NTPC is a publicly listed company headquartered in New Delhi, India, with 62.09% held by the government of India. In 2020, its revenue was USD14.0 billion and installed capacity was 64 Gigawatts (GW). NTPC currently aims to expand its renewable generation capacity to 60 GW, but it is still heavily reliant on coal-fired power generation. NTPC looks toward coal and gas supplied for fuel security.
NTPC has set a target to reduce its scope 1 emissions intensity by 17% by 2032, compared to 2012. While this target represents a significant increase in ambition relative to the last assessment, where NTPC did not have any targets in place, it is still not ambitious enough to meet the rate of reduction required by the company’s 1.5°C pathway and align with the Paris goals. NTPC is behind in its progress towards this target and will have to increase its efforts to achieve this target. Further, NTPC could aim to be carbon neutral by 2040 as this is aligned with the 1.5°C pathway for electric utility companies with assets in emerging economies.
NTPC increased its scope 1 and 2 emissions intensity from 739 gCO2e/kWh in 2015 to 757 gCO2e/kWh in 2020. This emissions trend was not aligned with the company’s 1.5°C pathway which requires a 5% reduction annually. Based on projected generation trends and the rate that fossil-fuel assets are decommissioned, NTPC will strongly exceed its carbon budget by 2035. NTPC faces the risk of stranded assets due to continued development of coal-fired power generation and lack of coal-phase-out date. Currently 63% of NTPC’s coal-fired generation will remain active in 2040.
NTPC does not disclose financial information on its R&D investments to mitigate climate change. Though NTPC publishes its total CapEx investment for 2020 and planned CapEx for the next five years, it does not publish its mitigation R&D expenditure, or its total fossil and low-carbon electricity portfolio development CapEx for the next five years. Though NTPC plans to expand its renewables capacity to 60GW by 2032, without an indication of any associated investment, it raises questions over how NTPC could achieve this.
Although NTPC has implemented board-level oversight of climate-related aspects, there is no evidence that its board has adequate climate expertise. There is no clear evidence that NTPC has decoupled its management incentives from growth in fossil fuel power generation. NTPC has implemented a transition plan, covering fuel diversification; technology Upgradation & Efficiency Improvement and R&D. However, NTPC did not use climate scenario analysis to inform its objectives, did not consider the implications of a 1.5°C scenario, or investigate climate-related risks or opportunities for the company.
NTPC receives a trend score of -. If the company were reassessed in the near future, its score would likely decrease. NTPC’s future scope 1 and 2 emissions intensity is projected to barely decrease in relation to a business as usual (BAU) pathway. The rate at which NTPC’s future emissions intensity is projected to decrease between 2021 and 2025 should be around eight times higher, to align with its 1.5°C pathway. Without a stronger transition plan, more ambitious targets, greater investment in renewables, and a coal phase-out date, NTPC will most likely further deviate from its 1.5°C pathway.
NTPC plans to reduce its scope 1 emissions intensity by 17% by 2032, compared with 2012. By 2032, NTPC also aims to increase its renewable capacity to 60 GW. Furthermore, NTPC has low-carbon business models which cover e-mobility solutions – which includes battery charging and swapping, electric vehicle charging, and electric vehicle (EV) public transport solutions.
NTPC climate change strategy considers fuel diversification, technology upgrades & efficiency improvement as well as R&D. Furthermore, it plans on increasing the share of renewables in its portfolio and reducing the emissions intensity of its assets through renovation and modernisation.
NTPC has made slow progress towards meeting its emissions intensity targets. NTPC has 12.8 GW of coal-fired generation under development, but currently only 5.1 GW of low-carbon capacity. Furthermore, NTPC is securing coal supplies through a range of contracts and mining projects, citing energy security reasons.
NTPC’s scope 1 and 2 emissions intensity increased from 739 gCO2e/kWh in 2015 to 757 gCO2/kWh in 2020. This emissions trend was not aligned with the company’s 1.5°C pathway which requires a 5% annual reduction. Between 2015 and 2020, NTPC’s own coal-fired generation capacity increased by 15%.
NTPC’s actions are contradictory. Though it is expanding its renewables capacity from 5 GW to 60 GW in 2032, 12.6 GW of coal-fired generation is under development. Its strategy also outlines the renovation and modernisation of assets that have completed 25 years of commercial operation.
Just Transition Assessment
In this report, we present five key thematic findings showing how 180 companies can increase their ambition towards a transition to a low-carbon future that is just and equitable for the people and communities at risk of being affected by it.