ONGC leads India’s renewable push with Rs 2 trillion roadmap

ONGC, clean energy
India's largest oil producer ONGC is making a major move towards net-zero emissions with heavy investments to offset carbon and invest in renewables.

ONGC has made a major announcement as part of its net-zero emissions roadmap, with the state-owned company planning to offset 9 million tonnes of carbon dioxide equivalent emissions by 2038. This ambitious plan will cost the company a staggering Rs 2 trillion, as per an announcement on Tuesday. ONGC, India’s largest oil and gas producer, is now the first fossil fuel company in the country to outline a detailed plan to reduce greenhouse gas emissions over a fixed period. While other major Indian PSUs, including Indian Oil, Indian Railways, and Coal India, have pledged net-zero targets, they have yet to share concrete plans, according to the global Net Zero Tracker portal.

ONGC’s move aligns with India’s larger targets of achieving net-zero emissions by 2070. The 200-page roadmap presented by ONGC carries significant weight for the country’s overall climate goals. Other companies are likely to be encouraged to follow suit, taking cues from the nation’s leading oil and gas producer. The substantial investment in renewable energy sources, such as green hydrogen and offshore wind, will not only reduce ONGC’s carbon footprint but also bolster India’s clean energy transition.

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Technology integration and innovation 

ONGC is also focusing on integrating cutting-edge technology and fostering innovation to achieve its net-zero goals. The company plans to leverage advancements in carbon capture and storage (CCS) technologies, which can significantly reduce emissions from its existing operations. Additionally, ONGC is investing in research and development to explore the potential of biofuels and advanced battery storage systems, ensuring a diversified and resilient approach to sustainable energy.

As part of its plan, ONGC has pledged a significant push towards renewable energy. By 2029-30, it aims to establish 3.89 gigawatts of renewable capacity across various projects in Maharashtra, Gujarat, Andhra Pradesh, Tamil Nadu, and Assam. This includes hybrid, offshore wind, and small hydropower plants. Over the next decade, this renewable capacity is envisioned to reach 6.03 GW, ultimately replacing reliance on natural gas and grid electricity for internal power generation.

Community and environmental impact 

ONGC’s commitment to sustainability extends beyond carbon reduction. The company is prioritising the well-being of communities and the environment through various initiatives. It aims to undertake extensive afforestation projects, which will not only sequester carbon but also improve biodiversity and support local livelihoods. Furthermore, ONGC is implementing stringent environmental safeguards and monitoring mechanisms to minimise the impact of its operations on surrounding ecosystems.

The financial commitment is substantial, with a planned investment of Rs 97,000 crore by 2030. This will be followed by additional expenditures of Rs 65,000 crore and Rs 38,000 crore by 2035 and 2038, respectively. Green hydrogen takes the lion’s share of the Rs 2 trillion investment plan, with Rs 80,000 crore allocated. Offshore wind energy projects follow closely at Rs 49,000 crore, while onshore wind and solar projects will receive a combined Rs 30,000 crore.

To accelerate its journey towards net-zero, ONGC is forging collaborations with global energy leaders and technology providers. These partnerships are designed to share expertise, technology, and best practices, enabling ONGC to implement the most effective and efficient solutions. By working with international partners, ONGC aims to stay at the forefront of the global energy transition and contribute to the worldwide effort to combat climate change.

India’s energy goals 

India has set ambitious targets of net-zero carbon emissions by 2070 and is heavily deploying resources to meet these goals. The government’s first priority is to reduce coal usage in the total energy share. India is making strides in this direction, as the share of coal in total power capacity dropped below 50% for the first time since 1966 in May this year. However, adverse weather conditions and surging power demand mean the country continues to rely on coal for over 70% of its electricity generation.

On the other hand, renewable energy accounted for 71.5% of the record 13,669 megawatts (MW) power generation capacity added by India in the January-March period, according to the POWERup quarterly report from the Institute for Energy Economics and Financial Analysis (IEEFA).

ONGC’s massive investment in renewable energy is expected to generate substantial economic benefits and create numerous job opportunities. The development of renewable projects will stimulate local economies, providing employment in construction, operation, and maintenance. Additionally, the focus on green technologies will foster the growth of new industries and skill sets, contributing to India’s economic diversification and resilience.

Renewable energy sector 

The focus of the government and policymakers is now to increase the share of renewable energy, leading to a booming renewable energy sector. India issued a record-breaking 69 gigawatts (GW) of tenders for utility-scale renewable energy projects in fiscal year 2024, significantly surpassing the government’s ambitious target of 50 GW.

India is also performing exceptionally well in solar energy, ranking third globally for solar power generation, surpassed only by China and the US, according to Ember’s fifth annual Global Electricity Review of 80 countries. This achievement underscores solar power’s dominance as the world’s fastest-growing electricity source for the 19th consecutive year. As India sets its sights on achieving energy independence by 2047, the adoption of green hydrogen and its derivatives has also become crucial.

Energy outlook by 2030 

Driven by investor-friendly policy initiatives, India today ranks fourth globally in renewable energy installed capacity. Solar and wind are leading India’s energy transition journey. By 2030, India appears well-prepared to achieve its renewable energy target of 500 GW installed capacity and reach 50% cumulative electric power installed capacity from clean energy sources. India’s energy scenario by 2030 is expected to be a mix of both renewables and conventional sources, with a gradual shift towards cleaner energy.

ONGC’s net-zero roadmap is closely aligned with the supportive policies and incentives provided by the Indian government. The company benefits from various government schemes promoting renewable energy adoption, including subsidies, tax benefits, and simplified regulatory processes. This policy support is crucial for ONGC to achieve its ambitious targets and for India to meet its national climate commitments effectively.

The upcoming budget on July 23rd is crucial for the power sector. As the nation eyes achieving a renewable energy capacity of 500 GW by 2030, the budget must lay a strong foundation for a sustainable future. By addressing key challenges and providing the necessary impetus for growth in renewable energy, thermal capacity, and new energy sources, the government can cement a sustainable and self-reliant future for India.