Chhattisgarh’s abundant coal resources, thermal power plants, and industrial growth make it the ‘Power Hub of India’. The state holds ~80 billion tonnes of coal reserves as of April 2023, making it the third largest coal-bearing state in India after Jharkhand and Odisha. The state is responsible for around 10% of India’s total power production as of 2023. And is also one of the few states that have ‘Surplus Power’. It is among the few profitable states in terms of utility-based electricity. Thermal accounts for ~93% of the installed power capacity and renewable energy about 7% (includes solar PV, biogas, and small-hydro plants). Focusing on Korba district, called the ‘Power Capital of India’, houses more than 15 numbers of large-scale thermal power plants (coal-based) and contributing a significant share to state’s power generation and national power grid. NTPC Korba, Korba Super Thermal Power Station, Lanco Amarkantak Power Plant, Jindal Power Limited (Tamnar) are some of the major power plants in Chhattisgarh. The state’s favourable location near coal mines helps minimize transportation costs and ensures an uninterrupted supply of coal to power plants.
Additionally, it has made significant contributions to India’s industrial sector, especially in steel (Bhilai Steel Plant), aluminium (BALCO) etc. While this supports industrial growth and energy security, it also leads to high emissions and environmental degradation as they are hard-to-abate segments. The increasing industrial demand for energy further intensifies pressure on coal resources, creating a dilemma between meeting energy needs and addressing environmental concerns.
India pledges to reach net-zero emissions by 2070 and aims to increase the share of non-fossil fuel energy to 50% by 2030, Chhattisgarh faces mounting pressure to transition from a coal-dependent and industry heavy economy to one powered by renewable energy sources. There is a huge untapped potential lying in key industrial clusters of the state – Durg, Bhilai, Raigarh, Bilaspur and Korba to emerge as a leader in green energy.
Chhattisgarh Green Summit held on October 2024 is inception to new era for clean future energy and industries; emphasizing on carbon credits. With the right strategies, policies and investments, Chhattisgarh can pivot towards cleaner energy, low-carbon future while preserving economic growth and jobs.
Challenges and implications of transitioning to sustainable energy
Chhattisgarh’s economy has been dependent on coal, with around one-in-five jobs are from coal mining and coal-related industries. Moving away from coal could lead to significant job losses and social challenges.
Transitioning the state’s energy infrastructure to renewable sources will require massive investment, in sustainable industries (electrification of industries, biomass as a fuel, heat pumps as an alternative) and renewable energy, electric vehicles and charging infrastructure over the next decade.
Furthermore, renewable energy sources like solar and wind pose reliability issues, especially for industries needing uninterrupted power. The state must also overcome its historical association with coal, requiring policy reforms and a strategic communication effort to gain investor and public trust in green, battling a long-standing perception issue. This transition will require both substantial policy reform and a coordinated communication strategy to promote the state’s new direction.
If Chhattisgarh fails to embrace the green energy transition, the consequences could be dire for both the state and the nation. Economically, continued reliance on coal could render Chhattisgarh vulnerable to the global shift towards low-carbon energy. As more industries and investors prioritize sustainability, coal-dependent regions could find themselves isolated. The International Energy Agency (IEA) predicts that global coal demand will peak by 2025, with demand declining thereafter. This shift could result in reduced investments in Chhattisgarh’s energy sector and lead to job losses, decreased competitiveness, and could lead to economic stagnation and social unrest, further impeding the region’s development.
On an environmental front, Chhattisgarh is already facing severe consequences of coal dependency. The state ranks among the top in India for air pollution, with cities like Raipur and Korba frequently recording dangerous air quality levels due to emissions from coal-fired power plants. Furthermore, continuing elevated levels of greenhouse gas emissions from Chhattisgarh’s coal plants would significantly hinder India’s ability to meet its climate goals, undermining international commitments made under the Paris Agreement.
Decarbonizing strategies for Chhattisgarh’s coal-based power sector and hard-to-abate industries
Despite challenges, Chhattisgarh is well-positioned to lead India’s energy transition. With vast land and favorable climate, the state is ideal for renewable projects, particularly solar, biomass, wind, hydrogen projects and eventually carbon capture. Its current renewable energy capacity of 1600 MW could significantly grow, in various dimensions.
