Biden at G20: India and US Forge $1 Billion fund for renewable energy - Moneycontrol

Biden at G20: India and US Forge $1 Billion fund for renewable energy

Hours before the G20 Summit in New Delhi, US President Joe Biden and Prime Minister Narendra Modi held a bilateral meeting on September 8 in which the two countries agreed to set up a Renewable Infrastructure Investment Fund with investments of up to $1 billion ($500 million each).

The two leaders also agreed to cooperate on accelerating nuclear energy for the power sector in India; piloting and testing innovative technologies along with training and skill development for the adoption of new and emerging renewable technologies and energy systems; and collaborating to diversify the supply chain for electric mobility.

India and the United States have also made progress toward the creation of investment platforms to lower the cost of capital and accelerate the deployment of greenfield renewable energy, battery storage, and emerging green technology projects in India.

“Towards this end, India’s National Investment and Infrastructure Fund and the U.S. Development Finance Corporation exchanged letters of intent to each provide up to US$500 million to anchor a renewable infrastructure investment fund,” read the joint statement issued by the White House shortly after Biden and Modi held bilateral talks in New Delhi.

Harnessing Nuclear Energy

India currently has an installed nuclear power capacity of 6,780 MW, which is just 2 percent of the total energy (thermal, hydro, renewables) mix in the country. The country is now trying to harness nuclear energy, apart from renewables, for power generation as nuclear power is also a zero-emission clean energy source.

After a long gap, the Indian government recently gave approval to install 10 nuclear reactors to meet the country's growing power demand. Several Central Public Sector Undertakings (CPSUs) are also working on setting up small modular reactors, which are cheaper and take less time to install. However, small modular reactors are a relatively new technology in India, with negligible installations in the country.

The United States, in the bilateral meeting, reaffirmed its support for India’s membership in the Nuclear Suppliers Group.

The support from the US in this sector is significant because the Indian government is planning to allow foreign investment in nuclear power.

“Reiterating the importance of nuclear energy as a necessary resource to meet our nation’s climate, energy transition, and energy security needs, Prime Minister Modi and President Biden welcomed intensified consultations between the relevant entities on both sides to expand opportunities for facilitating India-U.S. collaboration in nuclear energy, including in the development of next-generation small modular reactor technologies in a collaborative mode,” read the statement.

Green Energy Technology & Skilling

The two countries have set up the ‘India-U.S. Renewable Energy Technologies Action Platform [RE-TAP],’ which held its inaugural meeting in August.

The joint statement issued by the White House on September 8 stated that the two countries will engage in lab-to-lab collaboration, piloting, and testing of innovative technologies; and collaboration on policy and planning to advance renewable energy and enabling technologies investment, incubation, and outreach programs.

They will also undertake training and skill development to accelerate the uptake and adoption of new and emerging renewable technologies and energy systems, according to the statement.

This is significant because India is aiming to have an installed renewable energy (RE) capacity of 500 GW by 2030 and achieve net-zero emissions by 2070. To achieve these targets, India is using a multi-pronged strategy, from accelerating RE deployment and promoting energy storage systems to supplying round-the-clock RE power and introducing alternate fuels such as green hydrogen, for which the country introduced the National Green Hydrogen Mission (NGHM).

All of these initiatives would require technology, price competitiveness, model projects, investments, and capability building through training and skilling. The Renewable Infrastructure Investment Fund is a step toward achieving these goals in the Indo-US collaboration, officials in the Ministry of New and Renewable Energy said.

Regarding e-mobility to decarbonize the transport sector, the joint statement expressed joint support for a payment security mechanism financed through both public and private funds, which will accelerate the procurement of 10,000 made-in-India electric buses, including those for the Indian PM e-Bus Sewa program. This will also include the associated charging infrastructure.

“The two countries are committed to working together to help diversify the global supply chain for e-mobility,” read the joint statement.