development, research had been initiated
earlier by the Council of Scientific and Industrial Research during the 1950s, and wind power
plants were already being used for pumping water in isolated locations (GOI 1961).
4.2 RESPONSE TO THE SECOND OIL CRISIS
In the aftermath of the second oil-price shock in the late 1970s, India’s sixth Five Year Plan
(1980–85) presented a clear rationale for (and increased the emphasis on) the exploitation of
renewable sources of energy: India’s endowments of energy resources are by no means large.
There are also obvious limitations to the extent to which savings in energy consumption
could be achieved through conservation. It is apparent, therefore, that if the country’s
growing demands of energy are to be met, new and renewable sources of energy must be
developed. The new energy technologies are particularly suited for the introduction of
decentralised or small scale energy supply systems which fit in with India’s rural agricultural
economy. Remote communities which cannot be reached by an electricity grid except at
prohibitive cost or do not have easy access to conventional commercial fuels could, through
renewable energy technologies, be provided more energy sources for domestic use as well as
for rural industry and agriculture. In general, these technologies have the additional merit of

13
In 1974, the Fuel Policy Committee observed that “a number of energy sources, which have not been
considered of any practical significance as sources of supply of energy to mankind, have recently acquired
importance in view of their renewability, pollution-free production possibility and more recently, the very high
increases in oil prices” (GOI 1974, 112).
14
The “biogas plant” technology was developed in India to process organic waste. Biogas is an efficient
sustainable fuel in rural areas, and it is piped for use as a cooking and lighting fuel in specially designed stoves
and lamps.

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having less adverse impact on the environment than the conventional fossil fuel systems.
Even though the immediate contribution of the new energy technologies to energy supply
may be limited and many of them are not economically competitive at the moment, there is
no doubt that they will play a predominant role in future.
To develop a more comprehensive renewable energy policy, in 1981 the government
established the Commission for Additional Sources of Energy, with the mandate to formulate
programs to develop renewable energy and intensify R&D in the sector. In 1982, a new
Department of Non-Conventional Energy Sources was established within the Ministry of
Energy.
To address the lack of energy for rural households, several projects were launched to promote
biogas, solar thermal energy utilization, solar photovoltaic, wind energy, and biomass
gasifiers . For example, improved traditional cooking stoves, or chullahs, based on renewable
energy were developed. Beginning in the early 1980s, the Ministry of Energy encouraged the
development of household-scale biogas plants in rural areas through subsidies and financing
for the construction and maintenance of biogas plants, training, public awareness, technical
centers, and support to local implementing agencies. In many parts of India, especially in
remote rural areas, supplying electricity through the power grid is not economical (and
sometimes not feasible given the terrain), and off-grid renewable energy systems are the only
solution.

4.3 A SEPARATE MINISTRY FOR RENEWABLE ENERGY

To emphasize its political commitment to renewable energy development, in 1992 the Indian
government upgraded the Department of Non-conventional Energy Sources to an
independent ministry (later renamed the Ministry of New and Renewable Energy in 2006).
This was the world’s first federal ministry committed exclusively to promoting a country’s
renewable energy. The ministry also established specialized technical institutions, such as the
Solar Energy Centre, the Centre for Wind Energy Technology, and the Sardar Sawaran Singh
National Institute of Renewable Energy, to promote renewable energy devices, training, and
testing and certification of equipment. State-level energy development agencies were also
established to provide a focal point within the states for the development, promotion, and
dissemination of renewable energy technologies (GOI 1992, para. 8.72.2). During the 8th
Five Year Plan (1992–97), solar, wind, biomass, wastes (including cattle dung, nonwoody
organic wastes, and municipal waste), and small hydro were promoted. Installation of wind
power capacity was a major focus, with a target of at least 100 MW (including private sector

