India’s ambitious push towards net-zero emissions amid rapid economic growth demands a massive financial commitment. A new report reveals the country must channel approximately $145 billion annually into power generation, energy storage, and grid modernization to bridge the gap between its expanding economy and climate targets.
Released on Tuesday by energy analytics firm Wood Mackenzie, the study highlights India’s progress on track for 1.5 billion tonnes of coal production by 2030. Efforts to diversify energy sources include a strong emphasis on coal gasification, positioning the nation to balance energy security with sustainability.
Natural gas demand is poised for a surge, projected to climb from 72 billion cubic meters in 2024 to over 140 billion by 2050. Industries will drive more than two-thirds of this growth, maintaining over 55% share even in the long term. This shift underscores the fuel’s critical role in India’s energy mix.
Despite gaps between economic expansion and climate pledges, India emerges as a viable alternative to China’s solar and battery supply chains. As global markets diversify suppliers, India’s robust manufacturing ecosystem offers a competitive edge.
Joshua Ng, Vice Chairman of Wood Mackenzie Asia Pacific, stressed the urgency: ‘India must bolster energy security while building a low-carbon system to emerge as a global economic powerhouse.’
Rashika Gupta, Vice President of Power and Renewables Research, detailed the investment scale: ‘$1.5 trillion from 2026-2035 will not only add capacity but strengthen distribution networks and grids.’ Success hinges on swift market reforms, particularly the Electricity Amendment Bill to spur competition and private investment.
Oil and gas remain indispensable in the near term. Crude oil import dependency could hit 87% by 2035, prompting calls to ramp up domestic production and lure international oil majors.
This roadmap positions India to navigate its energy transition effectively, ensuring reliable power for growth while advancing global sustainability goals.