Until recently, the answer was overwhelmingly coal, which accounts for about 60 per cent of Indian power generation. Coal capacity has almost tripled in the past decade to 192GW and a further 65GW is under construction. The fastest growth, however, is coming from renewables. Significant amounts of hydro and wind generation have already pushed the share of green energy to about 30 per cent. This is now being supplemented by rapid expansion in solar power. A landmark was reached this May when an auction to supply 500MW of new solar capacity at a 10,000 hectare facility on the edge of the Thar desert secured a record low price of Rs2.44 ($0.04) per kilowatt-hour — down two-thirds from three years ago and, for the first time, cheaper than coal-fired generation. Plummeting costs have spurred forecasts that Indian solar capacity could double this year to 18GW, which would be more than six times greater than when Mr Modi’s government took power three years ago.
FT 23rd May 2017 read more »