PNNL

Abstract

Low carbon energy technologies are gaining increasing importance in India for reducing emissions as well as diversifying its energy supply mix. The present paper presents and analyses a targeted approach for pushing solar, wind and nuclear technologies in the Indian energy market. Targets for these technologies have been constructed on the basis of Indian government documents, policy announcements and expert opinion. Different targets have been set for the reference scenario and the carbon price scenario. In the reference scenario it is found that in the long run all solar, wind and nuclear will achieve their targets without any subsidy push. In the short run however, nuclear and solar energy require significant subsidy push. Nuclear energy requires a much higher subsidy allocation as compared to solar because the targets assumed are also higher for nuclear energy. Under a carbon price scenario, the carbon price drives the penetration of these technologies significantly. Still subsidy is required especially in the short run when the carbon price is low. It is also found that pushing solar, wind and nuclear technologies might lead to decrease in share of CCS under the price scenario and biomass under both BAU and price scenario, which implies that one set of low carbon technologies is substituted by other set of low carbon technologies. Thus the objective of emission mitigation might not be achieved due to this substitution. Moreover sensitivity on nuclear energy cost was done to represent risk mitigation for this technology and it was found that higher cost can significantly decrease the share of this technology under both the BAU and carbon price scenario.