Role of renewables in energy mix in perspective of indian energy independence scenario

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© I A E M E
ROLE OF RENEWABLES IN ENERGY MIX IN
PERSPECTIVE OF INDIAN ENERGY INDEPENDENCE
SCENARIO
M.R. KOLHE B.E., M.B.A. Dr. P.G. KHOT,
R.T.M.NAGPUR UNIVERSITY, Prof. DEPT OF STATISTICS,
NAGPUR INDIA R.T.M.NAGPUR UNIVERSITY,
NAGPUR INDIA
1. ABSTRACT
Any country’s growth is dependent on its ability to provide affordable and sustainable supply
of energy. India is set to witness one of the highest growths in energy demand, largely based on
buoyant economy and rising population. There is a strong linkage between economic growth and
energy demand. Coal is a pre-dominant source of energy in India and constitutes the largest share in
India’s energy production and consumption. Despite the recent focus on promoting other energy
sources (in particular renewables), it is clear that the current coal-centric energy structure will
continue for at least next few decades owing to technical and cost-related factors. The coal sector in
India, in the past few years, has been subject to various controversies and issues, which raise
question on the overall governance of the energy sector. These governance issues, if unaddressed,
can hamper the sustainable growth of the sector and in turn the overall growth and development of
the economy.
Presently we are using various sources of energy mainly, fossil fuels, hydro, nuclear etc. but
three centuries ago, we used nothing but renewables, with a fully sustainable energy system
consisting of wind power (windmills), hydro power (water mills) and bio-fuels (wood stoves and
animal power) and some are still in use. But these renewables have their limitations and could not
give its major share in growing economics in increasing energy demands. The fossil fuels
particularly coal has given boost particularly to power generation which has contributed major share
in energy mix in Indian scenario. On contrary Coal industry has an environmental adverse impact
which includes the issues such as land use, waste management, water and air pollution etc., caused
by the coal mining, processing and the use of its products. Now we are trying to return to the past i.e.
renewables, with the addition of a few new sources such as solar and geothermal. In the interim our
population has increased many fold and economic activities by several orders in magnitude.

International Journal of Management (IJM), ISSN 0976 – 6502(Print), ISSN 0976 - 6510(Online),
2

But the role of renewables to replace the conventional energy sources e.g. fossil fuels was not
seriously and systematically thought of. The first discussion of renewables in economics was in the
post-73 oil shock era, when we rediscovered Hotelling’s work on resource depletion and refined it in
various ways. The need for renewables, in the sense of energy from non-exhaustible sources having
no environmental footprint, was also recognized. Then the phrase “backstop technology,” was used
i.e. a technology that would eventually replace exhaustible resources with energy sources such as
nuclear fusion, or solar or wind energy, continuing forever. The need to act on climate change,
coupled with the realization that there are no silver bullets like nuclear fusion, has forced policy
makers to grapple with the merits of alternative energy and consider the consequences of moving to
carbon-free energy within a few decades. Of course, carbon-free is not the same as renewable:
nuclear is carbon-free, but probably not what most people have in mind as renewable, and coal with
carbon capture and storage (CCS) is also carbon-free at the output level, and again not as renewable.
It does seem uncontroversial that at least one of nuclear, coal with CCS and renewables has to be
adopted on a very large scale for a sustainable future, and we may conclude that either nuclear or
coal with CCS must be in the mix as well as many types of renewables, at least for the foreseeable
future.
In this paper, both types of energy i.e. renewable and nonrenewable are studied with their
advantages disadvantages and to have proper energy mix of these sources for environment
friendly sustainable growth. The emphasis is given to evaluate the role of renewable resources in
energy mix in the energy scenario of India.
2. INTRODUCTION
In layman’s language, energy means amount of force or power when applied can move one
object from one position to another or in other terms Energy defines the capacity of a system to do
work. It exists in everybody whether they are human beings or animals or non living things for e.g.:
Jet, Light, Machines etc. It exists in many forms like kinetic, potential, light, sound, gravitational,
elastic, electromagnetic or nuclear. As per to the law of conservation of energy, the total energy
remains the same, only it changes its form i.e. it can be converted from one form into another form.
The many different natural and renewable energy technologies are by no means breakthrough. Many
of the renewable energy technologies have been around for years, and as time go by, are increasing
in efficiency. Here, energy is broadly classified into two main groups: Renewable and Non-renewable.
Non-Renewable Energy is taken from the sources that are available on the earth in limited
quantity and will vanish shortly may be in fifty-sixty years from now. Non-renewable sources are not
environmental friendly and can have serious affect on our health. They are called non-renewable
because they cannot be re-generated within a short span of time. Non-renewable sources exist in the
form of fossil fuels i.e. coal, natural gas and oil.
Renewable energy is generated from natural sources e.g. sun, wind, rain, tides and can be
generated again and again as and when required. They are available in plenty and by far most the
cleanest sources of energy available on this planet. For e.g.: energy that we receive from the sun can
be used to generate electricity. Similarly, energy from wind, geothermal, biomass from plants, tides
can be used to fulfill our daily energy demands.
Renewables come in many different flavors: they may not be limited to only hydro, solar
(photovoltaic and thermal), wind, geothermal, tidal, biofuels, and waste-to-energy processes.
However the focus is normally on those that can be used to generate electricity, or to replace it. Most
of them have certain economic characteristics in common – large fixed costs and low or no variable
costs, and consequently average costs that are very dependent on output levels. Solar, wind, hydro,
geothermal, tidal and waste-to-energy all require substantial up-front capital expenditures before any

