Latest news with #IEEFA
Time of India
22-07-2025
- Business
- Time of India
Why Jharkhand's small steelmakers risk missing the green bus — despite India's decarbonisation drive
New Delhi: As India's steel giants announce mega decarbonisation plans, a quieter crisis is brewing in Jharkhand's steel belt. Thousands of small and medium enterprises (MSMEs) that form the backbone of the state's secondary steel production are struggling to keep up with the country's green transition — and without support, they risk being left out of India's clean energy future, warns a new report by the Institute for Energy Economics and Financial Analysis (IEEFA). The report — Financing the MSME Transition in Jharkhand's Steel Sector — paints a stark picture. Jharkhand's steel sector emits nearly 3.9 million tonnes of carbon dioxide every year, largely from coal-based direct reduced iron (DRI) units and older induction furnaces. These MSMEs, critical to local employment and supply chains, currently have no viable path to decarbonise, with limited access to finance, technology or government incentives. India's steel output touched 150 million tonnes in 2024 and is expected to jump to 255 million tonnes by 2030. While large players like Tata Steel and JSW Steel are ramping up investments — JSW has committed ₹86,000 crore to cut its emission intensity to 1.95 tonnes CO₂ per tonne of crude steel by 2030 — the MSME segment is falling behind. 'Steel is one of the most energy and emissions intensive industrial subsectors. Without targeted support, MSMEs risk being excluded from India's low-carbon transition, threatening jobs and deepening regional disparities,' said Labanya Prakash Jena, co-author of the report and Sustainable Finance Consultant at IEEFA. In Jharkhand, MSMEs account for 3.6 MT per annum of coal-based DRI capacity, operating alongside 19 MT of hot metal production by larger integrated steel producers like Tata Steel and SAIL. Despite the state's strong steel legacy, most small units are stuck with outdated technologies and cannot easily transition to low-emission alternatives like green hydrogen or electric arc furnaces. The report notes that most MSMEs still treat energy efficiency and renewable energy as 'non-core' investments, with long payback periods and unclear returns. Even Energy Service Companies (ESCOs), which could support these transitions, face their own challenges — from weak balance sheets to lack of access to working capital. To address this financing gap, IEEFA has proposed the creation of a Green Financing Facility for Just Transition (GFF-JT) in Jharkhand. This would be a dedicated project preparation facility designed to help MSMEs and ESCOs access early-stage capital for feasibility studies, financial structuring, and legal support — essentially enabling them to structure bankable green projects that public and private investors can fund. 'By providing early-stage funding for essential services such as technical and commercial feasibility studies, financial structuring, GFF-JT can help advance economically viable projects to a stage that allows public and private investment,' said Shantanu Srivastava, Sustainable Finance and Climate Risk Lead at IEEFA. The proposed facility would be anchored by the Government of Jharkhand, supported by donor agencies, public finance institutions and philanthropies. It could also integrate with existing government schemes such as SIDBI's Green Finance programme, the MSE-GIFT scheme, and the Rooftop Solar Subsidy. The report outlines three practical ways in which MSMEs can reduce emissions: improving energy efficiency, adopting renewable energy, and switching to material-efficient practices. Energy efficiency alone could reduce coal use by up to 25 per cent and increase productivity by 20 per cent. Rooftop solar and open-access power procurement could also help cut costs and emissions. The report also warns that without support, India's green steel journey could deepen inequality within the sector. While Tata and JSW adopt low-carbon technologies, smaller firms risk becoming uncompetitive or shutting down entirely — impacting jobs, supply chains, and regional economies. IEEFA recommends that the GFF-JT be eventually expanded to other key steel-producing states like Odisha, Chhattisgarh and West Bengal, where similar challenges exist. For Jharkhand's steel MSMEs, the report signals a crucial turning point. Without a dedicated financing mechanism, the green transition could bypass the very workers and entrepreneurs who have kept the state's steel furnaces running for decades.>
Time of India
15-07-2025
- Business
- Time of India
Residential power use rises 10% annually amid intensifying heatwaves: Experts
