B.B.A., L.L.B. (Hons.

) / Third Semester- 2021

MANAGEMENT III

Topic: PRESENT AND FUTURE IMPACT OF COVID-19 IN THE

RENEWABLE ENERGY SECTOR IN INDIA

Submitted To: Prof. Shweta Soman

Submitted by: Anoushka Sud (F003)

Sap Id: 81022019327

1|Page
 INDEX

SR. NO. PARTICULARS PAGE NO.

1.
ABSTRACT 3
2.
RESEARCH METHODOLOGY, 4
LIMITATIONS, HYPOTHESES
3.
INTRODUCTION 5
5.
REVIEW OF LITERATURE: PRESENT 7
6.
FINANCIAL IMPACT 9
7.
FUTURE IMPACT 11
8.
CONCLUSION 14
9.
REFERENCES 16

ABSTRACT

2|Page
The emergence of the Corona virus Disease (COVID-19) near the end of 2019 and its subsequent
transformation into a global pandemic sent shockwaves throughout the world. It claimed the
lives of not only individuals, but also of numerous industries and governments as a whole. Many
countries have resorted to country-wide lockdowns to prevent the spread of the disease,
jeopardising the normalcy of their economies. During this time, the global economy has reached
new lows in the trillions of dollars, causing constant anxiety about the future. The renewable
energy sector, which has always been one of the leading areas to promote environmental
sustainability, is also affected by the pandemic. The combination of the pandemic's effects on the
global economy and fluctuating oil prices caused by country-wide lockdowns around the world
exacerbated the pandemic's impact on the renewable energy industry. This paper focuses on the
extensive effects of COVID-19 on India's renewable energy sector, a country that has proven to
be proactive and progressive when it comes to solutions for sustainable development. It
showcases the present impacts of the pandemic on the sector and highlights future projections of
the way it may continue to affect this sector as the world continues to struggle with the
pandemic.

RESEARCH METHODOLOGY
3|Page
A research methodology is a strategy or technique for gathering, selecting, processing, and
analysing data on a certain topic. The researcher used a secondary method approach, referring to
and utilising data from many publications, websites, journals, and other sources.

LIMITATIONS

Despite the researcher's best efforts, there are certain limitations to this article. The researcher's
most significant constraint was a lack of resources. All of the big organisations were not included
in the study. There were also only a few sources pertinent to the topic that the researcher could
uncover.

HYPOTHESES

1. H0: There is a positive impact of COVID-19 in the renewable energy sector in India.
2. HA: There is a negative impact of COVID-19 in the renewable energy sector in India.

INTRODUCTION

4|Page
COVID-19 was discovered in December 2019 in the Chinese province of Wuhan as a respiratory
disease with symptoms similar to pneumonia. From there, it spread slowly across China's
provinces and then beyond, until the World Health Organization (WHO) declared the disease a
global health emergency on January 30, 2020. The virus's spread could not be stopped, and as of
July 2020, India ranked fifth in the world with 600,000 cases of the disease. While the number of
cases and deaths from this widespread pandemic continues to rise, COVID-19 continues to have
a global impact on businesses, finances, and economies, causing trade markets and international
supply chains to collapse. The COVID-19 pandemic struck the world at a time when
sustainability was beginning to gain traction in the energy sector. Many climatically proactive
implementations, such as the new frameworks of the European Union's (EU) emission trading
system (ETS) and standards for vehicular emissions aimed at reducing carbon emissions, were
expected to gain traction beginning in 2020. The political and economic transitions brought
about by COVID-19, on the other hand, have hampered them all. Renewable energy projects
underway in various regions around the world have influenced new capacity additions in the
power sector and have increasingly outperformed fossil fuels in recent years. Its interest in
enhancing environmental sustainability is evident from research on its solar energy front and
biomass energy front, among others; even hinting at the introduction of solar electric vehicles in
the nation's transportation industry, spiking new hopes for the renewable energy sector; however,
the pandemic-caused economic fallout is deep-rooted and has not let go of this country's
renewable energy sector either.