International Journal of Management (IJM), ISSN 0976
Volume 5, Issue 11, November (2014), pp.
energy is generated, but have no fuel costs (all except waste
usually free). Their only ongoing costs are mai
case of waste-to-energy. In contrast, fossil fuel power stations have significant fuel costs. But the
renewables like hydro, solar, wind have a characteristic that there is no surety for its continual
throughout the year. Nuclear is close to
ongoing fuel costs. The renewable energy sources are generally capital intensive and have no
running cost. The renewable-based power station
next forty years. A coal-fired power station meets the capital costs but leaving our successors over its
forty year life to meet the large fuel costs and the external costs associated with its pollution. When
we build a renewable power station we are
electricity from it. This has implications for what kind of financing might be appropriate
particular it makes long-term debt financing seem fair.
3. GLOBAL ENERGY SCENARIO: RESERVE PRODUCTION

Prior to the use of coal as a prime fuel for power generation,
all energy used was renewable. Almost without a doubt the oldest known use of renewable energy, in
the form of traditional biomass to fuel fires, dates from 790,000 yea
oldest usage of renewable energy is harnessing the wind in order to drive ships over water. This
practice can be traced back some 7000 years, to ships on the Nile. Moving into the time of recorded
history, the primary sources of traditional renewable energy were human
power, wind, in grain crushing windmills
running out of coal prompted experiments with using solar energy. The importance of solar energy
was recognized in a 1911 when natural fuels
the only means of existence of the human race. In the 1970s environmentalists promoted the
development of renewable energy both as a replacem
for an escape from dependence on oil, and the first electricity generating
Coal constitutes approximately 60% of the fossil fuel reserves in the world, with the remaining 40%
being oil and gas.
-
Average electric power (TWh/year)
Average electric power (GW)
Proportion
(Data source- IEA/OECD)
– 6502(Print), ISSN 0976
01-20 © IAEME
3
waste-to-energy need no fuel, and waste is
maintenance and operation, plus some energy inp
renewables in its cost structure: large capital costs and small
today can provide free electricity to its users for
effectively pre-paying for the next forty years of
in the mid 19th century, nearly
years ago. Probably the second
labor
windmills, and firewood, a traditional biomass. By 1873, concerns of
having been exhausted; the solar power will remain as
replacement for the eventual depletion of oil
wind turbines
ximately Source of Electricity (World total year 2008)
Coal Oil Natural Gas Nuclear Renewable
8,263 1,111 4,301 2,731 3,288
942.6 126.7 490.7 311.6 375.1
41% 5% 21% 13% 16%
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ntenance input in the
the
– in
rs labor, animal power, water
, oil, as well as
appeared.
Other Total
568 20,261
64.8 2311.4
3% 100%