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contribution) and an emphasis on domestic production of wind turbines (GOI 1992, para.
8.74.6).
4.4 FINANCIAL INCENTIVES
A range of financial incentives to promote private investment in renewable energy–based
power projects was offered by the government. Private investment incentives included tax
holidays, 100 percent accelerated depreciation, and concessional import and customs duties
on hightechnology equipment and components for wind and solar energy. 15 Funds were also
provided for technical support and projects through the Indian Renewable Energy
Development Agency (IREDA), a government agency established in 1987 to distribute
government financial support as well as soft loans from multilateral lending agencies such as
the World Bank and the Global Environmental Fund for renewable energy and energy-
efficiency projects.16
4.5 A NEW VISION FOR RENEWABLES
The new vision to meet India’s escalating energy demand was summarized in the Integrated
Energy Policy 2006 (GOI 2006), which aimed at increasing the country’s energy supply at
the least cost in a technically efficient, economically viable, and environmentally sustainable
manner. Renewable resource–based energy was identified as one of the key action items,
with the goal of making it commercially viable.7 Promotional policies were outlined for
mini-hydro, wind power, biodiesel, plantations for biofuel and fuelwood, ethanol, biogas
plants, wood-based gasifier power plants, solar thermal water heaters, solar PV, and solar
thermal power plants. The 2006 policy document observed that with concerted efforts,
renewables could account for 5 to 6 percent of India’s total primary energy by 2030 (GOI
2006). In a significant departure from the earlier policy approach, the focus shifted from mere
capacity building to outcomes, and all government financial incentives and subsidies were to
be linked with renewable energy generation, not just installed capacity (GOI 2006). However,
because special policies cannot be sustained over the long run, they were to be “for a
welldefined period or up to a well-defined limit” (GOI 2006). The goal was to make
renewable energy competitive with conventional forms of energy within two decades. Thus a
new wave of regulations and policies was implemented to pave the way for enhancing the
generation of gridconnected renewable power, with the understanding that preferential

15
For example, given India’s dependence on imported solar technology, the import tariff rates on solar PV cells
and modules have been reduced substantially over the years, with a basic customs duty of zero and an applied
tariff rate of 10 percent in 2019.
16
IREDA continues to be the nonbanking financial institution that administers the Ministry of New and
Renewable Energy’s programs.

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pricing would be phased out over time.

V. REGULATORY REFORMS AND POLICY INSTRUMENTS FOR

PROMOTING RENEWABLE ENERGY–BASED POWER
The first comprehensive legislation in the new regulatory framework for developing
renewable resource–based electricity in India was the Electricity Act 2003. It paved the way
for the building of captive renewable power plants (i.e., independent power generation for
own use) and third-party sales, and it created specific policy instruments, including
preferential tariffs or feedin tariffs,17 renewable purchase obligations (RPOs), and tradable
renewable energy certificates (RECs). The Electricity Act mandated the State Electricity
Regulatory Commissions (SERCs) to promote grid connectivity of electricity generated from
renewable sources through tariff regulations (Sect. 61h) and to specify a minimum purchase
obligation of renewable power (Sect. 86.1.e).
The effort to commercialize renewable electricity was reinforced by the National Electricity
Policy 2005, which also encouraged cogeneration facilities and a progressive increase in
distribution companies’ purchases of electricity from cogenerators through a competitive
bidding process (Sect. 5.12.3). Subsequently, the National Tariff Policy 2006 provided
guidelines to the SERCs for fixing minimum RPOs at the state level, which were to be based
on regional availability of resources and the RPOs’ impact on retail tariffs (Sect. 6.4(1)). The
National Tariff Policy also stipulated that purchases of electricity by distribution companies
would be at preferential tariffs as determined by the SERCs, although in the longer run
renewable energy would have to be competitive with other sources in terms of full costs
(Sect. 6.4 (2)).
Under the provisions of the National Tariff Policy, the Central Electricity Regulatory
Commission (CERC) sets annual feed-in tariffs for grid-connected power from different
renewable sources to ensure “returns with full cost recovery during debt repayment period for
full useful life” (CERC 2010, 27), that is, equivalent to a levelized tariff. For solar power
projects, the tariffs are differentiated by technology (PV and thermal); for other renewable
forms (small hydro and wind), the tariffs vary by state and capacity. The feed-in tariffs are
several times higher for solar power than for power from wind, small hydro, and biomass
because solar continues to be the most expensive technology. Based on the states’ renewable
17
A feed-in tariff for electricity produced from renewable energy sources is the assured cost-based
compensation paid to the generator for supplying power to the grid. Feed-in tariffs are set by the regulatory
boards as an incentive to promote renewable energy–based power (e.g., wind, biomass, solar) until these sources
become commercially viable.

