India’s investments in renewable energy will exceed expenditure on power plants based on fossil fuels, which are globally seen as polluting. Coal, power and renewable energy minister Piyush Goyal says the message is loud and clear that the country’s investment thrust will be towards renewables.Goyal, who says he is inaccessible to industrialists unless they meet him in a group, also tells in an exclusive interview that his government and the states will ensure that losses of state distribution companies (discoms), which exceed Rs 60,000 crore, will be wiped out completely by 2019. The minister says this will happen without big increases in tariffs and a new tariff policy will give a big boost to renewable energy and encourage waste-to-power plants, which will also help the Swachh Bharat campaign of Prime Minister Narendra Modi. Edited excerpts:Transparency is the hallmark of Prime Minister Modi’s government. If you look back in history, we feel linkages were also given on a first come, first served basis. Whoever applied was very often promised more than what CIL (state-run monopoly miner Coal India) could deliver. There has been a kind of stalemate in the entire linkage process for several years. We are trying to bring in transparency in that also. We will, for the nonregulated sector, auction out longer term commitment to supply from Coal India so everybody has an equal chance to participate.For power, we will give coal linkage to states that need more power and they can bid out. We believe this will bring down cost significantly. Otherwise, when a company gets a linkage, it has the ability to dictate terms. If the discom has linkage then all bidders are on an equal footing. One of the reasons I’m confident of resolving the discoms’ problem is that my effort is towards cost reduction and efficiency improvement, not only tariff increase.The proposal has three dimensions. One is, what do we do with the past, something I’ve inherited. We are sorting out what needs to be done for the past. Second, we are working on a three-year plan to bring down aggregate technical and commercial (AT&C) losses to 15% nationally from 27% now. This cannot be brought down in five, 10 or 15 years, the way they used to think in the past. In my view, it has to be done fast. In three, three-and-a-half years I want to bring national losses down to 15%. We have to improve efficiency, create infrastructure; see where energy efficiency can bring down consumption, especially peak consumption.Costs can come down 10% by efficiently managing coal and its output. NTPC’s assessment is that its power costs can come down about10%. That’s the three-year programme in which we hope that other than routine regulatory increases, which the regulator passes, we may not need a very significant increase. The third is for the future, to provide for a hard budget constraint so banks don’t lend indiscriminately to discoms and states are conscious they can’t allow discoms’ losses to accumulate over a long period of time. They become more responsible. Fortunately all states have agreed with us. Now we are fleshing that out in more detail. In three years, Rs 60,000-70,000 crore loss of discoms will be zero by 2019.It will come over a longer period of time from within the state’s resources. We don’t know how. We don’t decide what states do with their money.As far as the carrot goes, I’m not giving any cash subsidy or money like that. But in the last 17 months, not a single state that has come to meet me has gone back emptyhanded. Not in a single state review meeting have we passed on things to be resolved to be taken up in the future. I’m very confident. There will be a hard budget constraint. In future, you have to recognise that this is a state government responsibility and fund it.It will be a gradual process. We have discussed with states involved, and we’ve come to a solution for needs to be done for the past along with the RBI, banks, states and the Centre. All have together come to a solution.There will be a major change in the renewable sector. We’ll be bringing much tighter commitment both for renewable purchase obligation (for discoms), and we are introducing for generating companies an installation commitment. A company setting up a coal plant will also have to set up a renewable plant. There will be a greater thrust on competitive bidding in transmission, power purchase, at the same time giving states the ability to encourage capacity increases, by increasing existing capacities liberally.I don’t want projects to take 10 years to set up. That adds to the cost. My own sense is more and more projects will come on existing sites. For wind, we want old capacity to be replaced by bigger, modern capacity. Plants should expand capacity at same location. An old plant has land, water, environment clearance. You can quickly set up additional capacity. We are also providing that for renewable energy there will be no interstate transmission charges. Wherever waste to energy – as part of waste-to-wealth that the prime minister has articulated – can be set up, must be set up and state will have to buy that power.We will integrate it with Swachh Bharat. Similarly, for municipal waste water, wherever it can be processed, we will encourage treatment. Processed water will be used by thermal plants, which will free up fresh water. Then microgrids. Why are people not setting up microgrids in remote areas? Because they are concerned what happens when the grid reaches there. We are providing; get the regulator to confirm your project economics and whenever grid reaches there, they will at depreciated value assess the rate at which power will be fed into it.In terms of installed capacity, it will also happen in India. Already, we are not encouraging any fossil fuel projects. We are completing stalled ones. A few UMPPs will come up. In the next two-three years, I don’t see the possibility of fossil fuel plants. I have enough capacity to double power generation in the next five-seven years. So now I’ll be planning for seven years and beyond. Investment thrust will be totally skewed towards renewable. That’s loud and clear. It also adds to energy security and environment protection.Two things. One is, renewable provides you a tariff that remains constant for 25 years. That’s a great advantage, because in fossil fuels, if you see the trajectory for the last 25 years, costs have shot up like anything. Rail freight, environmental costs, carbon capture will come into play. With transparency in renewables, the prices of renewables are coming down drastically.For projects already in pipeline, I’m not going to waste national assets. I’ll need it going forward. I’ll focus on coal, gas, transmission, replacement of old plants. One of my first decisions I took as minister was to allow old and inefficient plants that pollute the maximum, to be replaced with supercritical modern plants. I’ve not kept a restriction: if you are closing a100 mw plant you can set up 600 mw, but supercritical.This is a big problem in India. For years, people thought whatever we do, the government will bail us out. I think rules have changed. It’s an equal opportunity, fair and transparent government. We do things in public domain. We didn’t press the button on their computer screens at the time of biding. In the bid document, it is mentioned five-six times you have to bear whatever you bid. It will not be allowed to be passed on to the consumer. Out of 35, if two people have a problem, whether the system is right or those two are right, you can choose.