01-20 © IAEME
Indian scenario: Oil, Coal Natural Gas

The Current estimates show
– 6502(Print), ISSN 0976
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India’s total oil reserves of 125 Million metric tonnes of proven
oil reserves as April 2010 or 5.7 billion barrels,
level of consumption i.e. 2.63 Mbbl/d (418,000
more than a quarter of India’s twenty
These include offshore basins covering about 3,80,000 square
covering 13,40,000 square kilometers
thirty billion tonnes of reserves, five times the current figure, thereby extending the projected
depletion date by more than fifty years
confirmed natural gas reserves as of April 2010.
Regarding coal, proven reserves in the country are in excess of eighty
total reserve position swells to mo
inferred reserves are added which is enough for 60 years
coal based on a combination of direct measurements and reasonable geologic assumptions made wit
high confidence. Inferred reserve
coal beds, both downwards into the earth and across the landscape from points of direct
measurement.
is enough to last a dozens of
years, at the present
m3/d). Recent international studies indicate that no
twenty-six secondary basins have seen serious exploration activity.
Mother earth has bestowed us with ample resources requir
and on shore basins
12 cu ft) of
if indicated and
with
ed mean that all these natural resources are to be consumed by current generation only and
next generation be deprived of. The fossil fuels for which earth has taken millions of years to form,
will it be justified that they be consumed
conservation?
Mission Vision
The India’s giants companies
letting the
consideration of
natural gas and coal, are public sector companies having major share in production of oil, natural gas
and coal have set their mission to produce efficiently and market their products, with due respect to
safety, health, environment and conservation.
4
kilometers
kilometers. It has been estimated that these untapped basins may contain
years. India has 1,437 billion cubic metres (50.7×10
roven eighty-one billion tonnes, while the
more than two hundred and eleven billion tones
years. Indicated reserve means the amount of
shows amount of resource based on the assumed continuity of
required for our life. But it does not
just in few hundred years, without having
ONGC, GAIL and CIL which are major producer of oil

5

ONGC, is the prime Oil Natural Gas Producing Company, is global leader in integrated
energy business through sustainable growth, knowledge excellence and exemplary governance
practices, and has aimed to abide commitment to safety, health and environment to enrich quality of
community life.
GAIL (Gas Authority India Limited)’s Mission is to accelerate and optimize the effective and
economic use of Natural Gas and its fractions for the benefit of the national economy. And its Vision
is Be the leading company in Natural Gas and beyond, with Global Focus, Committed to Customer
Care, Value Creation for all Stakeholders and Environmental Responsibility.
CIL (Coal India Limited) a coal producing giant company in India has set its vision as To
emerge as a global player in the primary energy sector committed to provide energy security to the
country by attaining environmentally socially sustainable growth through best practices from mine
to market and the mission as To produce and market the planned quantity of coal and coal products
efficiently and economically in an eco-friendly manner with due regard to safety, conservation and
quality.
Presently crude oil, coal and gas are the main resources for world energy supply. The size of
fossil fuel reserves and the dilemma that when non-renewable energy will be diminished, is a
fundamental and doubtful question that needs to be answered. Here a new formula for calculating
when fossil fuel reserves are likely to be depleted is presented along with an econometrics model to
demonstrate the relationship between fossil fuel reserves and some main variables (Shahriar Shafiee
et.al. 2009). The new formula is modified from the Klass model and thus assumes a continuous
compound rate and computes fossil fuel reserve depletion times for oil, coal and gas of
approximately 35, 107 and 37 years, respectively. This means that coal reserves are available up to
2112, and will be the only fossil fuel remaining after 2050.
Above statistics indicates that there is comfortable reserves position which reflected in the
long-term price trends of fossil fuels and has declined in real terms since the 1970s. In fact, fossil
fuel prices in real terms are lower now than they were in the 1940s.
In view of above it can be concluded that Fossil fuels are not disappearing in a hurry. Ergo,
what’s the hurry in imposing renewable sources of energy on consumers when the markets are not
ready to accept them?
Although the minable fossil fuels are enough to cater the demand till beginning of 22nd
century, we cannot ignore the effort to find out the alternative sources of energy. This is the time to
make all our efforts to find out various affordable alternatives to fossil fuels. Moreover, the longer
use of fossil fuels at growing demand will endanger the nature and life on earth.
Therefore the sincere efforts are needed to work out the strategy to evaluate all other energy
sources and put them in use at global level so that the nature will be saved for our future generations.
Natural Gas: The government has been the sole authority for fixing the price of natural gas in the
country. It has also been taking decisions on the allocation of gas to various competing consumers.
Natural gas has always been a supply-constraint market in India. The most prolific gas producing
fields include Bombay High which is operated by ONGC and contributed ~34% of the total gas
production in 2011-12, KG-D6 offshore which is operated by Reliance Industries Ltd and
contributed ~33% of the total gas production in 2011-12. The total offshore gas production accounts
for 88% of the total production in India. The share of the private sector and JVs in the country’s total
gas production is expected to increase, owing to recent gas discoveries expected to be monetized by
the companies.
This study estimates alternative trajectories of energy requirements and examines the likely
fuel mix for the country under various resource and technological constraints over a 30-year time
frame Economic and technological scenarios have been developed within the integrated modeling
framework to assess the best energy mix during the modeling time frame. Based on the scenario