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energy potential and the impact of a feed-in tariff, the CERC has projected that a total
renewable capacity of 45 GW can be achieved by 2015, and that the electricity generated
from that renewable capacity would allow the country to achieve an overall RPO of 10
percent (MNRE 2011).
5.1 NATIONAL ACTION PLAN ON CLIMATE CHANGE: FOCUS ON SOLAR
POWER
Although efforts to develop solar technology and harness solar energy began in the 1970s,
solar power had failed to take off in India, with only 601 kW of grid-connected solar PV
capacity installed by 1992 (Department of Non-Conventional Energy Sources [DNES] 1992,
and 2.12 MW by the end of 2007 (MNRE 2008). Thus it was clear that despite the various
financial instruments and incentives for private investment, the solar energy sector was not
developing as expected and further action was needed.
In 2008, the prime minister’s office announced the National Action Plan on Climate Change
(NAPCC 2008) as part of a comprehensive policy to mitigate climate change and move India
toward a low-carbon sustainable growth path. The NAPCC was launched a year after the
prime minister’s announcement that India’s per capita carbon emissions would not exceed the
average per capita carbon emissions of the developed nations. The NAPCC outlined eight
national policies, including one aimed exclusively at solar energy—known as the National
Solar Mission (formally the Jawaharlal Nehru National Solar Mission)—since solar is a zero
emission energy form. The NAPCC seeks to increase the share of solar energy in the total
energy mix, but it also recognizes the need to further expand the scope of other renewables
such as wind and biomass. To ensure sustained demand for grid-connected renewable-based
power, the NAPCC proposed “a dynamic minimum renewable purchase standard” of 5
percent of the grid’s total purchases for 2009–10, which would increase by 1 percent each
year for ten years (NAPCC 2008, 44), implying that by 2020 India would be producing 15
percent of its electricity from renewable resources.18
The National Solar Mission was officially launched in January 2010. The goal is for solar
power to achieve parity with coal-based thermal power by 2030 and overall grid parity by
2020,19 by making solar power commercially viable over the next two decades, so that
investors no longer face technical or financial constraints. The goal for 2030 is 100 GW of

18
The benchmark capital cost norm for solar power projects is set by the CERC. For example, in 2010, the
benchmark capital cost norm was set at US$ 338 million per MW for solar PV power projects and US$ 316
million per MW for solar thermal power projects (CERC 2010: 61).
19
The mission plans to achieve its goals over three time periods: phase I (2009–12), phase II (2012–17), and
phase III (2017–20).

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solar capacity, which would constitute 10 to 12 percent of total power generation, and the
interim capacity goal is 20 GW by 2020 (NAPCC 2008).
Solar power remains far more expensive than coal-based power, but there is optimism that
“with growing manufacturing capacity in the country, short term viability gap support from
government, aggressive research and development, [and] large scale deployment, the cost
could come down to grid parity within the coming decade”20
VI. FUTURE OF RENEWABLE ENERGY IN INDIA
India, faced with twin challenges on energy and environmental front, has no option but to
work towards increasing the role of renewable in the future energy systems. Renewable
energy technologies vary widely in their technological maturity and commercial status. In
India, renewable energy is at the take-off stage and businesses, industry, government and
customers have a large number of issues to address before these technologies could make a
real penetration. India with large renewable energy resources (solar PV, wind, solar heating,
small hydro and biomass) is to set to have large-scale development and deployment of
renewable energy projects.21
The aim of meeting 10% of the country power supply through renewable by 2012 and also
ambitious plans for the distribution of biogas plants, solar PV applications and solar city
appears to be within reach. Moreover, introduction of tradable renewable energy certificates
(REC) could overcome the existing gap that is hindering the application of quota for
renewables and thereby creates a vibrant market. India would also have to look for
international cooperation in renewable energy through well defined R&D projects with
proper division of labour and responsibilities for specific tasks with equitable financial
burden and credit sharing arrangements. Renewable energy development is considered in
India to be of great importance from the point of view of long term energy supply security,
environmental benefits and climate change mitigation.
The Integrated Energy Policy report has recognized the need to maximally develop domestic
supply options as well as the need to diversify energy sources. The Committee has placed
emphasis on higher use of renewables in all forms of services. It is expected that the
contribution from renewables in power generation alone can be of the extent of 60,000 MW
in the year 2031–2032. By 2031–2032 renewables will be the key driver in social inclusion of
the poor in the development process. A modest assessment of investments in the renewable

20
The proposed tariffs are Rs10/KWh or US$0.22/KWh for the first three years, with reviews in subsequent
years.
21
Maithani PC. Renewable energy policy framework of India. India: Narosa Publication Delhi; 2008. p. 41–54.

