India's Energy Transition: Stranded coal power assets, workers and energy subsidies

The document analyzes the causes of financial distress in India's coal power sector, noting that approximately 18 per cent of installed capacity is 'stressed'. It identifies current drivers such as coal shortages and the financial instability of energy distribution companies (DISCOMs), while predicting future pressures from water scarcity, air pollution regulations, and the increasing cost-competitiveness of renewables. The author argues that government subsidies and preferential loans artificially mask these market signals. To prevent the burden of asset stranding from falling on the workforce, the brief suggests implementing complementary policies including general employment schemes, targeted social protection, and specific financing mechanisms.

• Approximately 18 per cent of India's installed coal power capacity is considered 'stressed' and faces the risk of bankruptcy proceedings.
• The current financial stress of coal assets is driven by coal shortages and the financial difficulties of energy distribution companies (DISCOMs), while future stress is expected to be driven by air pollution regulations, water scarcity, and the cost-competitiveness of renewable energy.
• Government support, including subsidies, preferential loan rates, and the failure to enforce air pollution regulations, artificially suppresses market signals that would otherwise increase the costs of coal power.
• To ensure a just transition where workers and communities do not bear the cost of stranded assets, policymakers should implement targeted social protection measures, general employment schemes, and financing mechanisms.
• In FY 2022, India's subsidies for electric vehicles and renewable energy more than doubled, though fossil fuel support remained four times higher than clean energy support; this gap had been nine times greater in FY 2021.

APA

Roberts,, C. B. V. W. (2019). India's Energy Transition: Stranded coal power assets, workers and energy subsidies. International Institute for Sustainable Development. https://www.iisd.org/publications/brief/indias-energy-transition-stranded-coal-power-assets-workers-and-energy-subsidies

Chicago

Roberts,, Christopher Beaton,Balasubramanian Viswanathan,Leah Worrall,Leo. India's Energy Transition: Stranded coal power assets, workers and energy subsidies. International Institute for Sustainable Development, 2019. https://www.iisd.org/publications/brief/indias-energy-transition-stranded-coal-power-assets-workers-and-energy-subsidies.

Wikipedia

{{cite report |last1=Roberts, |first1=Christopher Beaton,Balasubramanian Viswanathan,Leah Worrall,Leo |title=India's Energy Transition: Stranded coal power assets, workers and energy subsidies |publisher=International Institute for Sustainable Development |date=2 April 2019 |url=https://www.iisd.org/publications/brief/indias-energy-transition-stranded-coal-power-assets-workers-and-energy-subsidies |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{roberts2019indias, author = {Roberts,, Christopher Beaton,Balasubramanian Viswanathan,Leah Worrall,Leo}, title = {{India's Energy Transition: Stranded coal power assets, workers and energy subsidies}}, institution = {International Institute for Sustainable Development}, year = {2019}, month = apr, url = {https://www.iisd.org/publications/brief/indias-energy-transition-stranded-coal-power-assets-workers-and-energy-subsidies}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }