Investing for a sustainable tomorrow

As the world continues to grapple with the serious economic and environmental consequences of climate crisis, addressing environmental and sustainability issues have assumed increasing importance. The carbon neutral sources of energy – be it solar, wind, geothermal or hydro – offer a cost-effective and sustainable way for the world to deal with the serious economic and environmental consequences of climate crisis.

Countries the world over are investing in green energy. Indian renewable energy sector is the fourth most attractive renewable energy market in the world. Globally, India was ranked fourth in wind power, fifth in solar power and fifth in renewable power installed capacity, as of Jan 2021.

Installed renewable power generation capacity has gained pace over the past few years, posting a CAGR of 17.33% between FY16-20. As of January, 2021, India’s installed renewable energy capacity stood at 92 GW, of which solar and wind comprised 38.79 GW and 38.68 GW, respectively. Power generation from renewable energy sources in India reached 127.01 billion units in FY20. India has a potential capacity of 1000+ GW.

The need for clean energy and the urgent need to step up generation to mitigate the climate change risks proved the setting for the Aditya Birla Group’s foray into the renewable energy sector in 2011. Initially, the renewable business was set up as part of the Essel Mining & Industries Ltd, but later a separate company – Aditya Birla Renewables Ltd – was formed to give shape to the Group’s vision for the sector.

“Solar was conceived to be the sunrise industry in strategic business deliberations based on the need for green technology from sustainability point of view and growth potential,” says Mr. Dev Bhattacharya, Business Head-Solar. Today, the business has 575 MW operational plants and 250 MW project pipeline.

The Group intends to play a major role in India’s push for green energy. India’s energy demand is expected to reach 15,820 TWh by 2040 and renewable energy will increasingly play an important role in the future. The country aims to achieve 227 GW of renewable energy capacity (including 114 GW of solar capacity addition and 67 GW of wind power capacity) by 2022, more than its 175 GW target as per the Paris Agreement.

While the renewable energy sector has witnessed the advent of several players, the Group is confident of standing out from the competition based on its USPs and its proven track record. “We want to be one of the most valuable and sought-after technology driven developers based on three USPs: highly reliable and durable solar plants with high uptime, state-of-the-art technology, and our customer-centric approach,” says Mr. Ravi Khanna, CEO Solar Business.

“Additionally, our ability to meet and exceed the committed energy (CUF) over extended period and achieve best-in-class LCOE will enable us to be the premium industrial and commercial solutions provider for the renewables and renewable driven sectors,” adds Mr. Khanna.

Investing in renewable energy holds importance for the Group, for another important reason. Responsible businesses can gain competitive advantage and become more sustainable by reducing the carbon intensity per unit of their products through increased use of renewable power to meet manufacturing needs.

“Sustainable development is going to be the major theme of all businesses. Improving the operational efficiency can contribute to a certain extent in reducing the carbon intensity but for significant reduction, you need to leverage clean sources of energy. So, the percentage of renewable energy in the total energy mix is only expected to grow and hence the relevance of business to the Group will remain,” says Mr. Bhattacharya.

ABG’s vision has encouraged Group companies to scale up their reliance on green energy. For the Aditya Birla Group, renewable is the future for sustainable use of energy sources. Through its investments in clean energy and leveraging technological innovations, the Group aims to make India a global clean energy powerhouse and offer sustainable solutions to mitigate the climate risks.