Nikit Abhyankar*
* Corresponding author – nikit@berkeley.edu
Working Paper
India’s electricity demand is projected to nearly double within the next decade, driven by rapid economic growth, industrialization, and rising living standards. At the same time, the country has committed to ambitious clean energy targets, including 500 GW of non-fossil capacity by 2030, 43% renewable energy obligations, and 200–250 GWh of grid-scale storage.
This report evaluates the role of demand-side resources—energy efficiency, load shifting, and demand response—in enabling India to achieve these goals cost-effectively while maintaining grid reliability.
Using detailed PLEXOS-based capacity expansion and dispatch modeling through FY 2032, the study finds that scaling demand-side resources can deliver significant benefits. Doubling appliance efficiency improvement rates could reduce annual electricity demand by more than 200 TWh by FY 2032, avoiding ~150 TWh of thermal generation and ~150 MT of CO₂ emissions. Load shifting of agricultural pumping and select industrial loads to solar hours can unlock ~50 GW of additional renewable integration, while appliance-based demand response can cut storage requirements by ~20 GW, saving $15–19 billion in capital investments. Together, these measures could avoid ~$40 billion in new supply-side investments, reduce annual power procurement costs by ₹120,000 Cr, and raise the clean energy share in generation to ~66% by 2032—up from 55% in a no-flexibility scenario.
Overall, the analysis demonstrates that demand-side resources can substantially lower costs, reduce reliance on expensive thermal generation, and enhance renewable energy integration without compromising energy services, or grid stability. These findings highlight the central role of demand-side measures in powering India’s clean and affordable energy future