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energy sector will be about Rs. 300,000 crores over the next 25 years. MNRE has included in
its mission: energy security; increase in the share of clean power; energy availability and
access; energy affordability; and energy equity.22
A number of government and private organizations such as MNRE, Centre for Wind Energy
Technology, Universities, IITs, NITs, Indian Oil Corporation Ltd. (IOCL) and The Energy
Resource Institute (TERI) are involved in R&D of renewable energy sources.
VII. POLICY FRAMEWORK FOR PROMOTION OF RENEWABLES
IN INDIA
The policy framework is the key to the success of renewable energy in any country. Policies
aim at overall development and promotion of renewable energy technologies (RETs) and its
applications. Policy initiatives encourage private sector to take part in renewable business as
per provision of fiscal and financial incentives for a wide range of renewable energy (RE)
programmes. Policies are largely financial, fiscal incentives or special directives aimed to
encourage or enforced utilities to buy RE power, promoter companies to set up RE projects,
equipment companies to manufacture RE equipment or private and government entities to
undertake R&D relating to RE. In India, policy initiatives encourage domestic private
investments with a provision of fiscal and financial incentives such as tax holidays,
accelerated depreciation and duty rebates. At the central level, policy measures are
administered through the Ministry of New and Renewable Sources (MNRE). The state
governments contribute by making available infrastructural facilities for wheeling of power
and buying power from renewable units.23 A comprehensive RE Policy for all-round
development of the sector, encompassing all the key aspects, has been formulated by MNRE.
The broad objectives envisaged in the draft policy are as meeting the minimum energy needs
through RE, Providing decentralized energy supply in agriculture, industry, commercial and
household sectors in rural and urban areas, and providing grid quality power. The policies
targeting of 10% of additional grid power Generation capacity to come from RE by 2012. 24
Some of the policies and fiscal incentives in India for renewable energy developments are
discussed in later sections.
7.1 FOREIGN INVESTMENT POLICY Foreign investors can enter into a joint
venture with an Indian partner for financial and/or technical collaboration and for

22
Chaturvedi P, Garg HP. Financing renewables—emerging dimensions. IREDA NEWS; July–September 2019.
http://www.ireda.in/pdf/July-September_ 2020.pdf.
23
Sustainable Energy Future by AD2030 - India Case Study
24
Government of India · National Knowledge Commission Science and Environment, “Policies for renewable
energies/biomass in India”

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 setting up of RE-based power generation projects. Proposals for up to 100 per cent
foreign equity participation in a joint venture qualify for automatic approval and with
this 100% foreign investment as equity is permissible with the approval of the Foreign
Investment Promotion Board (FIPB). The Government of India encourages foreign
investors to set up RE-based power generation projects on Build, Own and Operate
(BOO) basis.25 Government also encourages foreign investors to set up power projects
based on other nonconventional energy sources also. Investors are required to enter
into a power purchase agreement with the concerned state government. 26No prior
approval of the government is required to set up an industrial undertaking with
Foreign Direct Investment (FDI) by Non-Resident Indians (NRIs). The Reserve Bank
of India (RBI) has permitted Indian companies to accept investment under the
'automatic route' without obtaining prior approval from RBI to set up such renewable
based projects.27
7.2 FOREIGN INVESTMENT IMPLEMENTATION AUTHORITY (FIIA)
The FIIA has been set up in the Ministry of Commerce and Industry to translate FDI
approvals and implementations. It is headed by the Secretary (Department of Industrial
Policy & Promotion) and is serviced by the SIA. FIIA would provide a one-stop after-
care service to foreign investors by helping them to expedite approvals and clearances
and to sort out operational problems with other government agencies. It will act as a
single-point interface between the investors and government agencies including
administrative ministries, state governments, Pollution Control Boards, Directorate
General of Foreign Trade, regulatory authorities, tax authorities and Company Law Board
among other and the approval holders have been requested to get in touch with respective
officers in FIIA Hence the provisions in FIIA are directly or indirectly linked with
renewable promotion.28
7.3 INDUSTRIAL POLICY IN INDUSTRIAL POLICY, MNRE is promoting medium,
small, mini and micro enterprises for manufacturing and servicing of various types of RE
systems and devices. For setting-up of an RE industry, industrial clearances as well as no
clearance is required from Central Electricity Authority (CEA) for power generation projects