One of the major issues in the renewable sector is turbulence in global supply chains, which is
caused by a significant decrease in production from many parent industries. For example, solar
panel shipments from China have ceased entirely, putting the solar power industry in jeopardy.
Countries such as Australia, Brazil, Mexico, and South Africa are among the most likely to be
impacted by renewable energy projects, as installation processes are currently in the procurement
phase. Furthermore, due to rapid deflation of local currencies, the face capital cost in these
countries has risen to around 36%. As a result, it is unavoidable to keep the renewable sector out
of the crosshairs of the disaster's consequences. To increase private investment in the sector, the
government must provide several beneficiaries and promotions. However, as Hosseni (2020)
claims, intelligent management and handling of this situation, as well as the introduction of a

5|Page
favourable framework, could turn this situation into a boon rather than a curse for the renewable
energy sector.

The renewable energy sector in India has not been spared the wrath of the current pandemic. The
country had previously hoped to increase its renewable energy capacity by 175 GW by 2022, but
that growth has now been significantly slowed. The solar and wind energy sectors have been hit
the hardest. Almost 80% of solar cells and modules were imported from China, which is
currently at a standstill due to production losses and quality control issues, as informed by
Chinese companies to the Indian government handling the matter. With 38.06 GW of wind
capacity as of 2019, India is the fourth-largest onshore wind market by installation, and wind
installation in India is expected to be impacted by the outbreak. Due to the COVID-19 outbreak,
challenges such as land acquisition, grid unavailability, supply chain bottlenecks, and a lack of
project financing are making it difficult for the government to meet any previously set targets.
Due to a lack of alternatives in raw materials and insufficient capability to meet deadlines, as
well as transition delays, the country's wind energy sector will face its own set of challenges,
severely affecting the installation of new wind projects.

COVID-19 is a once-in-a-lifetime event that defines a disaster never seen before in modern
history. With crumbling industries and a decade-long setback for growing economies, the effects
of this pandemic are still being felt around the world months after it was declared. This work
focuses on one such industry that has recently received a lot of attention from the research world,
the Renewable Energy Sector, in terms of the effects COVID-19 has had on it. Renewable
energy has been identified as one of the only ways to repair the environmental damage caused by
mankind's gross negligence over the years. It is a path to a completely self-sustaining and
flourishing existence. As a result, a determination of the impact of a pandemic of this magnitude
on this industry is an absolute requirement.

REVIEW OF LITERATURE

6|Page
PRESENT IMPACT

Figure 1. Daily energy met (in MU) graph before and during lockdown tenure.

To tackle the impending issue of the spread of COVID-19, the government of India took a
historic decision of ordering a series of lockdowns across the country. Although the sudden call
for a lockdown caused some repercussions within the state, such as issues with migrant workers
and problems caused by the complete shutdown of transportation facilities, one of the major
sectors that required the most assistance in dealing with the ongoing situation was the power
sector. The sudden closure of industries and largely electricity-run transportation facilities, such
as India Railways, resulted in a 40 percent gap in the nation's current energy demand. For
example, on March 16th, energy demand was 3494 Million Units (MU), with a projected range
of 2600–2800 MU during the lockdown period.

As illustrated in Figure 1, this trend can be observed that apart from causing a loss of over 85000
crore Indian Rupees (INR) to power distribution companies, this massive drip is expected to
have a long-term impact on the India Power Sector. Now, the renewable energy sector, which is
fully integrated into the country's power grid, is no exception. The first steps to dealing with a
sudden drop in energy demand would be restrictions on power generation, putting renewables at
a disadvantage due to their often-fluctuating nature. There may be numerous specific cases that

7|Page
can be considered to further delve into the deeper roots of the impacts on them. Investments in
the renewable energy sector reached an all-time high in 2017 and have since been declining. This
graph has only gotten worse as the COVID-19 has caused economic tremors all over the world,
making the sector even more vulnerable to a lack of funds. Because of the disruptive nature of
the disease's spread, areas must be placed under lockdown not only in India but around the
world, making power projections a major issue. This has a direct impact on the renewable energy
sector. China, where this disease first appeared, was a major supplier of PV modules, affecting
trade in the renewable energy market directly. The virus's impact has cost the state a staggering
INR 7 billion, which it hopes to recoup through rooftop solar projects. However, the dense
population and tropical terrain complicate matters even more. In a few cases, a lack of customer
trust even resulted in a strain in company relations, further reducing the market for renewable
energy. Subsidies are expected to decline, and the renewable energy sector has asked the state
government to fill the gap with incentives.

