India will be largest contributor to global energy demand growth till 2035, says IEA

India will lead global energy demand growth until 2035, focusing on non-fossil sources, aiming for net zero emissions by 2070, and enhancing energy security.

India will be the largest contributor to global energy demand growth till 2035, with its growth in demand being as much as demand growth in China and all Southeast Asian countries combined, according to the International Energy Agency’s World Energy Outlook.

India will be largest contributor to global energy demand growth till 2035, says IEA

India will also be the largest contributor to growth in oil demand also in this period, the second-largest for electricity generation and coal demand growth, and third-largest, for natural gas demand growth, the agency added.

IEA has also projected that the share of non-fossil sources in installed generation capacity which is already 50% in India will rise to 70% in 2035 and that India will account for over 95% of global capacity increase of non-fossil sources by 2035.

Every year between now and 2035, India will add the equivalent of one Bengaluru to its urban population. And every day in this period, it will add nearly 12,000 cars to its roads.

In support of its long-term objective of net zero emissions by 2070, in 2022 India announced an objective to increase the share of non-fossil sources in the power generation mix to 50% by 2030. India met this target for grid-connected capacity in 2025, five years ahead of schedule. “This success was underpinned by surging investment in renewables. In 2015, every dollar invested in fossil power generation sources in India was broadly matched by a dollar invested in non-fossil sources, a 1:1 ratio. By 2025, this ratio had increased to 1:4 in favour of non-fossil sources. Solar PV alone has attracted $ 113 billion in cumulative investment in the past decade, compared with $ 112 billion for all fossil fuel power generation sources combined,” the IEA said.

Non-fossil sources are likely to contribute to over half of electricity generation in India by 2035. This reduces the carbon intensity of electricity generation by nearly 45% to around 400 grammes of carbon dioxide per kilowatthour, which narrows India’s gap with the global average level of carbon intensity of electricity generation. Other benefits include significant declines in emissions of key air pollutants such as fine particulates and sulphur dioxide,IEA has said.

The rising share of variable renewables in power generation brings with it both challenges and opportunities. One challenge is the need for investment in storage and transmission to facilitate the deployment of renewables. Over 230 gigawatt-hours (GWh) of battery storage are likely to be added to the system by 2030. The government is in the process of putting out tenders for new storage capacity.

Traditional energy risks affecting the security of oil and gas supply are now accompanied by other major concerns especially critical minerals due to high levels of market concentration. China mines 50% of the world’s rare earth elements but refines and produces almost 90% of processed rare earth elements and industrial products, utilising extremely polluting and energy-intensive processes.

HT reported on November 10 that access to critical minerals has emerged as a key factor in India’s pursuit of its long-term net zero emissions goal, prompting the country to sign agreements with resource-rich nations including Australia, Argentina and Chile for mining, exploration and investment, whilst launching a ₹34,300 crore (approximately $4 billion) National Critical Mineral Mission to secure supplies amid China’s tightening control over global reserves and processing.

“When we look at the history of the energy world in recent decades, there is no other time when energy security tensions have applied to so many fuels and technologies at once – a situation that calls for the same spirit and focus that governments showed when they created the IEA after the 1973 oil shock,” said IEA Executive Director Fatih Birol in a statement.

“This report confirms India is a global leader in the energy transition, having met its 50% non-fossil capacity target five years ahead of schedule. It proves that ambitious renewable-energy goals are not only possible; they are being delivered in the Global South. India is showing how to power a growing economy with clean energy. The report notes that India is set to be the ‘largest source of energy-demand growth in the world’. Our challenge is to meet this demand cleanly,” said Harjeet Singh, Climate Activist and Founding Director, Satat Sampada Climate Foundation.