India’s Energy Transition: The cost of meeting air pollution standards in the coal-fired electricity sector

The document estimates that installing pollution-control technology for sulphur dioxide (SO2), nitrogen oxides (NOx), and particulate matter (PM) in India's coal fleet requires between INR 73,176 crore and INR 86,135 crore. This investment is expected to increase electricity tariffs by 9% to 21%, with the highest impact on 500 MW units. The report highlights significant barriers to meeting the December 2022 compliance deadline, including high upfront costs, financial stress among distribution companies, and a lack of technical experience. It recommends that costs be passed to consumers to reflect externalities, that the poorest be protected via targeted subsidies, and that continuous emission monitoring system (CEMS) data be made public to ensure transparency.

• The total capital expenditure required to install pollution-control technology for SO2, NOx, and PM is estimated at INR 86,135 crore (USD 12 billion), or INR 73,176 crore (USD 10 billion) if plants scheduled for retirement by 2027 are excluded.
• Retrofitting will increase coal power plant tariffs by between INR 0.32 per kWh and INR 0.72 per kWh, representing an increase of approximately 9% to 21% to average generation tariffs. The most significant increases are faced by average 500 MW units due to more stringent requirements and shorter remaining useful life.
• SO2 abatement represents the vast majority of the required capital expenditure, accounting for approximately 81% of the total, while NOx-control and electrostatic precipitator retrofits account for 16% and 3% respectively.
• Many coal plants are likely to miss the December 2022 compliance deadline because 42% of non-compliant plants had not issued tender notifications as of the report's writing, and flue gas desulphurization (FGD) construction typically takes 18–30 months.
• Private power producers are the least likely to meet compliance targets due to financial stress and difficulty in obtaining commercial finance, whereas centrally owned (NTPC) and state-owned generators have better access to funds.
• The financial instability of electricity distribution companies creates uncertainty regarding their ability to recover increased tariffs from consumers, despite the 'Change in Law' notification of March 2018 allowing costs to be passed through.
• The public health costs of air pollution from power plants significantly exceed the cost of retrofitting; non-compliance between 2019 and 2030 is estimated to cause 300,000–320,000 premature deaths and 51 million hospital admissions for respiratory disorders.
• To ensure transparency and verify that higher tariffs result in actual health benefits, the data from continuous emission monitoring system (CEMS) devices must be made available to the public and regulators.

APA

Garg, V., Narayanaswamy, D., Ganesan, K., & Viswanathan, B. (2019). India’s Energy Transition: The cost of meeting air pollution standards in the coal-fired electricity sector. International Institute for Sustainable Development. https://www.iisd.org/system/files/2020-08/india-energy-transition-air-pollution-standards.pdf

Chicago

Garg, Vibhuti, Danwant Narayanaswamy, Karthik Ganesan, and Balasubramanian Viswanathan. India’s Energy Transition: The cost of meeting air pollution standards in the coal-fired electricity sector. International Institute for Sustainable Development, 2019. https://www.iisd.org/system/files/2020-08/india-energy-transition-air-pollution-standards.pdf.

Wikipedia

{{cite report |last1=Garg |first1=Vibhuti |last2=Narayanaswamy |first2=Danwant |last3=Ganesan |first3=Karthik |last4=Viswanathan |first4=Balasubramanian |title=India’s Energy Transition: The cost of meeting air pollution standards in the coal-fired electricity sector |publisher=International Institute for Sustainable Development |date=August 2019 |url=https://www.iisd.org/system/files/2020-08/india-energy-transition-air-pollution-standards.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{garg2019indias, author = {Garg, Vibhuti and Narayanaswamy, Danwant and Ganesan, Karthik and Viswanathan, Balasubramanian}, title = {{India’s Energy Transition: The cost of meeting air pollution standards in the coal-fired electricity sector}}, institution = {International Institute for Sustainable Development}, year = {2019}, month = aug, url = {https://www.iisd.org/system/files/2020-08/india-energy-transition-air-pollution-standards.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }