Hitting the 5 GW Renewable Energy Target by 2030
We are already on the path, and the journey started with our first project in Madhya Pradesh, which is about 300 MW of wind-solar hybrid. That project is operational. 250 MW is already commissioned, and the rest will be commissioned soon. We signed a partnership with Jakson Green earlier this year. That will give us 1 GW of additional capacity. So, in terms of our current presence, we already have 1.3 GW in construction or operation. In addition, we are working on several projects across the country, which involve some greenfield development in the states of Karnataka, Gujarat, and Tamil Nadu, as well as acquisition of new projects. These projects are either in early or late-stage development, or operational projects. So we continue to run our business development engine very actively. And I am very, very positive that we will be able to get to 5GW by 2030, if not sooner.
Embedding Sustainability in the Business and Supply Chain
Our core business model is to generate renewable energy, so we are contributing towards mitigating greenhouse emissions because we generate carbon dioxide-free electricity. So that is a very core part of our business operations. But we go much beyond that. Sustainability is not only about mitigating greenhouse gases emissions but really making sure that whatever we do is sustainable on a long-term basis for all stakeholders we impact. The first ones are our shareholders, who provide us capital to build our business and grow it, who need sustainable returns. And we don’t take risks which create dangers for the business. So on the shareholder side, while economic returns are one aspect, they are also very focused on the sustainability of the environment and the stakeholders like the workers on site, the communities we work in. So we have very specific targets on ensuring that we operate our business in a very healthy and safe manner, which does not create problems for the employees or workers on site. And also, we are a good corporate citizen where the communities we are working in are, if not enjoying our presence, at least they are not annoyed with our presence.
Addressing Land Acquisition and Creating Community Value
Land issues is a very broad term and you will find several of my peers talking about how it is difficult to acquire land for solar and wind projects. And it is correct because the amount of land we aggregate for our large-scale projects is humongous. To give you an example, the project we are doing in Bikaner requires about 3,000 acres of land. That is huge. It is multiple villages combined into one. So we should first of all appreciate that the scale of land acquisition is pretty high. Our first preference is to choose land which is either wasteland or unusable land. So there is no farming happening on it, or it will not impact the communities negatively. That is the first point. Even if it does – where we have to acquire some farmland – we make sure that the compensation we pay for either acquiring, buying or leasing those lands is at market rate, and the person who is leasing it to us will be in a better economic position than they are right now. So this is very, very important for us. Then we also make sure that not only the landowners who are giving us the land, but also the neighbouring communities, the people living there, receive some contributions from our side. We have a very active community engagement team who go and meet with community leaders, schools, hospitals, the Anganwadi, and we try to assess what the needs of the community are. In our first project, we ran a four-month-long community needs assessment programme with our local NGO, where we identified key gaps in community needs. Now we have designed a programme with several interventions in the local areas to help the communities have a better life.
Importance of ESG and Green Taxonomy in Securing Finance
It is very crucial. Since the beginning, we have made sure that we are keeping this very high on our agenda. This flows from the shareholder who is investing into Blueleaf. Blueleaf is 100% held by a fund managed by Macquarie Group. The fund already specifies the principles under which the investments are made. Macquarie has developed its own green scoring methodology, and any project we invest in goes through a very rigorous assessment of the green impact we are creating. So ESG reporting and green impact reporting are core to our investment decision process. After we have made the investment, on a regular basis, there are third-party agencies who assess our commitments and our compliance with whatever we have committed. So we take it seriously. At the project level, for each project, we conduct an environmental and social impact assessment even before we start any development activities. That impact assessment provides us, first of all, with clarity on whether building the project on a given site will have significant negative environmental impact. If so, we don’t proceed. If there are minor impacts, we build in measures to mitigate them. For instance, if there are birds in the region, we install bird spikes on the transmission lines. If we are doing construction, we ensure that dust emissions do not impact the local population. If we are setting up wind turbines, we conduct a full assessment of the shadow area and flicker area. So there is very detailed work at both the project and corporate levels to ensure that we meet – and surpass – our ESG commitments.
Understanding Flicker and Shadow Effects from Wind Turbines
So what happens is that when you build a very tall wind turbine, the blades can be around 90 metres in radius. The shadow of these blades can be significantly longer depending on the time of day. If people are living under those shadows, they may experience an irritating effect due to the shadow or the flicker of sunlight on the blades. So, first of all, we make sure that the locations we choose are ideally far from any habitation. And if there is any habitation within, say, 200 to 250 metres of the wind turbines, we work with the inhabitants and make adjustments to their houses or their living spaces so that they don’t experience negative impacts on their health or wellbeing. So site selection is critical, and if we do select a site close to habitation, we mitigate the impacts accordingly.
Dealing with the Critical Minerals Challenge
Lithium and silicon are very important parts of the value chain. We use lithium in batteries. Most of the batteries used in BESS these days are lithium-based. Most lithium processing happens in China. Mining takes place in several countries – in Africa, Australia, South America. So that is more varied, but processing is quite centralised in China. I don’t know if the industry has any short-term solutions. What we are doing now is, at least at the lower end of the value chain – where it is the assembly of batteries, making battery-enabled systems, managing them – we are trying to localise these processes in India. There is also a performance-linked incentive plan from the government, supporting several companies in the country in this area. But when you look at the upstream value chain, I think it’s quite strategic. So I don’t know if, as an industry proponent, I have specific answers. But yes, diversification of input sources is very crucial for any company or industry. That is something we certainly envisage and I’m sure our policymakers are looking into.
India’s progress on Panchamrit commitments
We have made progress for sure. I think the biggest one has been on adding renewable energy capacity. The target, one of the Panchamrit targets is to generate 50% of electricity from renewable energy. Earlier this year, we announced that in terms of installed capacity, India already has more than 50% of its electricity generation capacity in non-fossil or renewable energy. So that is a positive step. But if you go to a bit of detail there, we are saying 50% of electricity generated not 50% of installed capacity. So in terms of electricity generated, we are not more than 20% – 25% from non-fossil sources. So that has to go up. That would mean that we’ll have to consistently add more renewable energy capacity. The second one on 500 GW by 2030, I feel there is a risk to get into that 500 GW number. We are at around 250 GW. So we are at the halfway mark. And this 250 GW, if we add the current run rate of doing, say, 30 to 40 GW every year, we’ll be able to add 120 GW more, or maybe 200 GW more. So we might fall a little bit short, unless, you know, there are some surprises, positive surprises coming in. But I see that as a risk, and the big reason for that is that the transmission capacity has not been able to catch up with generation capacity. So we are seeing delays in projects because of lack of transmission capacity. In terms of the overall emission (intensity) reduction, I feel that is possible. It is a huge focus for the government and industries. But still, our nominal emission will continue going up because we are a relatively less developed country, we are a developing country, and we need to consistently grow at 6, 7, or higher percentage for a couple of decades to get to our goal of becoming a developing, developed country by 2047. So that would mean we will have to do a lot of economic activity, and that would create emissions. That is a challenge, and that is a huge challenge, because you have to cater to both the aspirations of the society, of having a better standard of living. And also mitigate the huge risk of climate crisis which we have ahead of us. So I don’t have a simple answer, but I would say we are making progress. We might fall short, but that should not be the reason for any disappointment, because I would track progress rather than, you know, meeting exactly the numbers what we targeted.
