Renewables would be preferred source of energy by 2030 with tariffs ranging between Rs 1.9-2.6 per unit for wind and solar power and storage cost declining by around 70 per cent, a report by Energy Transition Commission (ETC India) said.
The cost of storage will fall by about 70 per cent said, the report released on Wednesday on the sidelines of the World Sustainable Development Summit held in New Delhi said.
Even considering additional costs required to balance the variability of renewables, the study projected that a grid with 30 per cent variable renewable energy generation is cost-effective as compared to a moderate RE (renewable energy) system and does not raise costs for Indian consumers.
Considering other renewables, hydro and nuclear, the share of zero carbon generation can be even higher, at 45 per cent, while the share of coal falls to almost 50 per cent, the report added.
To balance the variability of renewables, the study highlights that increasing the flexibility of the electricity system is an urgent, complex and substantial challenge: if not addressed, the transition to renewables will stall.
An integrated approach to flexibility is required. This should combine shifting demand patterns to match RE production; adapting the operation of the dispatchable fleet; and deploying storage technologies, it said.
Commenting on the report, TERI Director General Ajay Mathur said, "We knew that renewables were cheap in India, but there were concerns that balancing their intermittency would raise consumer costs. This need not be the case: a high renewables system is cost-effective.
About the coal-based thermal power, he was of the view that the installed generation capacity would saturate by 2026 and would not be part of energy mix by 2060.
He was of the view that solar energy plus storage cost would be cheaper than incremental cost of coal-based power by 2025-26 making it unviable and unsustainable to go for coal-based power.
Lord Adair Turner, Chair, Energy Transitions Commission, said, the learning rate on technologies like lithium-ion batteries is quite phenomenal. This will be a game changer for the integration of variable renewables into the Indian grid.