25
Ghosh Debyani, Shukla P.R., Garg Amit and Ramana P.V, “Renewable energy strategies for Indian April
2009, power sector,” [Online]. Available Source: http://www.decisioncraft.com
26
Indian investment center, “Foreign Direct Investment Policy & Business Opportunities”.
27
Laxman Kumar Behera, “India Needs a Liberal FDI Policy for its Defense Industry,” January 2018, [Online].
28
The Financial Express, “India seeks FDI in renewable energy SEZ,” Jun 27 2008 [Online], Available
http://www.financialexpress.com.

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up to Rs 1,000 million.29 For RE power generation projects government is allowed five year
tax holiday and for RE equipment manufacturing, Soft loans are available through IREDA
.Financial support is also available to RE industries for R&D projects in association with
technical institutions. Private sector companies can set up enterprises to operate as licensee or
generating companies. Customs duty concession is available for RE spares and equipment,
including those for machinery required for renovation and modernization of power plants.
They are also expected to convey the government's decisions on applications filed and for
assisting entrepreneurs to set up projects and monitoring implementation.30

VIII. ENERGY POLICIES COULD GET RESET IN LIGHT OF

THE COVID-19 PANDEMIC
While India should prioritise health and economic recovery in the aftermath of the COVID-
19 crisis, there will also be an opportunity for clean energy transition as part of coping
strategies and support measures, says a latest report which examines India’s energy policies.
Though it is yet uncertain how long the pandemic will last, the report anticipates an increased
focus on economic recovery once it is under control, which includes addressing concerns of
the energy sector. The period post COVID-19 will give the Indian government a chance to
reset its energy policies and increase focus on clean energy, notes the report released on April
16. If India considers economic stimulus to support energy producers it should “carefully
assess” how different interventions for producers will “undermine or support the clean energy
transition,” it says.
The report ‘Mapping India’s Energy Subsidy 2020: fossil fuels, renewables, electric vehicles’
has been prepared by two think tanks working on environmental issues – the International
Institute for Sustainable Development (IISD) and the Council on Energy, Environment and
Water (CEEW).
It highlighted that though the overall support for fossil fuels has been decreasing, there is still
a significant gap between usage of fossil fuels and renewable energy, with the latter left to
cover a lot more ground to match up to fossil fuel usage. It also revealed that subsidies for
fossil fuels are still over seven times more than subsidies for alternative energy in India. “In
(financial year) FY 2019, subsidies for oil, gas and coal amounted to Rs. 83,134 crore (USD
12.4 billion), compared to Rs. 11,604 crore (USD 1.7 billion) for renewables and electric
29
Ministry of New and Renewable Energy source (MNRE) “Policy support for grid interactive renewable
power,” [Online]. Available: http://mnes.nic.in.
30
MNRE, “Review of government of India policies for promotion of renewable and biomass energy utilization
in India,” [Online]

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mobility,” said the report.
While talking about how India’s energy subsidies might change in response to the COVID-19
crisis, the report said: “it is hard to predict the full impacts of COVID-19, but it seems likely
they will be significant and prolonged,” and that “clean energy transition can and should be
reflected in coping strategies and support measures”. 
While acknowledging that the impacts of the pandemic are likely to be “significant and
prolonged,” the report stressed that there are three key implications for public resources and
energy transition in India, in the post-pandemic recovery phase – a crash in world oil prices
can free up revenue to help tackle the crisis by temporarily eliminating petroleum product
subsidies and enabling higher tax rates, increasing demand to support energy producers, as
profits fall, demand falters and perceptions of risk rise as well as an increasing demand for
social protection and effective and efficient public services. 
“On the other hand, the current COVID-19 crisis has shown the world what one crisis could
do to health, economy and livelihood. It has also shown us the importance of investing in
public health. The best investment that the governments should focus on when they revive the
economy is in the clean and renewable energy sector and not to focus on fossil fuel sources
which cause the most damage to public health and the climate,” said Dahiya.
The report also talked about subsidies provided in the form of under-priced electricity and
highlighted that “state-level under-priced electricity is the most costly individual subsidy
policy in India estimated at Rs 637.78 billion (Rs 63,778 crore).”
“India’s energy sector is full of price distortions and on account of poor targeting of
subsidies, the rich ultimately end up benefiting disproportionately. For instance, LPG
consumption is concentrated more in urban areas than in rural areas, thereby serving the
needs of the wealthier section. Similarly, on the electricity front, the focus of the government
is only in keeping the wheels greased and not an overhaul to address the inefficiencies in the
system,” said Ganesan while explaining that the subsidies provided masks losses linked to
specific consumer groups.
The report stressed that the support for coal power largely remains unchanged and talked
about the associated cost of the coal power. it explained that the net costs of coal are much
larger than the revenues if we compare total revenues from coal taxes and total costs from
coal-related subsidies, air pollution and greenhouse gas (GHG) emissions.

