Page 162 - Hitachi IR 2025

MANAGEMENT DISCUSSION & ANALYSIS
Strategic Opportunities
Key growth drivers for power sector
Demand for energy: Rising incomes and
improving living standards will drive the
demand for appliances, air conditioners
and vehicles. India is now the world’s
third-largest energy consumer,
with a significant increase in energy
consumption since year 2000. With
a growing population and increasing
urbanization, India needs to expand its
power system equivalent to the size
of the European Union to address its
growing need for electricity by 2040.
(Source: IEA)
Climate change: With a focus on self-
reliance, India aims to generate 500
GW of non-fossil energy by 2030,
reducing dependence on fossil fuels
and mitigating climate change. These
efforts align with India’s commitment
to a sustainable and resilient future.
To tackle environmental challenges,
the Indian government implemented
energy-efficient initiatives like the Gram
Ujala program, providing affordable LED
bulbs to rural areas.
Cost-effective: Renewable energy
is cheaper than traditional energy
sources, with lower costs on setting up
generation infrastructure.
Geographical advantage: India’s
tropical climate, high solar irradiation,
extensive coastline and strong winds
offer significant potential for developing
renewable energy resources.
Scalable: Renewable energy is a clean
and sustainable energy source. It is a
scalable and effective solution to fight
global warming.
Government support: The Indian
government actively encourages the
adoption of renewable energy and
acknowledges its potential to meet
the country’s growing power demand.
It provides customs and excise duty
provisions for solar rooftops and
offers incentives to promote private
sector investments.
It has also introduced solar parks under
the ‘Make in India’ initiative.
160 Hitachi Energy India Limited
Government policies and initiatives
The Government has identified the power sector as
a key sector of focus to promote sustained industrial
growth. Some initiatives by the Government to boost
the Indian power sector are as below:
• The Government implemented multiple initiatives
aimed at ensuring uninterrupted power supply
to every household. Under the Deen Dayal
Upadhyaya Gram Jyoti Yojana (DDUGJY),
Integrated Power Development Scheme (IPDS)
introduced in 2014, and the Pradhan Mantri Sahaj
Bijli Har Ghar Yojana (SAUBHAGYA), introduced
in 2017, about ` 1.85 Lakh Crores has been
invested to boost distribution infrastructure across
various states. Consequently, 18,374 villages have
been electrified under DDUGJY, and 2.90 Crores
households have gained access to electricity
through SAUBHAGYA.
• Since July 2021, the government is implementing
the Revamped Distribution Sector Scheme to
enhance the quality and reliability of the power
supply for consumers. This initiative aims to
create a financially sustainable and operationally
efficient distribution sector. With a total outlay of
` 3.00 Lakh Crores and gross budgetary support
of ` 97,631 Crores allocated for the period from
FY 2021-22 to FY 2025-26, projects worth
` 2.80 Lakh Crores have been approved to
develop distribution infrastructure and implement
smart metering solutions.
• The Government has approved new Inter State
Transmission System (ISTS) schemes to evacuate
9 GW of RE power from Rajasthan and Karnataka.
These schemes will be implemented through
Tariff Based Competitive Bidding (TBCB) mode.
These schemes are part of the 500 GW renewable
energy capacity by 2030, out of which 200 GW
has already been connected.
• The Union Cabinet has sanctioned the PM-Surya
Ghar: Muft Bijli Yojana. This initiative, with a
total budget of ` 75,021 Crores aims to install
rooftop solar systems and offer complimentary
electricity of up to 300 units per month to one
crore households.
• In the Union Budget FY 2024-25, the
government's power sector initiatives have been
allocated funds that are 50% higher. Increased
funds have been allocated to green hydrogen,
solar power, and green-energy corridors in line
with the renewable energy target for 2030.
• In the Union Budget FY 2022-23, the
government allocated ` 7,327 Crores for the
solar power sector, including grid, off-grid, and
PM‑KUSUM projects.
• In the Union Budget FY 2022-23, the government
announced the issuance of sovereign green