India’s role in the global energy system is expected to grow considerably, with its energy demand projected to exceed that of the United States in the 2040s and surpass China in the 2060s, PTI reported, citing a new India-focused scenarios sketch released by Shell India.
The analysis also indicates that the share of fossil fuels in India’s energy mix is expected to peak this decade. However, even as their proportion declines afterwards, total consumption could still increase if global energy demand doubles over the next two to three decades.
Titled ‘India’s energy transition in a security-focused age’, the report presents three potential futures influenced by geopolitics, digitalisation, and climate needs: Archipelagos, Surge, and Horizon.
“India’s energy demand has grown nearly 40 per cent over the past decade due to rapid economic and population growth. The country’s role in global energy will expand, with energy demand surpassing the USA in the 2040s and China in the 2060s,” it was quoted.
Focus on renewable energy
The report underscores a shift from imported fossil fuels to domestically produced renewable energy, enhancing energy security and promoting decarbonisation.
Solar and wind energy have grown from about 3% of final electricity consumption in 2015 to over 20% now and are expected to make up 59% or more of electricity generation by 2050 across different scenarios.
“Low-carbon fuels will play a major role in India’s future energy mix, especially for hard-to-electrify sectors, with strong domestic bioenergy potential and supportive policies driving future growth,” it said. “Fossil fuels share in India’s energy demand peaks this decade; however, the pace of decline thereafter varies significantly across scenarios.”
However, despite the decreasing share, the absolute fossil fuel volumes keep rising across all scenarios, as India’s energy demand doubles in the next two to three decades.
Electricity’s proportion in overall energy demand is now similar to that of advanced economies.
Role of natural gas and LNG
Natural gas and LNG are expected to play a crucial role in the transition, with demand increasing by 50% or more over the next decade to support grid reliability, industrial growth, and AI-driven power consumption.
The analysis underscores the importance of industrial transformation, electrification of transport, scaling low-carbon fuels such as bioenergy and renewable hydrogen, and enabling carbon removals through geological storage and natural sinks.
The report stated that the scenarios are designed to assist policymakers and businesses in managing uncertainty while enhancing India’s long-term energy security, competitiveness, and resilience.
Sharing insights on the report, Mallika Ishwaran, chief economist, Shell was quoted as saying, “India’s energy demand is accelerating and meeting it strategically and securely will require decisive choices and long-term vision.”
She added, “Our new Shell Scenarios Sketch, ‘India’s energy transition in a security focused age’, provides a structured view of those choices through three scenarios Archipelagos, Surge and Horizon shaped by geopolitics, digitalisation, and climate imperatives. By mapping these futures, we aim to help policymakers and businesses navigate uncertainty and strengthen India’s energy resilience in the decades ahead.”
The analysis highlights five key action areas for the next decade, which includes accelerating low-carbon electrification, advancing road transport electrification, enhancing industrial competitiveness, sustaining transition fuels where necessary, and developing investible carbon removal solutions.