How Will 1.5 Billion Indians Transit Into Clean Energy?

Arriving in India, as I did last week, is a reminder that the energy transition is not an academic exercise written out in the pages of reports. Rather, and quite literally in the case of Delhi, it is lived on the streets where airconditioned cars share the roads with an army of three-wheeled autorickshaws, often under a spaghetti of wires which run between buildings.

There are visible signs of how the energy transition is playing out. The two- and three-wheelers are increasingly electrified, and solar panels are becoming a more common sight on rooftops. The latter has, according to the government, grown 53% across the country since 2023, and the ambition is to have 10 million households producing their own solar power two years from now.

The push factors and challenges to the energy transition are also very visible in Delhi. It is the most air polluted capital in the world and Indian cities feature prominently in the list’s top twenty. And the poverty which is evident on the streets is reflected in the country’s economic data. A recent report indicated that 90% of Indians lack disposable income, and the consuming class is getting wealthier rather than expanding in size, a sign of rising inequality.

In the background to these chronic challenges are some longer-term landmarks which will influence the transition. India will no doubt want to showcase itself as a modern, technology driven economy when it marks 100 years of independence in 2047. And by 2070 India wants to reach net zero.

Having met thinktanks, private companies and governmental agencies in Delhi during my visit, I was, nevertheless, left feeling optimistic. Here are some takeaways.

The appeal of energy security

Energy security has become the driving factor for energy security for governments around the world, and India is no exception. Currently, 80% of India’s energy is provided by fossil fuels and 85% of its oil is imported from abroad, leaving it vulnerable to geopolitical shifts.

It is noteworthy that one of the headline outcomes of Prime Minister Narendra Modi’s recent trip to see President Donald Trump in the White House was an agreement for India to buy more American oil and gas.

The ability to scale

For Europeans, visits to Asia are often a lesson in ambition and scale. Delhi’s population alone is larger than most European countries. The city’s transport minister has just announced that 1 000 new electric buses will be on the city’s streets in the next month. As a comparison, Oslo, once the European Green Capital, has less than 300 electric buses.

Market size alone is not enough to build an energy transition and there are encouraging signs of clear government ambitions supported by policy, and a readiness by Indian industry to embrace the challenge. India’s traditional industrial powerhouses have turned their attention to the technologies essential to the energy transition. Tata, for example, has strong ambitions in the wind, solar and electric vehicle markets.

Besides the three-wheelers, small Tata four-wheeler green taxis were the most common EV I observed in the streets. And while Tata is an established conglomerate, small start-up are also part of the answer. Ola Electric and Ather Energy did not exist 10 years ago, but the two are selling tens of thousands of electric two wheelers every month.

The Indian government recently celebrated the installation of 100 GWs of solar energy, which is a 35 times increase from a decade ago. This is part of a broader government plan to install 500 GWs of non-fossil fuel based energy capacity by 2030, the main short-term Indian energy transition goal everyone is measuring their plans against.
Such high percentage growth is reflective of solar (and wind) power’s extraordinary growth around the world in recent years. And whilst India’s growth is impressive, it is put into perspective by China, which installed 280 GWs of solar in 2024, compared with India’s 25 GWs.

Working with China

It is maybe politically uncomfortable that it is their neighbor China that has become the global engine for green technology. India, like other countries, must decide how much it wants to involve China in its energy supply chain. Is the goal just to decarbonize as quickly and cheaply as possible or is the goal also to build a green technology powerhouse that could rival China? If it is the former, then the roads will be filled with BYD cars and its coastline dotted with Chinese built wind turbines. If it is the latter, then it could delay the country’s energy transition.

Throughout my meetings I was struck how the energy transition is intertwined with a feeling of pride and determination to meet the challenge. Modi’s Make in India initiative, which is designed to bolster domestic industry, is the policy manifestation of this sentiment. But it would be overoptimistic to think India can maintain its renewable targets relying solely on its domestic resources.

India’s annual economic growth rate of 6.5 percent is far above other major economies, and it will soon become the third-largest economy in the world. Given its growing economic muscle and industrial expertise I am confident that India will steer the right path towards a less fossil fuel dependent economy. However, the benefits of decarbonization to the many millions of Indians living in poverty will need to be clearly established for it to remain a political and economic priority.

There is maybe a disconnect to what is written in a report like our Energy Transition Outlook, and the reality of legislating and implementing the energy transition on the ground. How to untangle the spaghetti of wires in an Indian street is as complicated as finding the policy sweet spot between promoting national industry and maintaining renewable targets.

I certainly look with excitement at the path India chooses. And there is reason to pay attention, as the world’s most populous country, the soon third largest economy, and the country with highest absolute growth in energy use and emissions the coming decade; the path they chose is crucial for the global energy transition.