Assam, a state in northeastern India, has backed off a pledge to subsidize clean energy investments.

What's happening?

In February, officials announced a policy to attract businesses with incentives and waivers, Reuters reported. Months later, it was withdrawn without explanation.

The policy originally "offered subsidies on power transmission and eased bank guarantee requirements to support clean energy projects in the state," the news agency explained, noting the region has lagged behind in developing such infrastructure.

It added that companies NTPC Green, Larsen & Toubro, Sembcorp, and Ocior had bid for "green hydrogen" projects in Assam. An NTPC executive told Reuters that inconsistent policies create hurdles for planned investments.

Why is this important?

While India has been heavily reliant on coal, renewables accounted for 50% of its energy capacity for the first time earlier this year. The milestone came five years before the country's goal under the Paris Agreement, according to Agence France-Presse. 

With the largest population in the world, India is the third-leading contributor of heat-trapping gases in the atmosphere, though its per-capita pollution rate has been one-third the global average. Still, there's a difference between capacity and generation, and almost 75% of its power comes from coal.

Coal is the dirtiest of the dirty fuels, polluting the air and environment as it is mined and burned. To improve public and planetary health, India has been moving to cleaner, more renewable energy sources. Its goal is to cut emissions intensity by 45% by 2030 and reach net-zero carbon pollution by 2070, per AFP.

Of course, muddying investment paths and possibilities could pose major barriers to these aims.

What's being done about Assam's renewable energy reversal?

In July, Reuters reported that Assam's reversal was a "setback to investors." The country's coal reliance and growth will continue, but the industry is working to make it cleaner in part by reforesting former mining sites.

Until battery storage options can be scaled to pair with solar power generation, increasing demand for energy — driven by rising global temperatures and resulting air conditioning needs — is set to be met through other methods, Reuters noted in a separate report. 

Policy backtracking in Assam notwithstanding, solar and other renewables are becoming cheaper and coal more expensive, so it may just be a matter of time before clean energy surpasses coal in India.

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