01-20 © IAEME
assessment, the report provides directions to
sector including policy-makers, technologists, and investor
to play a key role in meeting
availability of coal is expected to p
plans and technology.
eholders Indian energy
. would continue
the country’s energy requirements. How
- 6510(Online),
ntry’s However, the indigenous
pected plateau in the next couple of decades with the current exploitation
4. ISSUES WITH FOSSIL FUELS

– 6502(Print), ISSN 0976
various stakeholders associated with the In
investor. It also indicates that coal
cades India’s dependence on fossil fuel is widely regarded as unsustainable.
This unsustainability is
not just environmental in character, but is emerging as a macroeconomic one
challenges for India on multiple fronts
developing new renewables and strengthening the macroeconomic fundamentals by making India a
more attractive destination for FDI.
as well, leading to
India’s current energy use is unsustainable. This consists of fossil fuels, hydro and nuclear
resources on the one hand, and combustible biomass and wastes
non-traded resources having a share of almost one quarter in the total pr
imary renewable resources currently have a negligible share (0.36%) in the total commercial (i.e. traded)
energy balance.
Composition of Primary Commercial Energy of India in % share (2009)
The high dependence of India’s energy syste
m because of the high share of carbon footprint in the total ecological footprint and the various other
adverse environmental effects, but also because of the economic (or ‘macroeconomic’)
unsustainability of such dependence due to heavy financial requirement for imports arising from the
growing scarcity of the fossil fuel resources. The
such an energy supply are outlined
Coal
Among the fossil fuels, coal, being a relatively cheap and perceived to be an ‘abundant’
energy resource as compared to hydrocarbons in India, has remained the focus of attention for
energy planners ever since the oil shock of the early 1970s to meet the e
demand in the country. The total estimated reserve of coal in India as of 31 March 2010 was around
277 billion tonnes, according to the Energy Statistics of India in 2012. However, the minability and
extractability of Indian coal are significantly affected by the geological, technical and other surface
constraints such as township, riverbed, high environmental fragility due to the location of deposits
underneath deep pristine forests and so on resulting in high economic cost for at lea
the resource which cannot be as a result
measurement due to methodological reasons have further compounded the problem of estimation of
reserves for energy planning. The high ash q
the apparent benefit of the low-cost of coal from the geo
All these factors have resulted in the growing import of both coking and non
due to demand exceeding domestic supply and also of washing both coking and also non
6
T
– discovering new sources of hydrocarbon deposits,
on the other, the latter being largely
primary energy supply. New
system on fossil fuel is unsustainable not only
ependence issues underlying the financial unsustainability of
as under.
ever-increasing energy
least some part of
categorized as economically viable reserves. Some errors in
quality problem of Indian coal also tends to offset part of
geo-technically friendly coal fields and basins.
uality non-coking coal over time
non-coking

coal. The share of import of coal in total apparent consumption has in fact grown from 2.2% in 1989-
1990 to 11.1% in 2010-2011. The unit prices of imports of coal by India also rose during the period
1989-1990 to 2010-2011 in both nominal dollars and rupees, particularly since 2000, at the
respective annual rates of 10.8% and 11.4%. The rise in the import price of coal in its turn eroded the
relative cost benefit of imports of such coal.
7