FINANCIAL IMPACT:

8|Page
 Figure 2. Dues owed by states of India to the renewable energy sector as of July 2019

The most significant pivot affecting the renewable energy sector is financial impact: with
demand falling by 20–25 percent of the usual peak, distribution companies are already facing a
revenue loss of more than 12 billion dollars, rendering them unable to pay renewable generators
of electricity. It is a well-known fact that even before COVID-19, the country's renewable sector
owed the distribution companies a sizable sum of money. As of July 2019, long before the
COVID outbreak, big names in the renewable market like Tata Power Renewable Energy, Adani
Group, and ReNew Power owed a total of 3,860 crores. This poses significant challenges to the
government's ambitious goal of achieving 175 GW of renewable energy. According to the
Central Electricity Authority's (CEA) report, over 24 GW of renewable energy production had
exceeded dues of 9,735 crore INR by July 2019. Andhra Pradesh, Tamil Nadu, Telangana, and
Karnataka, four of the country's many states, account for more than half of the total dues. Figure
2 depicts the amount of money owed to the renewable energy sector by some Indian states as of
July 2019. The country's wind energy sector, which is the fourth largest in the world in terms of
market acquisition, would also be severely impacted by the outbreak of this pandemic. It had
goals of obtaining 60 GW of energy by 2022 and 450 GW of energy by 2030, both of which
have been impacted by unforeseen developments in situations. Vestas, Siemens Gamesa, and LM
Wind Power, three of the top competitors in the wind energy market, have already halted energy

9|Page
production since the government declared a nationwide lockdown. Mathematical implications
show that this delay will affect approximately 600 MW of new wind power additions by 2022.
Prior to the pandemic, India and China were the leading players in the wind energy industry, a
position that will be difficult for India to maintain in the midst of the nationwide lockdown. Both
countries, along with the United States, the United Kingdom, and Spain, accounted for 70% of
new wind power additions in 2019, but are currently among the worst hit by the pandemic,
making the impact on the sector unavoidable.

When discussing the effects of COVID-19 on the renewable energy sector, it is also necessary to
mention the Oil Industry, which underwent significant changes during this time period. Because
of tensions between Russia and Saudi Arabia, oil prices have already reached a global low since
the beginning of 2020. A perpetual global lockdown that followed in the early weeks of 2020
caused oil prices to plummet even further. With global transportation ground to a halt, demand
for oil fell; however, the supply of oil from Saudi Arabia in the market remained consistent. This
resulted in a flood of oil in the market with very few buyers. India, which is more of an importer
of oil than a producer, imports nearly 82 percent of its oil, has the better of the situation. It is
estimated that if the global oil price falls by one dollar, the country's import bill will benefit by
3000 crore Indian rupees (INR). This is an advantageous position for the country, as it provides
an opportunity to strengthen its currency against the US dollar.

FUTURE IMPACT

10 | P a g e
Bringing the focus back to the renewable sector, similar predictions for long-term effects have
been made. Citing specific examples, an exclusive renewable energy company in the country
claims that the solar sector's previously assigned deadlines could be pushed back by at least six
months due to the impending lockdown. India had a big target to meet in the solar sector,
especially when it came to rooftop projects: the government had notified of its ambitious plans of
40 GW of rooftop solar power installations within the country by 2022, but with the onset of the
given circumstances and with very few signs of the situation improvising, there are very few
signs of the fulfilment of this target, worrying planners and investors alike. The rapid
development of renewables is a critical aspect in the development of any project of that type, and
this term was previously forecasted as a golden period for gathering that pace, but recent events
have left that aspect in complete disarray. With restricted movements, closure of factories and
industries, and complete unavailability of transport facilities across the whole country, rooftop
solar projects are taken to be the most affected part of the renewable sector. The nation's
vulnerability in meeting the 2022 target will have a significant impact on the job market. The
government had projected a large number of jobs in the country by 2022, as shown in Figure 3,
but the current situation makes this an impossible goal. As a result, unemployment would persist
in the country for longer than citizens or the government would have preferred.

11 | P a g e
 Figure 3. Initial projection for the creation of jobs by 2022

The closure of many thermal power plants during the lockdown period necessitated additional
drawdown from renewable power plants. This may also be viewed positively, as once the
country recovers from the pandemic, renewable energy may be permanently established as the
major supplier of power to the Indian power grid, supplanting polluting thermal plants. If the
benefits of the lockdown are maintained throughout, the map of the Indian power system could
be forever altered. When most states in the country reduced their power supplies due to
decreased demand, the MNRE had already designated renewable energy projects as the most-run
energy sources. This is a very striking improvement in the status of the renewable power plants
in the country’s infrastructure. Making renewable projects as ‘most-run’ makes it compulsory for
the states to buy power from these sources, drastically improving the market shares of renewable
energy.

