Seeking to support the Union government's target of achieving 500 GW of non-fossil fuel energy capacity by 2030, Confederation of Indian Industry-Southern Region (CII-SR) Chairman Ravichandran Purushothaman has proposed three key policy measures to accelerate industrial electrification in southern India.
Addressing the 25th edition of the CII–Sohrabji Godrej Green Business Centre (CII-GBC) conference in Chennai recently, Purushothaman said energy competitiveness would be critical for the growth of MSMEs and manufacturing in Tamil Nadu and the southern region.
“A 40% discount on electricity tariffs during daytime hours and a 40% premium during evening peak hours should be considered. At the same time, states must focus on wind repowering, factory rooftop solar installations, agricultural solarisation, heat pumps and industrial electrification,” he said.
Highlighting the challenges faced by MSMEs, Purushothaman said the high cost of electricity in India was undermining their competitiveness. “Power costs around Rs 2.80 per unit in China, compared with roughly Rs 8 per unit in India. This cost disadvantage is not reflected in trade agreements and becomes evident when Indian MSMEs compete for export orders in markets such as Europe,” he said.
Purushothaman also pointed to the growing challenge of renewable energy integration. He noted that nearly 8,000 MW of solar power was curtailed in Rajasthan in March despite the state having installed around 41 GW of solar capacity, as the grid was unable to absorb the electricity generated.
Supporting the need for stronger grid infrastructure, Jamshyd N. Godrej, Chairman of CII–Sohrabji Godrej Green Business Centre and Chairman & Managing Director of Godrej & Boyce, said there was a mismatch between the pace of renewable energy generation and grid expansion.
“While a solar power plant can be set up in 1.5 to 2 years, the transmission and distribution infrastructure needed to absorb that power takes four to five years. We have focused on adding green energy generation capacity, but not enough on grid connectivity and distribution. Grid integration remains the missing link,” he said.
Godrej also highlighted the growing impact of air-conditioning demand on power consumption patterns. “Earlier, the second peak in electricity demand occurred around 6 pm to 7 pm. Today, it has shifted to 9 pm to 10 pm because of increased cooling demand. Many power grids are struggling to meet this surge in evening demand during the summer months,” he said.
He endorsed Purushothaman's proposal for lower daytime electricity tariffs, saying such a measure could encourage greater consumption of renewable energy when solar generation is at its peak