In the light of various questions raised regarding pollution, global warming, depletion of coal
reserve due to extensive use of coal, CCS IGCC are the methods which may find solution to these
issues.
Carbon Capture and Storage (CCS): CCS is method to mitigate global warming and the
primary focus of this study. As the name suggests, in this method, CO2 emitted from thermal power
plants and CO2 intensive industries is captured and stored in various reservoirs to lessen their
polluting impact on the atmosphere. CCS is therefore hailed as the technology of the future. As our
dependence on fossil fuels is not expected to decline radically in the near future, CCS can provide an
excellent transition from conventional to non-conventional methods of generating power, such as
solar power, wind power, geothermal energy, etc. CCS is referred to as ‘fictitious reduction’, since
there is no decrease in the emission of CO2 from the Earth, but the polluting impact is lessened.
Some suggest that the “carbon problem” could be solved through the increased use of
renewable energy sources. Even if renewables become cost-competitive, however, which is an open
question, the time it will take them to penetrate the market implies significant continued use of fossil
fuels in the interim. Others see a built-in solution to the problem of fossil-fuel combustion: there is a
limited supply of fossil fuels, and at some point, their use will become too costly, forcing a switch to
alternative energy sources. Thus, the policy should be to wait until the fossil fuel supply is depleted
and allow rising fossil fuel prices to induce the development of renewable energy sources. But this
argument assumes that fossil fuels will become scarce before the gradual atmospheric buildup of
GHGs becomes too costly in terms of its effect on terrestrial ecosystems and human societies Energy
efficiency improvements and switching from fossil fuels toward less carbon-intensive energy sources
were once seen as the only realistic means of reducing carbon dioxide (CO2) emissions. In recent
years, however, analysts and policymakers have begun to recognize the potential for a third option—
the development of “end-of-pipe” technologies that would allow for the continued utilization of
fossil fuel energy sources while significantly reducing carbon emissions. These technologies have
collectively come to be known as carbon capture and storage (CCS) technologies. Using these
technologies, CO2 would be “captured” from large, stationary sources (e.g., power plant flue gases),
preventing its release to the atmosphere.
Integrated gasification combined cycle (IGCC): IGCC is an integrated gasification combined cycle
(IGCC) is a technology that uses a gasifier to turn coal and other carbon based fuels into gas—
synthesis gas (syngas). It then removes impurities from the syngas before it is combusted. Some of
these pollutants, such as sulfur, can be turned into re-usable byproducts. The plant is called
integrated because (1) the syngas produced in the gasification section is used as fuel for the gas
turbine in the combined cycle, and (2) steam produced by the syngas coolers in the gasification
section is used by the steam turbine in the combined cycle. In this example the syngas produced is
used as fuel in a gas turbine which produces electrical power. In a normal combined cycle, so-called
waste heat from the gas turbine exhaust is used in a Heat Recovery Steam Generator (HRSG) to
make steam for the steam turbine cycle. An IGCC plant improves the overall process efficiency by
adding the higher-temperature steam produced by the gasification process to the steam turbine cycle.
This steam is then used in steam turbines to produce additional electrical power. This way the
available coal may be preserved conserved.

8
Oil and Natural gas

India is highly dependent on the import of crude oil to meet its energy demand and oil import
has been steadily rising over the years. Although India has set up some refinery capacity under a
private initiative which is used only to produce for export of petroleum products, the net imports of
total oil (that is, aggregate of all imports of crude and petroleum products less all exports of
petroleum products) have increased from around 25 million tonnes during 1989-1990 to around 120
million tonnes in 2010-2011 – a growth rate of over 7% each year over the past two decades. While
the average price of India’s net import of oil has gone up in both nominal rupees by around 14%
each year and nominal dollars by around 6% each year, the share of import in the total apparent
consumption of oil (that is, crude oil production plus net petroleum import) has grown from 43% in
1989-1990 to a high of 76% in 2010-2011.
The natural gas market, on the other hand, is only an emerging market in India. The
International Energy Agency (IEA) estimates the Indian market of natural gas to be one of the fastest
growing in the world over the next 20 years and projects the growth to be around 5.4% per year over
2007-2030 (IEA, 2009). It is being preferred mainly due to its inherent environmentally benign
nature, greater efficiency and cost-effectiveness as a fuel. The production of natural gas has picked
up very recently in 2009 with the start of the Krishna-Godavari KG-D6 hydrocarbons bearing field
after remaining stagnant for almost a decade. The enactment of the New Exploration Licensing
Policy (NELP) by the government has played a key role in ensuring greater participation of private
and foreign companies in natural gas discovery and extraction. India has already started importing
natural gas in spite of such growth in production the share of import reaching 19% of apparent
consumption in 2010-2011. The unit price of natural gas in nominal dollar has also been growing at
an annual average rate of 3.85% per year since 2004-2005.
The Indian economy presently is believed to have established itself on a healthy growth path
and this would increase going forward the energy consumption in the country. This increase in
consumption is expected to be supplemented by an alteration in the primary energy mix of India on
account of the substitution of oil by natural gas. The share of natural gas in the energy mix of India is
expected to increase to 20% in 2025 as compared to 11% in 2010 However, given that all the plans
for expansion in natural gas supply in the country with the help of additional RLNG terminals,
nationwide transmission pipeline network and transnational pipelines are expected to materialize by
2025, it is envisaged that the share of natural gas in the primary energy mix would reach 20% till
2030 if not more. In recent years the demand for natural gas in India has increased significantly due
to its higher availability, development of transmission and distribution infrastructure, the savings
from the usage of natural gas in place of alternate fuels, the environment friendly characteristics of
natural gas as a fuel and the overall favorable economics of supplying gas at reasonable prices to end
consumers. Power and Fertilizer sector remain the two biggest contributors to natural gas demand in
India and continue to account for more than 55% of gas consumption. India can be divided into six
major regional natural gas markets namely Northern, Western, Central, Southern, Eastern and North-
Eastern market, out of which the Western and Northern markets currently have the highest
consumption due to better pipeline connectivity. However, with the increasing coverage and reach of
natural gas infrastructure in India, this regional imbalance is expected to get corrected. In future, the
natural gas demand is all set to grow significantly at a CAGR of 6.8% from 242.6 MMSCMD in
2012-13 to 746 MMSCMD in 2029-30. This demand represents the Realistic Demand for natural gas
in India. Gas based power generation is expected to contribute the highest, in the range of 36% to
47%, to this demand in the projected period (2012-13 to 2029-30). The share of fertilizer sector in
the overall gas consumption in the country is expected to go down from 25% in FY 2013 to 15% in
FY 2030 owing to higher growth in other sectors. The contribution to the overall demand from the
CGD sector is set to increase from 6% to 11% during the projected period. The demand from CGD
sector includes demand for combined heating and cooling power plants (“CCHP”) from Industries.