Residential power consumption in India has been rising steadily by around 10 per cent annually over the last three years, driven by rapid urbanisation, intensifying heatwaves and population growth, experts have said. Experts from the Institute for Energy Economics and Financial Analysis (IEEFA), an independent think tank, said the residential sector accounted for 31 per cent of the country's total electricity consumption in the financial year 2024. The industrial, commercial and agricultural sectors accounted for approximately 32 per cent, 10 per cent and 22 per cent of electricity sales respectively, they said in a briefing note. In 2024 alone, air-conditioner sales surged by 40 to 50 per cent, reflecting a growing demand for indoor cooling amid intensifying heatwaves, they said. According to another recent study, India adds 10 to 15 million (one crore to 1.5 crore) new air-conditioners annually, with another 130 to 150 million (13 crore to 15 crore) expected over the next decade. Without policy intervention, air-conditioners alone could drive 120 gigawatt of peak power demand by 2030 and 180 GW by 2035, nearly 30 per cent of the projected totals. Rural electrification is also playing a key role in increasing residential demand. With near-universal household electrification achieved under schemes like Saubhagya and feeder segregation improving the supply quality, millions of rural households are now receiving longer and more reliable power supply. The IEEFA's analysis of national peak demand trends showed a consistent year-on-year growth, with FY2025 recording the highest monthly peaks so far. May and June have regularly seen the highest electricity demand, likely due to extreme summer temperatures increasing cooling loads. FY2024 and FY2025 both saw their maximum peak loads in September and May respectively -- one due to summer heat and the other potentially due to post-monsoon industrial ramp-up or weather anomalies, said the authors, including the IEEFA's South Asia director, Vibhuti Garg, energy specialists Saloni Sachdeva Michael and Charith Konda, and energy analyst Kaira Rakheja. They said rising temperatures and extreme weather events are now major drivers of electricity demand, particularly in densely-populated and industrialised areas. The northern region comprising Uttar Pradesh, Delhi, Punjab, Haryana and Rajasthan accounts for more than 30 per cent of India's peak electricity demand and is especially sensitive to temperature shifts. Between May 16 and May 20 this year, the power demand in the northern region rose steadily amid widespread heatwaves. As one of the country's most electrified and densely-populated cities, Delhi's power consumption closely mirrors temperature trends. Between May 1 and May 16, the national capital's maximum temperature rose from 38.6 degrees Celsius to more than 42 degrees Celsius. During the same period, Delhi's electricity demand climbed from 5,956 MW to 6,789 MW, eventually crossing 8,000 MW in June. On May 15, the national power demand touched 231 GW at 3 pm, during peak solar-generation hours. The demand had already crossed 222 GW by 11 am and remained high through the day. Between 9 pm and 11 pm, even after sunset, it hovered close to 227 GW. A similar spike was recorded on April 25, when the national demand hit 235 GW, indicating that extreme weather is increasingly causing multiple demand peaks in a single day. The authors noted two key takeaways from these patterns. First, the overlap between peak demand and solar generation offers a chance to make better use of solar power, reducing the need for coal during the day. Second, the high demand after sunset highlights the urgent need for energy storage, demand-side measures and hybrid renewable projects to meet evening electricity needs. The analysis showed that coal continues to dominate India's electricity generation, accounting for nearly 73 per cent (or 157.6 GW) of the daily supply. It plays a critical role, particularly in the evening when solar availability drops. Solar energy accounts for around 9.5 per cent of the daily generation, peaking between 10 am and 2 pm. Around noon, the solar output often crosses 60 GW, helping manage high daytime cooling needs. Wind and hydro power add around 3 per cent and 8 per cent respectively, providing crucial support during morning and evening transitions.
Time of India
15-07-2025
- Business
- Time of India
Evening peaks strain India's power grid; coal dominates 73% of supply despite solar surge: IEEFA
New Delhi: India's electricity demand hit a record 250 gigawatts (GW) in May 2024, up nearly 50 per cent from 167 GW in May 2021, driven by increased cooling load, growing industrial consumption, and rising residential use during heatwaves. Despite the expansion of solar energy, coal accounted for 73 per cent of daily power supply on peak days, according to the latest briefing note by the Institute for Energy Economics and Financial Analysis (IEEFA).The analysis found that while solar generation has increased significantly, it does not meet demand during the late evening hours, leading to dual daily peak loads that stress the power system. Evening peak now rivals solar-hour highs On 15 May 2025, electricity demand reached 231 GW at 3 PM and remained elevated at 227 GW between 9 PM and 11 PM, the report said. IEEFA noted that these sustained evening peaks now nearly match the traditional afternoon peak, but solar power is not available after sunset, resulting in a continued reliance on thermal power. 'Electricity consumption by electric vehicles has grown nearly tenfold – from 59 million units (MUs) in FY2021 to 569 MUs in FY2024,' said Charith Konda, contributing author and Energy Specialist at IEEFA, South Asia. Storage, demand response key to managing post-sunset load IEEFA recommended accelerating battery storage deployment, hybrid solar-wind-storage projects, and demand-side measures to manage evening peaks. 