HOUSTON — Over the next quarter century, the 240 million people without electricity in India will likely become the biggest force behind global energy demand, the International Energy Agency says in a new report.
The IEA believes by 2040 renewable power sources including solar and wind power will make up more than half of India’s new electricity generation capacity, as the center of gravity in the energy world shifts to cleaner fuels.
Solar panels could dot the Indian countryside one day: the country is poised to become the world’s second-largest consumer of solar power technology as its power capacity nearly quadruples to 1,100 gigawatts by 2040 – the same amount that powers Europe.
Quenching India’s energy demand will take $140 billion a year in new investments, and while India has deregulated much of its energy sector and has recently issued a “historic climate pledge,” growing demand could prompt policymakers to usher in a broader swath of energy investments, especially in renewables.
“India’s energy transformation requires three things: investment, investment and investment,” IEA Executive Director Fatih Birol said in a written statement on Friday.
Like the rest of the developing world, India experienced a surge in economic growth since the beginning of this century, its energy demand doubling since 2000. But India’s population without access to electricity is projected to climb to 600 million by 2040, and the headcount in its more developed urban areas is expected to expand by the equivalent of today’s United States. The country uses up 6 percent of the world’s energy supplies even though it has 18 percent of the world’s population.
That will change. The IEA believes oil demand in India will grow to 10 million barrels a day by 2040, importing 90 percent of its crude, mostly from the Middle East. And India could become the world’s biggest source of demand growth for coal, which currently makes up 70 percent of India’s electricity resources.
But much of India’s future investments will have to come from more efficient energy technology that produces low amounts of carbon. India has said solar power will make up nearly two thirds of the 160 gigawatts of power capacity it plans to assemble over the next seven years, and the IEA projects it will add 340 gigawatts of wind and solar capacity by 2040.