9
5. AGGREGATE FOSSIL FUEL ENERGY

As now India is importing all kinds of fossil fuels, the percentage share of total import in the
total apparent consumption of such fuels (in units of oil equivalent tonne) had been increasing
throughout the past two decades and touched 35% in 2010-2011. Meanwhile, the unit price of total
fossil fuel (in oil equivalent units) has increased in nominal rupees and dollar terms at the rates of
10% per year and 6% per year respectively. As a result of the price rise and the growing imports of
all the fossil fuels as indicated above, India’s total bill of net import of energy has grown at an
alarming rate of close to 20% per year, leading to an increase of almost 55 times over the past two
decades. As a consequence, the share of total energy import bill as a percentage of India’s total
export earnings has also been growing over time, and has now reached almost 38% in 2010-2011
which is a source of concern for macro-economic sustainability of such pattern of growth of energy
use in India. In view of the sharp decline in the rate of growth of IT related service export earnings to
10% per year, the slowing down of inflow of foreign direct investment (FDI) into India and the
footloose erratic character of inflow of foreign portfolio investment, the current pattern of fossil fuel
use is likely to create macro-economic stress on the front of the balance of payments and the stability
of India’s currency value. Thus, replacement of fossil fuel by renewables is not only important for
the environmental sustainability or greenness of our development process, but also in the interest of
the macroeconomic sustainability of our growth process.
6. ENERGY CRISES: PRESENT AND FUTURE
The energy crisis is the concern that the world’s demands on the limited natural resources
that are used to power industrial society are diminishing as the demand rises. These natural resources
are in limited supply. While they do occur naturally, it can take hundreds of thousands of years to
replenish the stores. Governments and concerned individuals are working to make the use of
renewable resources a priority, and to lessen the irresponsible use of natural supplies through
increased conservation.
The energy crisis is a broad and complex topic. Most people don’t feel connected to its reality
unless the price of gas at the pump goes up or there are lines at the gas station. The energy crisis is
something that is ongoing and getting worse, despite many efforts. The reason for this is that there is
not a broad understanding of the complex causes and solutions for the energy crisis that will allow
for an effort to happen that will resolve it.
According to the Wikipedia, “An energy crisis is any great bottleneck (or price rise) in the
supply of energy resources to an economy. In popular literature though, it often refers to one of the
energy sources used at a certain time and place, particularly those that supply national electricity
grids or serve as fuel for vehicles. “
How real is the Energy Crisis? Many times, there is a renewed debate on how “real” the energy
crisis is in the world. One side will always say it is based on faulty science and politics; the other will
say that the other side is basing their findings on junk science and political interests. The best way to
sum up the reality of the energy crisis is that you cannot have growing demands on limited resources
without eventually running out of the resource. That is just common sense. What is really at play in
the discussion about how real the energy crisis is concerns the perception of responsibility for the
future. There is no real energy crisis if you are not concerned about life after your time on Earth is
gone. There is a very real energy crisis if you care about the future that the next generations will
inherit.

