Lower C&I Tariffs, Residential Support Can Boost RE Shift: CEEW

Lower C&I Tariffs, Residential Support Can Boost RE Shift: CEEW

A new report by the Council on Energy, Environment, and Water (CEEW) and the Alliance for an Energy-Efficient Economy (AEEE) finds that power pricing reforms can drive equitable and scalable electrification. The report highlights that reforms promoting greater rooftop solar penetration in residential buildings and rationalised tariffs for commercial and industrial users are key to accelerating electrification and clean energy adoption. The study also finds that gradually phasing out residential subsidies could boost rooftop solar uptake, provided targeted support continues for low-income households.

The study shared the findings based on the following scenarios: 

• Continued reductions in emission intensity across scenarios: Across all scenarios explored, there is a continued drop in emission intensity in the future. Moreover, emissions intensity reductions are higher for greater economic growth led by a increase in manufacturing share, especially  as new energy demand is met by clean technology. However, this high growth will also have higher absolute emissions if fossil-reliant industries continue to grow.
• Improvements in energy efficiency and behavioral and lifestyle changes: Changes ranging from reducing private vehicle use and adopting energy-efficient appliances to optimizing residential energy use and material consumption deliver the highest emission reductions. These could deliver up to 10 percent emissions reductions by 2050 relative to business-as-usual, as well as reduce the pressure on land resources while achieving the net-zero target.
• Complementary policies help reduce carbon price to the economy: Complementary policies and initiatives beyond carbon pricing alone, reduce overall cost to the economy as well as reduce pressure of land requirements for the energy transition.

Vaibhav Chaturvedi, Senior Fellow, CEEW, said, “It has also proven that growth and emissions reduction can happen together. This paper reaffirms that with decisive reforms—across electricity pricing, industrial planning, nuclear electricity, lifestyle change, and urban mobility—India can significantly bend its emissions curve towards net zero. As we head into COP30 this year, India’s 2035 NDC must reflect not only enhanced ambition but also economic realism, supported by analytical assessments. A well-calibrated strategy should include an economy-wide emissions intensity target, sector-specific carbon budgets, and a push for low-carbon technologies and clean manufacturing. Only a deliberate, policy-led pathway can shift India onto a resilient and equitable low-carbon track.”

Satish Kumar, President, and Executive Director, AEEE, said, “By integrating key energy efficiency parameters as endogenous variables in the underlying climate model, our paper breaks new ground in capturing the real-world potential of demand-side interventions. This approach makes the model more robust and reflective of India’s development realities. It also signals a shift toward more holistic climate policymaking where both the demand and supply side are examined in tandem, unlocking co-benefits across equity, resilience, and sustainable growth.”

Transport Sector Needs High EV Adoption & Public Transport Push

Transport transformation offers emission reduction opportunities, along with air quality gains and reduced travel time in cities. A central priority is to re-engage people with public transport—especially buses—by making it more reliable, accessible, and aspirational.

Currently, buses account for 38 percent of total passenger-kilometres, but this could fall to just 10 percent by 2070 under the BAU scenario. Even doubling that share would reduce road transport emissions by only ~three percent, as most people would shift to two- and three-wheelers or walking. This makes clear that alongside a public transport revival, ambitious electrification that includes buses, two- and three-wheelers, and private vehicles is essential to manage rising travel demand and reduce emissions. Achieving this requires targeted subsidies, charging infrastructure, better bus stops, cycle lanes, and congestion disincentives to shift consumer behavior at scale.

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