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Unit 8 Energy: the Indian Scenario

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Unit 8 Energy: the Indian Scenario UNIT 8 ENERGY: THE INDIAN SCENARIO Structure 8.1 Introduction Objectives 8.2 The Energy Fact File of India Domestic Energy Demand and Supply Non-hydro Renewable Energy Resources 8.3 Energy Policy of India Key Concerns for a Sustainable Energy Policy in India 8.4 Rural Energy Planning in India Issues and Challenges Meeting the Challenges 8.5 Summary 8.6 Terminal Questions 8.1 INTRODUCTION In Units 6 and 7 you have studied about various features of the energy policy and the process of energy planning. You have learnt that good energy planning is the key to effective implementation of the energy policy. Nations have to frame their own energy policy and create energy plans to achieve all round growth in various sectors of economy. In this unit, we look at the general principles enunciated so far in the Indian context and discuss the energy scenario in India including its energy policy and planning measures. India has a share of about 3% in the world energy consumption but harbours 17% of the planet's population. Currently, India is one of the fastest growing economies with a population growth rate of about 2%. A guaranteed availability of economical energy is a prerequisite for meeting the energy needs and for the development of India. With a large part of its one billion plus population without access to modern fuels and energy, India faces a formidable energy challenge. What options does Indiu have in the energy sector? How can it meet its energy challenge? These are some of the questions we look at in this unit. We begin by assessing the current energy demand and supply situation in India and then discuss the national energy policy. We also talk about rural energy planning in the Indian context. We hope that this unit will help you acquire a holistic view of the Indian energy situation, the energy potential of India and the challenges we face in realising it. Objectives After studying this unit, you should be able to: describe the current energy situation in India, including its energy needs, and the status of various resources; discuss the Indian 'energy policy; outline the challenges of rural energy planning in India; and analyse the issues facing India in the energy sector and the measures required to deal with them. 8.2 THE ENERGY FACT FILE OF INDIA You have learnt in Unit 2 that the per capita energy consumption and carbon emissions are relatively low in India. For example, in 1997, the per capita energy consumption in India was about 12.4 million BTU as compared to 35 1.9 million BTU per person in the United States and a global average of 64.8 million BTU per person. Likewise, in 1997, India emitted 0.25 metric tons of carbon dioxide per person, which is nearly one-quarter of the global average and 22 Energy: The Indian times less than the USA. However, with the growth of Indian economy accompanied Scenario by rapid urbanisation and increasing consumerism, the energy dekand in India is bound to increase. The per capita C02emissions are also expected to rise 3-fold between 1990 and 2020. Of course, the actual increase in emissions will also depend on the degree to which coal is used in India. How is our increasing demand going to be met in a manner that does not compromise the environment? What energy options are available to us? To answer these questions, we first look into various aspects of energy demand and supply in India. 8.2.1 Domestic Energy Demand and Supply The total energy available (in million tons) and the primary energy demand (in million tons) are shown in Table 8.1. Table 8.1: Energy availability and demand in India Energvaky(in million tons) I Commercial sources I I I 1 Non-Coking Coal L-Traditional sources Animal wastes 97.3 89.0 80.7 68.1 I Crop residue 1 52 52 52 5 2 Firewood 1 187 152.8 124.8 102 Primary energy demand (in million tons) Production 1 Imports 23.7 1 67.7 1 154.3 1 251.5 1 Production ~mports 1 0.0 1 40 1 92 220 1 11 11 Production 1 ~mports 1 0.0 0.0 68.3 1 170.8 1 * In billion cubic metres You can see from Table 8.1 thatbarring coal, there is a net shortfall of commercial energy which has to be made up through imports. The imports are projected to rise in the coming decade. You know that coal, oil, natural gas, hydro and nuclear power are Energy Policy and Planning amongst the primary sources of commercial energy in India. Their consumption is shown in Fig. 8.1 for the year 2000. 32.5 6.2 0.1 1.5 1.4 52.7 l~oal 8 Petroleum Natural gas Hydroelectric INuclear a Non-hydro renewables - Fig.8.l: The energy consumption of India by fuel for the year 2000 Data for energy consumption by various sectors of economy reveals that industry accounts for nearly half of total commercial energy consumption, followed by transport and domestic sectors. However, the share of industry in consumption has fallen by over 2% from a high of 50.4% in 1990-91 to 47.8% in 1997-98. While the share of domestic consumption has remained more or less the same, the share of transport sector has gone up by one percent. Agriculture in India accounts for only about 5% of commercial energy consumption. While industry accounts for a large (60%) share of coal consumption in the country, the transport sector consumes nearly 40% of petroleum products. Data on India's share in the world energy resources indicates that India is poorly * endowed in terms of commercial energy resources. Table 8.2: Proven fossil fuel reserves and estimates of R/P ratio* Fuel Unit Reserves (End 1997) R/P Ratio Data in Tables 8.2 to India World India World 8.8 are taken from the annual reports of the Coal billion tons 69.90 1032.0 212.0 219.0 Planning Commission Oil billion tons 0.6 140.90 15.60 40.90 of the Govt. of India. Natural gas trillion cubic 0.49 144.80 22.90 64.01 metres * The R/P ratio indicates the length of time (in years) the reserves would last if production were to continue at the current levels. The question is: How should we manage our energy resources to meet our developmental goals? For this we need to know the status of individual sources of energy in India. Coal India is comparatively rich in terms of coal. It has huge coal reserves, about 7% of the total world reserves. At the current level of production and consumption, these would last for well over 200 years. Coal constitutes the main source of commercial energy and accounts for over 60% primary consumption in the country. The annual average demand growth rate for coal projected for the period 1997-2012 is about 6.8% (see Table 8.3). The demand projections for coal made by the Planning Commission, Energy: The Indian Government of India are based on the end-use analysis of power, cement, iron and Scenario steel sectors assuming a GDP growth rate of about 7.4% in the period from 1997 to 2012. The domestic su'pply is expected to come from the existing mines as well as a few new projects needing huge investments. However, the exploitation of coal reserves is constrained by various factors like poor quality of coal, its high ash content, low calorific content as well as environmental concerns. ./i /' Table 8.3: Coal demand and supply forecasts for India (in million tons) 1997-98 2001-2002 2006-2007 2011-12 Demand 323 400 576 872 Domestic Supply 298 3 60 484 652 Deficit 25 40 92 220 I. - Coal imports have risen as they have become more economical in comparison with coal mining in India at some locations, especially along the coastline. By the end of the 1 lth plan period (200617-201 1/12), the demand for coal is expected to touch 872 million tons. However, in the long term, the shortfall in the supply of the domestic coal may lead to the use of cleaner alternative fuels like natural gas, which is a relatively new entrant in India's energy sector. Oil From Table 8.2, it is clear that proven reserves of hydrocarbons in India are small accounting for less than 0.6% of the global reserves. Nonetheless, for India, oil is a very vital energy resource. Table 8.4 shows the status of oil demand and supply in India. Table 8.4: Oil demand and supply in India (million barrels per day) Year Crude Crude , Petroleum Self reliance production imports products demand (%) 1997-1998 0.69 0.62 1.68. - 39 200 1-2002 0.74 1.57 2.10 33 2006-2007 0.80 2.20 2.89 26 2011-2012 0.90 3.3 1 4.06 2 1 Oil provides about 35% of the total commercial energy used and is the prime mover for the transport sector providing nearly 99% of its energy needs. Almost 45% of the total oil consumed by the economy goes to the transport sector. Oil is very important for other sectors too. Oil derivatives are critical ingredients of nearly 5000 consumer products ranging from medicines, fabrics, fertilisers, cosmetics and plastics to petroleum jelly. The demand for petroleum products is estimated to grow at a Compound Annual Rate of Growth (CARG) of 6% in the period 1997-2012.
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