For India’s two richest men, the year 2021 was all about clean energy.

At a time when the country was going through an acute coal shortage, Gautam Adani and Mukesh Ambani were chalking out strategies for clean energy, steadily shifting away from their traditional coal and petrochemical businesses.

Experts believe their entry will stimulate the sector and encourage others to look at clean energy.

“There will be some consolidation but it will encourage the entry of more serious players to offer solutions across the value chain,” said Vibhuti Garg, energy economist at the US-based Institute for Energy Economics and Financial Analysis. “The approach is now to build an entire ecosystem, which brings in the role of different technology solution providers.”

Green energy bet

India has been trying to increase its green energy capacity over the past few years. However, targets were mostly missed due to a lack of economic viability of projects and will among authorities.

For the year 2022, the country has set an ambitious target of 175 gigawatts of renewable power. Energy pundits believe this goal will be missed again.

“We estimate India to achieve only about 110 gigawatts by the end of the next year,” Vinay Rustagi, managing director of a renewable power consultancy, Bridge to India told Mongabay-India in June this year. India’s total renewable energy capacity, including small hydel projects, is now estimated to be around just 100 gigawatts.

However, hopes are now pinned on Ambani, whose entry into the sector in June is being read as a sign of the end of the oil era. His Reliance Industries, a fossil fuel giant, announced a Rs 75,000 crore renewables investment plan.

“We will transform our legacy business into a sustainable, circular and net-zero carbon materials business…(and) help transition India and the world from industrial civilisation to an ecological civilisation,” the 64-year old billionaire said during the company’s annual general meet in June.

“Surya dev has blessed India with almost limitless sunlight,” Ambani said. “I envision a future when our country will be transformed from a large importer of fossil fuels to a large exporter of clean, solar energy solutions.”

At the same meet, Ambani also announced a 5,000-acre green energy giga complex in Jamnagar, Gujarat.

If everything goes according to his plan, Reliance alone will be responsible for meeting a fifth of India’s 2030 new energy target – last year, Prime Minister Narendra Modi set a target of 450 gigawatts of green energy by 2030.

Experts also think Ambani’s push will help India create a value chain for the future, reducing its dependence on international factors.

For the year 2022, India has set an ambitious target of 175 gigawatts of renewable power. Photo credit: Sam Panthaky/ AFP

“Ambani is acquiring or tying up with established technology leaders, be it battery storage, green hydrogen, or solar module manufacturers…If successful, this will help strengthen India’s input value chain and help protect the country from the vagaries of price volatility internationally,” Garg of Institute for Energy Economics and Financial Analysis said.

Gautam Adani, the other businessman in the spotlight, is also keeping up.

Adani’s green push

In October, India’s clean energy sector got a massive push with the completion of Adani Green Energy’s 100% acquisition of Soft Bank’s SB Energy at $3.5 billion for a total capacity of 5 gigawatts. The deal was termed one of the largest in the country’s renewable sector.

Adani also plans to invest $70 billion in the next 10 years across renewable energy generation, component manufacturing, transmission, and distribution.

“By 2030, we expect to be the world’s largest renewable energy company without any caveat and we have committed $70 billion over the next decade to make this happen,” Gautam Adani said during a Bloomberg event in November. “There is no other company that has yet made so large a bet on developing its sustainability infrastructure.”

In December, Adani Green Energy signed, what the company claims is, the world’s largest evergreen power purchase agreement with the Solar Energy Corporation of India to supply 4,667 megawatts of green power.

Notably, Adani Group is already the world’s largest solar power developer.

Energy duopoly?

What is it that encouraged these bigwigs to take the new energy sector seriously?

Garg believes while clean energy is “commercially lucrative”, there has been immense pressure from the company boards as well.

“The respective board rooms are asking these players to shift their strategy and increase their clean energy portfolio,” she explained. “The decisions are more economically driven as renewable energy provides better returns to investors.”

And it is not that Ambani and Adani are the only two serious players.

For instance, a few months ago Tata Power said it will no longer build coal power plants and, instead, aim to achieve carbon neutrality by 2050. In June, state-owned NTPC, India’s largest energy conglomerate, said it will double its renewable energy capacity to 60 gigawatts.

Meanwhile, there also has been massive capital movement into the sector.

The Indian Renewable Energy Development Agency, for example, sanctioned a $184 million loan to renewable energy developer Vector Green in October. In the same month, Cleantech Solar raised $26 million in debt from National Infrastructure Investment Fund, a sovereign wealth fund partly owned by the centre and backed by some of the largest banks of the country such as ICICI, HDFC, Axis and Kotak Mahindra.

Difficult road

The growing interest aside, India is still far from achieving total independence from thermal energy. As of now, around 70% of the power consumed in India comes from coal-based plants.

Garg says the onus for a more emphatic shift to renewables lies with the government.

“The government needs to provide favourable policies for inviting more participants,” she said. “The private sector will be able to operate if the policy landscape is favourable. The government should ensure policy certainty and financial health of distribution companies would also be key for greater deployment of renewable energy.”

Until then, though, it is the corporate giants who will define India’s green energy era.

This article first appeared on Quartz.