India Set to Drive Global Energy Demand Growth with Renewables Taking Center Stage

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India is poised to become the largest contributor to global energy demand growth until 2035, according to the International Energy Agency's (IEA) World Energy Outlook. The country's energy demand growth will surpass that of China and all Southeast Asian countries combined. India will also be the largest contributor to oil demand growth, the second-largest for electricity generation, and third-largest for natural gas demand growth during this period. The IEA projects that non-fossil sources will account for 70% of India's installed generation capacity by 2035, with the country accounting for over 95% of global capacity increase in non-fossil sources. This growth is driven by India's ambitious renewable energy targets, which include increasing the share of non-fossil sources in the power generation mix to 50% by 2030. India has already met its 50% non-fossil capacity target five years ahead of schedule, thanks to surging investment in renewables. Solar PV has attracted $113 billion in cumulative investment over the past decade, compared to $112 billion for all fossil fuel power generation sources combined. Non-fossil sources are expected to contribute to over half of electricity generation in India by 2035, reducing the carbon intensity of electricity generation by nearly 45%. However, the rising share of variable renewables brings challenges, including the need for investment in storage and transmission to facilitate the deployment of renewables. India is addressing these challenges by investing in battery storage and putting out tenders for new storage capacity. The country is also facing concerns over critical minerals, particularly rare earth elements, which are essential for the production of renewable energy technologies. India has signed agreements with resource-rich nations to secure supplies and launched a ₹34,300 crore National Critical Mineral Mission to address the issue. The IEA's Executive Director, Fatih Birol, noted that the energy security tensions today are unprecedented, with multiple fuels and technologies at risk. Climate activist Harjeet Singh praised India's progress in the energy transition, saying that the country is showing how to power a growing economy with clean energy. However, India must now meet the challenge of meeting its growing energy demand cleanly.