Causes of the Energy Crisis- It would be easy to point a finger at one practice or industry and lay
the blame for the entire energy crisis at their door, but that would be a very naive and unrealistic
interpretation of the cause of the crisis.
1. Overconsumption: The energy crisis is a result of many different strains on our natural resources,
not just one. There is a strain on fossil fuels such as oil, gas and coal due to overconsumption –
which then in turn can put a strain on our water and oxygen resources by causing pollution.
2. Overpopulation: Another cause of the crisis has been the steady increase in the world’s
population and its demands for fuel and products. No matter what type of food or products you
choose to use – from fair trade and organic to those made from petroleum products in a sweatshop –
not one of them is made or transported without a significant drain on our energy resources.
3. Poor Infrastructure: Aging infrastructure of power generating equipment is yet another reason
for energy shortage. Most of the energy producing firms keep on using outdated equipment that
restricts the production of energy. It is the responsibility of utilities to keep on upgrading the
infrastructure and set a high standard of performance.
4. Unexplored Renewable Energy Options: Renewable energy still remains unused is most of the
countries. Most of the energy comes from non-renewable sources like coal. It still remains the top
choice to produce energy. Unless we give renewable energy a serious thought, the problem of energy
crisis cannot be solved. Renewable energy sources can reduce our dependance on fossil fuels and
also helps to reduce greenhouse gas emissions.
5. Delay in Commissioning of Power Plants: In few countries, there is a significant delay in
commissioning of new power plants that can fill the gap between demand and supply of energy. The
result is that old plants come under huge stress to meet the daily demand for power. When supply
doesn’t matches demand, it results in load shedding and breakdown.
6. Wastage of Energy: In most parts of the world, people do not realize the importance of
conserving energy. It is only limited to books, internet, newspaper ads, lip service and seminars.
Unless we give it a serious thought, things are not going to change anytime sooner. Simple things
like switching off fans and lights when not in use, using maximum daylight, walking instead of
driving for short distances, using CFL instead of traditional bulbs, proper insulation for leakage of
energy can go a long way in saving energy. Read here about 151 ways of saving energy.
7. Poor Distribution System: Frequent tripping and breakdown are result of a poor distribution
system.
8. Major Accidents and Natural Calamities: Major accidents like pipeline burst and natural
calamities like eruption of volcanoes, floods, earthquakes can also cause interruptions to energy
supplies. The huge gap between supply and demand of energy can raise the price of essential items
which can give rise to inflation.
9. Wars and attacks: Wars can hamper supply of energy specially it happens in Middle east
countries iin 1990 Gilf war and oil price reached to peak causing global shortage.
10. Miscellaneous factors: Tax hikes, strikes, military coup, political events, extreme temperature
can cause sudden increase in demand of energy and can choke supply.
10