'The persistent evening peaks reinforce the urgency of deploying storage solutions, demand measures and hybrid renewable projects,' said Saloni Sachdeva Michael, Energy Specialist and co-author of the report. The report also highlighted that on 15 May 2025, market clearing prices on the power exchange shot up to ₹10/kWh post 6 PM, driven by high demand and the withdrawal of solar supply. Time-of-day pricing could help shift usage IEEFA has called for more effective Time of Day (ToD) tariffs that widen the price differential between peak and off-peak periods to incentivise industrial and commercial consumers to shift usage to daytime hours. 'Incentivising load shifting from evening to day can help align demand with solar availability,' said Vibhuti Garg, Director, IEEFA South Asia. Focus on hybrid RE, battery storage, and import duty reform The study highlighted the importance of deploying battery energy storage systems (BESS) and pumped hydro to ensure round-the-clock power availability. It also called for cutting import duties on battery technologies and expediting PLI scheme disbursement to boost domestic battery manufacturing. 'Battery storage enables energy arbitrage by charging during near-zero-cost solar hours and discharging during high-demand hours,' said Kaira Rakheja, co-author and Energy Analyst at IEEFA. Demand from ACs, EVs, industry behind power surge India's rising power consumption is driven by increased use of air conditioners, electrification of transport, and commercial and industrial expansion, the report noted. In FY2024, industry accounted for 32 per cent, residences 31 per cent, agriculture 22 per cent, and commercial establishments 10 per cent of electricity consumption. The report also flagged upcoming demand from sectors like green hydrogen and digitised industries, underscoring the need for a flexible, low-carbon grid. Grid digitisation and cyber readiness crucial for future IEEFA underlined that along with physical infrastructure, digitisation of the grid, cybersecurity, and smart metering will be critical for managing two-way power flows and integrating rooftop solar and electric vehicles. 'As India's power demand continues to rise, grid flexibility, demand response, and clean storage will be central to ensuring supply stability,' the report concluded.
The Age
09-07-2025
- Business
- The Age
Cook not concerned by Japan on-selling surplus Australian gas
WA Premier Roger Cook has shrugged off criticism of Japan's on-selling of surplus Australian gas to other Asian customers, saying it is just part of their business model. Cook has just returned from a mission to Japan where the country emphasised the need for a continued stable supply of Australian gas to stabilise its energy grid as it moved away from coal-fired power. Cook met with senior Japanese bureaucrats and politicians, including Vice-Minister for International Affairs Matsuo Takehiko to discuss energy security, resources and decarbonisation. In the face of criticism from environmental groups of Australia's fossil fuel industry, Cook has repeatedly pressed the point that Australia's LNG helps larger Asian economies reduce carbon pollution by moving out of coal. 'What [Japan has] said to us is that as part of that energy transition, they need our LNG to be able to assist them to pivot away from coal and towards renewables,' Cook said on his way home from Japan on Tuesday. One of the biggest criticisms of that argument is that Japan, which is a big investor in Australian LNG projects, has been on-selling LNG because of a surplus of the fuel. The latest estimate from the Institute for Energy Economics and Financial Analysis found Japanese companies on-sold between 11.3 to 14.7 million tonnes of Australian LNG, which equates to about 1.2 to 1.6 times the annual gas consumption on the east coast energy grid. IEEFA suggests this gas is being on-sold to other Asian economies like Taiwan and South Korea.
Sydney Morning Herald
09-07-2025
- Business
- Sydney Morning Herald
Cook not concerned by Japan on-selling surplus Australian gas
WA Premier Roger Cook has shrugged off criticism of Japan's on-selling of surplus Australian gas to other Asian customers, saying it is just part of their business model. Cook has just returned from a mission to Japan where the country emphasised the need for a continued stable supply of Australian gas to stabilise its energy grid as it moved away from coal-fired power. Cook met with senior Japanese bureaucrats and politicians, including Vice-Minister for International Affairs Matsuo Takehiko to discuss energy security, resources and decarbonisation. In the face of criticism from environmental groups of Australia's fossil fuel industry, Cook has repeatedly pressed the point that Australia's LNG helps larger Asian economies reduce carbon pollution by moving out of coal. 'What [Japan has] said to us is that as part of that energy transition, they need our LNG to be able to assist them to pivot away from coal and towards renewables,' Cook said on his way home from Japan on Tuesday. One of the biggest criticisms of that argument is that Japan, which is a big investor in Australian LNG projects, has been on-selling LNG because of a surplus of the fuel. The latest estimate from the Institute for Energy Economics and Financial Analysis found Japanese companies on-sold between 11.3 to 14.7 million tonnes of Australian LNG, which equates to about 1.2 to 1.6 times the annual gas consumption on the east coast energy grid. IEEFA suggests this gas is being on-sold to other Asian economies like Taiwan and South Korea.
