India should cut reliance on oil and gas, speed up renewables shift: Power Secretary

India must curb its reliance on oil and gas and quicken the transition to renewable energy as energy security gains urgency in a rapidly changing global environment, said Pankaj Agarwal, Secretary, Ministry of Power.

Addressing the FICCI Indian Power Sector Conference on “Building A Reliable, Flexible And Market-Ready” power system, Agarwal said the latest developments around the Strait of Hormuz underscored the need to replace oil and gas wherever feasible, positioning renewables as a central pillar of India’s energy security.

“Given the outlook after Hormuz, we have to recognise that we must move away from oil and gas wherever possible. There are limits to what can be done. Sun, wind, biomass, perhaps nuclear and coal. So, like it or not, renewable energy is a reality and it is fundamental to our energy security,” he said.

Agarwal said that as renewable energy accounts for a larger share of generation, India will also need to manage variability and create much more flexibility on both the supply and demand sides of the power system.

He added that the sector’s economics and core assumptions have shifted sharply over the past three years, pointing to battery storage costs dropping from about ₹10 per unit in 2023 to around ₹4 per unit now.

He said India is also developing a roadmap to reach 100 GW of nuclear capacity by 2047, while nearly 16,000 MW of pumped storage projects are already under implementation.

Agarwal flagged the geographic clustering of renewable capacity as a key grid-stability concern, noting that large solar and wind additions are concentrated in states such as Rajasthan and Gujarat.

He said the government is pursuing measures such as storage deployment, transmission expansion, time-of-day tariffs and market-based tools to smoothen swings in renewable output.

The Power Secretary said the forthcoming National Electricity Policy will include flexibility requirements for large consumers such as data centres and green hydrogen projects, which can create significant and highly variable demand on the grid.

He also highlighted investment potential in battery and pumped storage, particularly in renewable-heavy states, saying storage can reduce curtailment, support grid operations and enable energy arbitrage.

Agarwal said India should treat emerging grid-stability challenges as a chance to build domestic capabilities in power electronics and other technologies, with an emphasis on “design in India” solutions.