Impact of demand growth on decarbonizing India's electricity sector and the role for energy storage

Global energy sector decarbonization efforts are contingent on technology choices for energy production and end-use in emerging markets such as India, where air conditioning (AC) is expected to be a major driver for electricity demand growth. Here, we assess the impact of demand and supply side-drivers on the long-term evolution of the electricity sector in India under various technology and policy scenarios. Our analysis is based on developing: (a) multiple demand scenarios produced from a bottom-up forecasting model with high temporal resolution that capture structural changes in electricity consumption resulting from (AC) and electric vehicle (EV) adoption, and (b) a multi-period power system capacity expansion model with high temporal resolution of grid operations to model supply-side evolution in response to changes in demand and technology and policy factors. Such a framework allows us to, for example, quantify the impacts of improving appliance efficiency standards for AC systems or shifts in EV charging patterns on power system decarbonization prospects. Under projected renewables and Li-ion storage cost declines, our modeling points to solar and wind generation contributing substantially (46-67%) to meet annual electricity demand in India by 2030. However, without appropriate policy measures to phase out existing coal generation, even such rapid adoption of variable renewable energy coupled with one or more technological levers such as low-cost energy storage and demandside measures such as setting aggressive AC efficiency standards and deploying distribution level storage, are insufficient to reduce annual CO2 emissions in 2050 vs. 2020 because of the relatively higher growth rate of projected electricity demand over this period. This suggests that deep decarbonization of India's power sector will require policy measures beyond efforts related to accelerating renewables deployment.