During the pandemic, the government has identified power generation, including from renewable
sources, as a critical service. The MNRE has also aided the process by relaxing project deadlines,
making it easier for the plants. The ministry has also ordered that all state dues for renewable
energy projects be paid immediately. However, the extent of the effect of COVID-19 on the
world at large is a very unpredictable data point in the overall projection because it is a
continuous process with very few signs of recession as of the current timeline. In any case, it is
almost certain that the renewable energy sector will benefit in a variety of ways as a potential
power source. However, the long-term damage to India's renewable energy goals for 2022 cannot
be overlooked. COVID-19's future effects may be declared to be as erratic as renewable energy
sources themselves, but the given drift to their projection as an important pivot of Indian society
has made environmentalists and scientists more optimistic about their future status. Bodenheimer
and Leidenberger have already claimed in their recent work that this pandemic could prove to be
a glorious stage of opportunity for the renewable and sustainable energy sector, but achieving
that requires strategic planning and well-designed communications on the part of policymakers.

12 | P a g e
CONCLUSION

Aside from having a largely negative impact on the global economy and human life in general,
the induced global lockdown has resulted in dramatic improvements in the surrounding
environment. Many things can happen to men during their lives that are beyond their control or
influence. It is absurd to believe that normalcy of daily life would remain aloof during such
times. As a result, it is more important to focus on parts where the impact can be minimized.
Stringent laws must be enacted during normal times to ensure that any apocalypse has the least
possible impact on daily operations. This is accompanied by the implementation of a completely
independent, strong, robust, and efficient resource management system. The effects of the
COVID-19 outbreak in India on the renewable energy sector are investigated in this study. A
large number of industries are affected by the Covid-19 lockdown, and the renewable energy

13 | P a g e
sector is one of them. Due to the large number of industries and a dense population, India has a
high demand for power. Because of the pandemic, the Indian government's target of installing
175 GW of renewable energy capacity by 2022 is now in jeopardy.

Limiting imports of goods from other countries by producing their own would not only boost the
economy by lowering import costs, but would also create a large number of jobs within the
country to compensate for the losses suffered by the employment sector during the lockdown of
industries and businesses alike. Such a drastic step forward cannot happen overnight. It is a time-
consuming process, but simply introducing the concept is an accomplishment in and of itself.
Sending invitations to both domestic and foreign investors, promoting self-reliance laws, and
improving the strategic framework are some of the ways India can achieve its new goal. This
would not only help the country recover from the current disaster, but would also strengthen its
defences against any future global impact.

A close examination of the present and future impacts of COVID-19 on renewables reveals that
the majority of issues are encountered because India imports the majority of its raw materials
from China, which is the epicentre of the pandemic. Due to laws prohibiting the import or export
of both people and goods during the lockdown period, India has run out of raw materials, halting
any progress in the sector. The country has come a long way toward establishing itself as a
potential global leader in the solar energy sector. However, in order to achieve absolute
dominance in the world, the country must, in addition to gaining raw material independence,
implement measures to address internal issues such as duty safeguarding, tax management, and
so on.

It is important to note that COVID-19 is still a spreading pandemic; it is a dynamic disaster with
no end in sight. As a result, its effects will not fade as quickly, and there is a good chance that
they will increase. Many changes can be made to this work in the future to better align it with
current circumstances. It is too early to speculate about a transformed, post-COVID world, and
scholars can only make educated guesses based on available data.

14 | P a g e
 REFERENCES

1. Article: 3GW of renewable energy installations in India expected to be impacted by

Covid-19. 2020. https://www.powertechnology.com/comment/renewable-energy-
installations-india-covid-19/.
2. Article: Coronavirus: When will the outbreak end and life get back to normal, The
Economic Times. 2020. https://www. bbc.com/news/health-51963486.
3. Article: COVID lockdown to impact electricity demand, cash flows for discoms: ICRA,
The Economic Times. 2020.
https://economictimes.indiatimes.com/industry/energy/power/covid-lockdown-to-impact-
electricity-demand-cashflows-for-discoms-icra/articleshow/74896822.cms?from=mdr.