IX. CONCLUSION

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Energy security, economic growth and environment protection are the national energy policy
drivers of any country of the world. The need to boost the efforts for further development and
promotion of renewable energy sources has been felt world over in light of high prices of
crude oil. A critical part of the solution will lie in promoting renewable energy technologies
as a way to address concerns about energy security, economic growth in the face of rising
energy prices, competitiveness, health costs and environmental degradation. According to
NAPCC other sources of renewable energy would be promoted. Specific action points that
have been mentioned include promoting deployment, innovation and basic research in
renewable energy technologies, resolving the barriers to development and commercial
deployment of biomass, hydropower, solar and wind technologies, promoting straight (direct)
biomass combustion and biomass gasification technologies, promoting the development and
manufacture of small wind electric generators, and enhancing the regulatory/tariff regime in
order to main stream renewable energy sources in the national power system. Accordingly,
increased focus is being laid on the deployment of renewable power that is likely to account
for around 5% in the electricity-mix by 2032. Alternate fuels, essentially bio-fuels, are
proposed to be progressively used for blending with diesel and petrol, mainly for transport
applications. Finally, renewable energy provides enormous benefits and can contribute
significantly in the national energy mix at least economic, environmental and social costs and
it is expected that the share of renewable energy in the total generation capacity will increase
in future.

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 FIELD INVESTIGATION AND OBSERVATIONS
For the field investigation relating to the research, the researcher prepared a questionnaire
consisting of 11 Questions (Questionnaire attatched herein as Annexure 1). The people
surveyed consisted of total of 104 people including students of law, commerce and other
fields as well. Some working professionals were also part of the survey. All the people
surveyed were aware of the research topic i.e.Renewable energy sources and policies in India.

Out of 104 people surveyed 56.7% agreed that renewable energy sources and technologies
are the potential solution to the long standing energy problems faced by India. While 11.5%
of the surveyed people were of neutral opinion.
50% of the surveyed people agree to the fact that the growth of renewable energy has
changed the demography of India’s energy business.

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The conclusion of this survey reflects that majority of people i.e. 86.8% people believe that
we still haven't achieved the prime objective of the government policies that are formulated
to govern the energy sector of India. We still need to go a long way to meet our energy needs.
Going through all the data available along with questionnaire and other data the research
hypothesis seems to be agreed to by the majority.

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 BIBLIOGRAPHY
PRIMARY SOURCES:
ACTS
1. The Electricity Act, 2003.
2. The Energy conservation bill -2000
3. The Renewable Energy promotion bill- 2005.

SECONDARY SOURCES:
WEBSITES
 Centre for Wind Energy Technology available at www.cwet.tn.nic.inenda of providing
Power to All by 2014-15(last visited on May 27,2021)..
 A. Kumar, A. Garg, S. Kriplani and P. Sehrawat, “Utilization of Geothermal Energy
Resources for Power Generation in India: A Review,” 7th Internal conference &
Exposition on Petrolium Geophysics, Hydrabad 2008,p-290(last visited on May 27,2021).
 Renewable energy in India 2013,Indo-German energy forum,
http://energyforum.in/newsletter.html?file=tl_files/downloads/PDF
%20News/RENEWABLE%20ENERGY%20IN%20INDIA%202013.pdf (last visited on
May 27, 2021).

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QUESTIONNAIRE

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