NEWS – A new study on India’s transition to clean energy  was released by the World Resources Institute (WRI)

HIGHLIGHTS

• Incentivising MSMEs: WRI study highlights the need for incentivising MSMEs for a smoother transition to clean energy.
• Energy Consumption: MSMEs account for 25% of India’s overall energy consumption.

Importance of MSMEs in India

• Number of MSMEs: 6.3 crore MSMEs.
• Employment: 10.1 crore people employed.
• Manufacturing Output: 45% of the total manufacturing output.
• Exports: 40% of total exports.

India’s Carbon Reduction Goals

• CO2 Emissions: Reduce by 1 billion tonnes by 2030.
• Carbon Intensity: Reduce below 45% by 2030.

Challenges Faced by MSMEs

• Financial Access: Limited access to finance for operations, expansion, and working capital.
• Technology: Dependence on cheaper, outdated technologies resulting in high energy consumption.

Energy Consumption Trends

• Growth Rate: 6.8% year-on-year growth in energy consumption (2012-13 to 2019-20).
• Future Projections: Energy consumption projected to increase from 30 million tonnes of oil equivalent (2016-17) to 72-17 million tonnes (2029-30).

Existing Government Schemes

• Positive Impacts: Various schemes by Union and state governments have positive impacts.
• Gap Identified: Lack of a standardised framework to measure the real-world impact of these schemes on the clean energy transition.

Recommendations from the Study

• Governance Structure: Thorough assessment needed.
• Institutional Frameworks: Improve and coordinate mechanisms.
• Awareness and Documentation: Address lack of awareness and lengthy documentation processes.
• Investment Payback Period: Consider longer payback periods for renewable energy investments.
• Sector-Specific Skills: Fill gaps in skills and knowledge specific to different sectors.

Call for Effective Interventions

• Tailored Approach: Union and state governments should consider unique challenges and opportunities of different MSME subsectors.
• Alignment with Needs: Ensure clean energy initiatives align with specific needs and characteristics of subsectors for efficient transition.