Demand for oil, coal and natural gas to diminish further

The focus on power infra solutions for emerging smart cities is growing. There is more focus on providing power through renewable energy sources of about 450GW by 2030. Dwarakanadha Reddy, Business Head, Projects Division, Amara Raja Power Systems, shares how the centre is planning hubs to manufacture renewable energy equipment, and these hubs will manufacture  equipment like silicon ingots and wafers, solar cells and modules.
How are energy trends affecting the market for energy equipment and accessories?
In the last few years, the energy sector has been impacted by significant transitions/  trends through 3Ds – Decarbonisation, Decentralisation and Digitisation – and with a shift in focus on  renewable energy sources even as traditional sources are maintaining prominence. Climate change, geopolitical challenges and rising fuel costs have forced India to revise its renewable energy  goals. The demand for oil, coal and natural gas is set to diminish further and will stay at an optimal energy mix of energy demand by 2030. As per estimates, the current share of renewable energy of 40 percent(165GW) is expected to reach up to 58 percent (500GW) in the coming few years.
With this context, the Indian energy  equipment market has become highly attractive globally with its latest technologies and trends to cater to the projected demand. It has opened the doors to  any domestic manufacturers like us – the Amara Raja Power Systems(ARPSL), which is part  of the $1.3 billion Amara Raja Group and one of the largest manufacturers of power control equipment  in the country. Established in 1984, the ARPSL and other competing players have supported building the requisite power infrastructure with the sustenance of the R&D framework and government backing.

How does the energy equipment business respond to India’s ever-increasing demand for uninterrupted power?
To provide continuous power, the government and the private sector must invest more in newer technologies to  enhance the electrical grid infrastructure’s safety and reliability. The industry is  looking at building smarter electrical grids to make the power transmission lines more intelligent. In addition, the focus on power infra solutions for emerging smart cities is also growing.  here is  ore focus on providing power through renewable energy sources of about450GW by 2030.
ARPSL is also working on similar lines with projects in renewable energy sources ranging from solar to  hydrogen. We are developing India’s first green hydrogen   fueling station in Leh, per an order received from NTPC. ARPSL has also taken up large-scale solar PV projects in different parts of the  country and is working on smart city and smart infrastructure projects. The components required for making these are majorly produced in India and hold a high growth potential in the coming  ears. It is an opportune time for India o bring policy changes for facilitating and catalysing manufacturing in India. The centre is planning hubs to manufacture renewable energy equipment. These hubs will manufacture equipment like silicon ingots and wafers,  solar cells and modules, wind equipment and ancillary items like back sheets, glass, steel frames, inverters, batteries and more.

What are the market’s concerns, particularly in cost  and sourcing raw materials?
The energy equipment market has always been import-dependent. However, the centre’s Make in India initiative and new domestic sourcing norms provide a fillip. Many large companies, startups, and government-led entities focus on manufacturing them domestically. The recent concerns of the pandemic and the Russia-Ukraine war have aggravated the issue of the lack of development of a solid and sustainable raw material supply chain. In such a scenario, companies must start focusing on building Giga factories for PV Solar, Li-Ion, electrolysers and energy storage  manufacturing and set up a strong ecosystem that supports localised supply systems. The procurement cost has also increased substantially due to the prevailing geopolitical tensions, rising fuel  costs, and rupee fluctuations.
What kind of efficient equipment is expected when the global energy sector becomes green in the following years?
As the globe progresses towards a greener and leaner energy sources, we anticipate that solar, hydrogen, wind and lithium-ion-based energy sources will emerge victorious. While average solar  tariffs have decreased in the last decade, renewable energy is a cheaper alternative in India. Components like solar PV modules, Inverters, Tracker  components and rooftop solar solutions will also  ow with   he government providing subsidies in this space.  he local manufacturing of cells and modules will also  gain momentum in solar and lithium-ion space. ARPSL anticipates that our capabilities in battery storage and R&D in cell manufacturing will make lithium-ion more affordable  in the coming days. Localisation of Hydrogen electrolysers manufacturing is another area of growth.
Electrification opens up the prospect of decarbonised road transport, with reports suggesting that sales of electric vehicles have grown rapidly in the last five years at a CAGRof 52 per cent.
If the world starts soon on the path of decarbonisation, then over one billion electric vehicles could be on the road by  2050. Amidst all this, the Battery Energy Storage System (BESS)  compensates   r the intermittency of these sources, provides essential value for operators by enabling a stable supply of electricity, avoids curtailment of renewable energy and maximises revenue.  RPSL has a significantly growing presence in the BESS space as well.