Rajasthan stands at a critical juncture in its energy transition journey, poised to play a pivotal role in India's ambitious renewable energy goals. With a renewable energy potential of 2109.7 GW, of which only 8% has been utilized as of FY23,Rajasthan's contribution to achieving the national target of 500 GW renewable energy capacity by 2030 is crucial. The state's RE Policy 2023 sets an ambitious target of 90 GW total RE capacity by 2029-30, including 65 GW from solar, demonstrating its commitment to this transition.
This report focuses on the state's primary generation utility, Rajasthan Rajya Vidyut Utpadan Nigam Limited (RVUNL), as a microcosm of the broader energy transition in Rajasthan. RVUNL, which currently supplies 50% of the state's power demand and primarily through coal-based generation, faces the challenge of greening its portfolio while maintaining energy security and equity.
The study presents three scenarios for RVUNL's transition: Business as Usual (BAU),Redirecting Capital for Accelerated Transition (RCAT), and Accelerated Decarbonization (AD). These scenarios explore different pathways for solar capacity addition and coal asset retirement, with investment requirements ranging from INR 25,817.48 Crores to INR 50,475 Crores until 2030.
The BAU scenario projects a modest increase in solar capacity, while the RCAT scenario assumes redirection of capital towards solar PV and retirement of older coal assets. The AD scenario presents the most aggressive transition, with substantial solar capacity addition and accelerated coal plant retirement. Each scenario has distinct implications for job creation, investment requirements, and the utility's generation mix.
Analysis of job impacts reveals that the AD scenario offers the most promising outcome, with total jobs increasing from 19,097 to 39,275 by 2030. This growth is driven by substantial additions to solar infrastructure and associated maintenance, repair, and overhaul services. The RCAT scenario shows a slight increase in total jobs, while the BAU scenario projects a decrease, highlighting the potential for job creation through aggressive renewable energy adoption.
Financing this transition requires a multi-faceted approach. The report outlines various financing options, including direct investments, project finance, green bonds, and public-private partnerships. The emergence of patient capital from foreign lenders and sovereign funds is noted as a positive trend. The role of Multilateral Development Banks (MDBs) and Development Finance Institutions(DFIs) in providing technical assistance, financial backing, and capacity buildings is emphasized.
The report underscores the importance of aligning state-level implementation with national policy frameworks. It proposes a comprehensive institutional calibration for RVUNL's transition, suggesting the establishment of a State-Level Steering Committee for Energy Transition. This committee would integrate expertise from various state departments to address technical, developmental and analytical aspects of the transition.
Accelerating solar capacity addition, exploring innovative financing mechanisms and strengthening institutional capacity for managing the transition need to be prioritised. The report also emphasizes the need for a just transition strategy that considers socio-economic impacts, particularly on vulnerable communities affected by the shift from coal-based power generation.
In conclusion, Rajasthan's energy transition, exemplified by RVUNL's journey, presents both challenges and opportunities. The aggressive de-carbonizationscenario offers the most significant environmental and employment benefits butrequires substantial investment and institutional recalibration. As Rajasthan moves forward with its ambitious renewable energy targets, a balanced approach that considers economic, social, and environmental factors will becrucial. This transition not only contributes to India's climate goals but alsopositions Rajasthan as a leader in renewable energy adoption, with potential for significant job creation and sustainable economic growth.
