Coal ko uncoal, that is the general idea

India is one of the bright spots in the global renewable and clean energy sector. Its RE portfolio is around 132 GW, with a target of 450 GW by 2030. India's energy basket is now 43% non-fossil fuel-based, which will be ramped up to 50% by 2030. This shift is remarkable - sceptics would say 'imaginative' - for a country dependent on coal. Despite its RE push, however, on Saturday, India refrained from signing the pledge at COP28 in Dubai to triple the world's current RE generation capacity to at least 11,000 GW by 2030. This stand, however, does not mean India opposes RE targets it had piloted and stated as a commitment at the G20 summit in New Delhi in September. However, the traditionally power-starved economy with an energy demand growth of 8% cannot afford to turn off the tap of its coal power units.

India has been self-financing its energy transition. In FY2020, domestic sources accounted for 83% of green finance for clean energy, transport and energy efficiency. Meeting the growing energy demand requires setting up new capacities. But India's constrained fiscal space means it will continue to rely on the cheapest option to build. The cost of RE-plus storage is lower than coal's. However, the cost of setting up a plant is the reverse.

Pledges, such as tripling the RE capacity, are part of the surround-sound at a UN climate conference. It is a statement of intent. There is no doubt of India's intent. But, instead of defending coal, India must spotlight the fiscal constraints pushing it towards coal. It must also prepare granular transition plans to determine the costs and needs better. India must make clear that without financial support, the pace of transition will likely be slow, and coal will continue to be king.