BS Infra Summit: Clean energy's rise doesn't dent fossil fuel dominance

Twelve years on, fossil fuels still hold the same share in India's electricity, no matter how fast solar and wind grow

That electricity from thermal power plants still makes up the bulk of India’s total power generation, despite the big push in clean energy, is well known. 

But here’s the striking part: the share of thermal power — produced from fossil fuels such as coal, gas, and diesel — in the country’s total generation today remains exactly where it was 12 years ago, at 76 per cent. 

Data from the Central Electricity Authority, the country’s apex power sector planning body, shows India generated 1,734,375 gigawatt-hour (GWh) of electricity in 2023-24, of which 1,326,549 GWh — or 76 per cent — came from thermal power sources. 

Twelve years ago, at the end of the 11th Five-Year Plan, total power generation stood at 922,451 GWh, with thermal resources at 708,427 GWh — again, 76 per cent. 

So, where does the generation from non-fossil energy sources, which has expanded rapidly in recent years, show up? Why is it not shifting the country’s overall energy profile?

 

This paradox left energy experts at the just-concluded Business Standard Infrastructure Summit debating some hard questions.

 

The summit, a premier platform for meaningful industry dialogue on infrastructure, hosted a special panel discussion on The Future of Fossils. The speakers included Alok Kumar, former secretary, Ministry of Power; Mani Khurana, senior energy specialist, World Bank; Akshit Bansal, cofounder and chief executive officer, Statiq; and Ramanuj Kumar, partner, Cyril Amarchand Mangaldas.

 

Kumar partly explained the paradox, pointing out that the capacity-utilisation factor of renewable energy plants is very low. To match the output of a thermal plant, policymakers must plan for four to five times the installed capacity in renewables. Moreover, while green energy has grown, the overall size of India’s energy market has also expanded sharply, keeping fossil fuels entrenched.

 

The panel agreed that fossil fuels — including coal, natural gas, diesel, crude oil, and petrol — will continue to dominate India’s energy mix. Renewables still face grid integration hurdles, excessive reliance on foreign equipment and technology, and distribution companies’ reluctance to sign long-term power purchase agreements.

 

That said, renewables are helping address traditional bottlenecks. For instance, solar rooftops are narrowing the supply gap in rural and remote areas, while solar-powered pump sets are cutting diesel use on farms. India also added a record 29 gigawatt of renewable capacity in the financial year ended March 2025, underscoring both progress and paradox.