Transition to green steelmaking industries: Chhattisgarh’s steel sector could shift from coal-based processes to green hydrogen-powered steelmaking [Hydrogen-based Direct Reduced Iron (H-DRI) & Electric Arc Furnace (EAF)]. By 2030, the LCOS will reduce by 17% in Bhilai Chhattisgarh with average blast furnace costs and can cut down emissions. EAFs primarily use scrap steel, promoting recycling within the state could complement this transition.
Carbon Capture, Utilization, and Storage (CCUS): CCUS technology can be deployed in the state’s steel, coal, and cement plants to capture CO2 emissions before they are released into the atmosphere. This captured CO2 could be either stored underground or used in other industrial processes, such as producing chemicals like synthetic fuels, plastics, or construction materials, creating new economic opportunities. Dalmia Cements is all set towards 500,000 tonne per year carbon capture facility at its cement plant at Tamil Nadu, with CCSL and some of the public sector undertakings such as NALCO, ONGC, and BHEL are taking up CCS pilots (MoEFCC 2021).
Renewable energy integration: CREDA is already leading its ways towards RE expansion, which could help decarbonize both industrial and power generation sectors. 2,500 government buildings, residential schools, and health centers are now powered by solar energy. CSERC has made policy changes like exemptions in open access, new banking and settlement proposals for boosting RE projects.
Recently, SAIL – Bhilai Steel Plant (BSP) has installed 15 MW capacity captive floating solar plant in its Maroda-1 reservoir . Similarly, commissioned India’s largest solar plant, featuring a capacity of 100 MW, with battery storage of 3 hours (or 40 MW/120 MWh), supported by the World Bank and Climate Investment Fund, where industries can operate on a cleaner energy mix.
Electrification of process and energy efficiency improvements: Upgrading technologies like heat pumps, EAFs and energy efficiency programs in industries and implementing digital solutions like AI and IoT to optimize industrial operations can improve efficiency, reduce energy use, and especially those involved in steel, cement, and power, could result in significant emission reductions.
Promotion of biomass and waste-to-energy solutions: Industries can replace some of their coal consumption with biomass-based fuels, such as agricultural residues or biogas. Using local biomass resources reduces dependence on fossil fuels while fostering a circular economy. More industries should be encouraged by government for biomass-based power. Godawari Power and Ispat Limited (GPIL) has installed a 20 MW biomass-based power project that generates electricity using rice husks from local communities.
Waste Heat Recovery Systems: Implementing energy efficiency measures like waste heat recovery in industries (especially steel and cement) can reduce overall energy consumption and carbon emissions.
Community Engagement Programs: Engaging with local communities to raise awareness of the benefits of renewable energy is critical, emphasizing the long-term environmental and economic benefits of transitioning to green energy. CREDA has installed more than 150,000 solar irrigation pumps and 230 solar-powered community irrigation systems, as well as 25,000 solar drinking water pumps benefiting over 6.5 lakh families. The concepts like Agrivoltaics getting commercialized in agriculture dominant regions, which can provide additional source of income to farmers when they lease their land for solar panels and can support water pumping. This will help in water consumption with boost in yield of vegetables.
The future outlook
Chhattisgarh’s initiative-taking policy reforms and incentives are attracting investments from the private sector, encouraging innovation in the clean energy space. The state is leading way in fostering collaborations between government, industry, and research institutions to develop innovative renewable technologies and enhance energy efficiency. However, green hydrogen, carbon capture, electrification of industries and efficiency measures are the untapped areas where the state needs to take effective steps.
Payal Saxena has 9 years of experience in Renewable Energy, Energy Transition, and Utilities. She has worked extensively with Global Utilities, IPPs, and Industries on developing Renewable & Decarbonisation strategies, policy advocacy initiatives, techno-economic analysis, business and operating models, to facilitate a low carbon economy, systemic efficiency, and net zero transition.
