NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Last March, the Indian government implemented one of the most stringent coronavirus lockdowns in the world. With just a few hours’ notice, all 1.3 billion people in the country were ordered to stay at home for several weeks. Ongoing restrictions to limit the spread of the virus crippled economic activity. Businesses closed. Workers fled from cities. And India’s clean energy transition was put on pause.

Looking back, however, 2020 proved to be a decisive year for clean energy in India.

Bids for new solar projects hit record lows last year, affirming that coal is no longer the cheapest source of electricity. The country awarded landmark supply contracts for flexible renewable power, an important step in addressing the limitations of intermittent wind and solar. Cheap renewables were favored on the grid last year, which caused coal use to fall as energy demand plummeted amid the economic slowdown. Stimulus measures for utilities, an extension to project commissioning deadlines, and domestic solar manufacturing initiatives also helped to bolster the outlook for renewables.

Photo courtesy of Knut-Erik Helle.