Rajasthan could save up to Rs. 85 bn in power procurement costs in 2030 by meeting emerging reliability requirements through renewable energy (RE) and storage instead of new coal capacity, according to a study by the Council on Energy, Environment and Water (CEEW). The study assesses a February 2025 proposal by state distribution companies (discoms) to contract 3,200 MW of new coal capacity.

CEEW said Rajasthan’s projected 2030 shortfall is primarily a timing and flexibility challenge rather than a capacity deficit. Nearly 90 per cent of the projected 5.5 bn-unit shortfall is expected during non-solar hours, when solar generation is unavailable and the grid requires resources capable of responding quickly to demand changes.

Using 15-minute production-cost simulations, the study compared business as usual with two alternatives: adding 3,200 MW of coal capacity, or procuring equivalent energy through a combination of solar, wind and battery storage. The assessment examined whether each pathway could meet demand at the same reliability level in every 15-minute block throughout 2030.

The study found that the proposed coal capacity, designed to generate more than 20 bn units annually, would still leave about 1 per cent of demand unmet while addressing a 5.5 bn-unit deficit. This would fall short of the Central Electricity Authority’s 0.05 per cent reliability benchmark. CEEW recommended scenario-based integrated resource planning, technology-neutral procurement and stronger regulatory capacity to assess proposals independently.

Replacing new coal with RE and storage could generate net savings of Rs. 11.4 bn to Rs. 85 bn in 2030 and help discoms earn Rs. 35 bn by selling surplus electricity on power exchanges. The pathway could also attract Rs. 600 bn in clean-energy investment and create about 27,000 full-time-equivalent jobs, compared with 2,560 under new coal. It would reduce power-sector carbon dioxide emissions by 24 per cent to 52 mn tonnes, against 68 mn tonnes under coal. Rajasthan’s electricity demand grew at an 8 per cent compound annual growth rate between FY22 and FY25 and is projected to reach 1.5 times FY25 levels by FY30.