15 | P a g e
4. Article: COVID-19 and Indian PV: Kerala renewables nervous of extended virus impacts,
2020. https://www.pv-tech. org/news/covid-19-and-indian-pv-kerala-renewables-
nervous-of-extended-virus-impacts
5. Article: COVID-19 educational disruption and response. 2020.
https://en.unesco.org/covid19/educationresponse.
6. Article: Covid-19 Lockdown: India Moves To Ensure Renewable Projects Remain
Unaffected, Clean Technica. 2020. https://cleantechnica.com/2020/04/12/covid-19-
lockdown-india-moves-to-ensure-renewable-projects-remainunaffected/
7. Article: Covid-19 to wreck economics of new solar, wind projects. 2020. https://www.pv-
magazine.com/2020/04/01/ covid-19-to-wreck-economics-of-new-solar-wind-projects/.
8. Article: COVID-19: Clean energy challenges and opportunities, Standard Chartered.
2020 https://www.sc.com/en/tradebeyond-borders/covid-19-clean-energy-challenges-
and-opportunities/.
9. Article: COVID-19: Prolonged lockdown can affect renewable energy sector. 2020.
https://www.downtoearth.org.in/ news/energy/covid-19-prolonged-lockdown-can-affect-
renewable-energy-sector-70341
10. Article: What is the impact of COVID-19 on power sector? 2020. https://www.power-
technology.com/features/impactcovid-19-power-sector/.
11. Article: Why oil prices are going down and how it affects the Indian economy. 2020.
https://theprint.in/economy/whyoil-prices-are-going-down-and-how-it-affects-the-indian-
economy/378202/.
12. Bodenheimer, M., and J. Leidenberger. 2020. COVID-19 as a window of opportunity for
sustainability transitions? Narratives and communication strategies beyond the pandemic.
Sustainability: Science, Practice and Policy 16 (1):61–66.
13. Cohen, M. J. 2020. Does the COVID-19 outbreak mark the onset of a sustainable
consumption transition? Sustainability: Science, Practice and Policy 16 (1):1–3.
14. Coronavirus disease. 2019. (COVID-19) Situation Report-94
https://www.who.int/docs/default-source/coronaviruse/ situation-reports/20200423-
sitrep-94-covid-19.pdf#:~:text=The%20first%20human%20cases%20of,%2C%20in%
20December%202019.

16 | P a g e
15. Ghose, D., S. Naskar, and S. Uddin. 2019. Q-GIS-MCDA based approach to identify
suitable biomass facility location in Sikkim, India. Proceedings of the Second
International Conference on Advanced Computational and Communication Paradigms,
IEEE, Sikkim, India, Proceedings published in IEEE Xplore.
16. Ghose, D., S. Naskar, S. Uddin, and A. K. Roy. 2019. An open source software – Q-GIS
based analysis for solar potential of Sikkim (India). International Journal of Open Source
Software and Processes 10 (1):49–68. doi:10.4018/ IJOSSP.2019010104.
17. Ghose, D., S. Pradhan, P. Tamuli, and S. Uddin. 2019. Optimal material for solar electric
vehicle application using an integrated Fuzzy-COPRAS model. In Energy sources, part
A: Recovery, utilization, and environmental effects. Taylor and Francis.
doi:10.1080/15567036.2019.1668879
18. Hosseini, S. E. 2020. An outlook on the global development of renewable and sustainable
energy at the time of COVID-19. Energy Research & Social Science 68:101633.
doi:10.1016/j.erss.2020.101633.
19. Ozili, P. K., and T. Arun. 2020. Spillover of COVID-19: Impact on the global economy.
Munich Personal RePEc Archive ID: 99850. doi:10.2139/ssrn.3562570
20. Record: Countries where COVID-19 has spread. 2020.
https://www.worldometers.info/coronavirus/countries-wherecoronavirus-has-spread/.
21. Steffen, B., F. Egli, M. Pahle, and T. S. Schmidt. 2020. Navigating the clean energy
transition in the COVID-19 crisis. Joule 4 (6):1137–41. doi:10.1016/j.joule.2020.04.011.
22. Zhi, Z. L. X. B. X. Z. 2020. Epidemiology working group for NCIP epidemic response,
Chinese center for disease control and prevention. National Library of Medicine 41
(2):145–51.

17 | P a g e