7. RENEWABLE ENERGY SOURCES AND THEIR LIMITATIONS
11

As the major part of India’s coal import is for the power and steel sector, coal has been
substituted by two carbon free non-fossil fuel energy resources from among the conventional ones –
namely nuclear and Hydro in large storage – for power generation. The prospect of nuclear route of
energy development depends on India’s success at the stage of breeder reactor and that in developing
thorium-uranium cycle so that it can use its huge stock of thorium reserve. It is now too early to
assess the situation, but India needs to engage in trade in uranium and light water reactor market so
that it is in a position to successfully experiment with uranium-thorium reactor. So far as large
hydro-electric projects are concerned this option is fraught with too many socio-political and
political economic problems arising from the environmental effects due to too much disturbance in
the local and regional ecosystems of the river basin and river valley as well as human ecological
conditions due to the destabilization of human settlements. Besides, the high capital cost of storage
of water as power energy resource and high gestation lag of projects when added to the
environmental costs would often tend to offset the benefit of zero fuel cost of hydro-electric power.
It is obvious that India will have to depend on new renewable energy resources to meet the
challenge of the growing eco-scarcity of fossil fuel resources and to combine macroeconomic
sustainability with the environmental one. However, as power, steel and transport are responsible for
most of the imports of coal and oil which have limited substitutability by other fuels in these sectors,
the development and deployment of the technologies of new renewable resources of wind, solar,
biomass and wastes for conversion into power and of bio-liquids to substitute petroleum as blending
fuel into diesel and petrol have become vital for sustainable or green energy development.
This issue of energy security and macroeconomic sustainability of growth also further
requires greater flow of hydrocarbons from domestic sources and intensification of hydrocarbon
discovery activities. For attracting finance and modern technology for such purpose in this area, it is
important to encourage foreign investors to take greater interest in such investment – which depends
on the terms of production-sharing and profit-sharing contracts and prices of the products in this
sector. While the price of oil, which is quite liquid in trade, is globally determined, the market for
gas is mostly localized and region specific. The government is expected to announce its gas pricing
and gas utilization policy and fix it for a period of time. This is particularly important to create a
competitive environment in such investments in view of the oligopolistic nature of this global
industry. The Indian government is at the moment engaged in such task of restructuring the
production-sharing contract and formulating its gas pricing policy.
Finally, India will have to live with net dependence on the import of some fossil fuel energy,
however reduced, for supporting the growth of its economy. The current-account deficit in balance
of payments as caused by energy import would warrant the creation of a business environment in
India which would be conducive for attracting FDI and thereby ensure no deficit in the overall
balance of payments. There should also be policies regarding the direction of inflow of foreign
investments into the area of renewables and biofuels for the transfer of the required technology and
mobilisation of the required financial resources for the purpose.
8. ENERGY SECURITY
The heating up of earth’s atmosphere due to trapping of long wavelength infrared rays by the
carbon dioxide layer in the atmosphere is called green house effect. The key greenhouse gases
driving global warming are Carbon-dioxide, CFC, methane, Ozone, Nitrous oxide etc. The basic aim
of energy security for a nation is to reduce its dependency on the imported energy sources for its
economic growth BEE facilitates Energy efficiency programs in India by preparing standards and
labels of appliances, developing a list of designated consumers, specifying certification and

accreditation procedures, preparing building codes, maintaining central EC fund and undertaking
promotional activities in coordination with centre and state level agencies.
Some of the strategies that can be used to meet future challenges to Nation’s energy security are:
Some of the long-term energy strategies available for the better energy secured nation are as under:
Efficient generation of energy resources
• Efficient production of coal, oil and natural gas
• Reduction of natural gas flaring
Improving energy infrastructure
• Building new refineries
• Creation of urban gas transmission and distribution network
Maximizing efficiency of rail transport of coal production.
• Building a new coal gas fired power stations.
• Maximizing efficiency of rail transport of coal production.
• Building new coal and gas fired power stations.
Enhancing energy efficiency
• Improving energy efficiency in accordance with national, socio-economic, and environmental
12
• Building stockpiles of fuels
• Diversification of energy supply sources
• Increased capacity of fuel switching
• Demand restraint
• Development of renewable energy sources
• Energy efficiency
• Sustainable development

priorities
• Promoting of energy efficiency and emission standards
• Labeling programmes for products and adoption of energy efficient technologies in large
industries
Deregulation and privatization of energy sector
• Reducing cross subsidies on oil products and electricity tariffs
• Decontrolling coal prices and making natural gas prices competitive
• Privatization of oil, coal and power sectors for improved efficiency.
Investment legislation to attract foreign investments.
• Streamlining approval process for attracting private sector participation in power generation,
transmission and distribution as they do not reflect economic costs at all in many cases.
9. ENERGY MIX
Over the last two decades (1990-2011), India’s primary energy mix has not changed much.
The country continues to depend, for most of its energy needs, on coal (50%) and oil (~30%).

01-20 © IAEME
However, natural gas is emerging as one of the fastest
rate of 8%. Currently, it accounts for 9
9% of the total primary energy consumption.
Present energy mix of consumption is shown

– 6502(Print), ISSN 0976
fastest-growing fuels, registering an annual growth
in diagram table below:
53%
30%
2%
9%
5%
1%
100%
On the other hand, other renewable segments solar, geothermal, wind energy, etc.) and
nuclear energy consumption have also registered an impressive annual growth as compared to the
last decade.
India’s twelfth five year plans estimates that an additional capacity of 75,785 MW is required
over the plan period, giving a total capacity of approximately 276,000 MW. To decrease the gap
between peak demand and peak deficit and to permit the retirement
plants, the plan target has been fixed at 88,537 MW. To meet this target, the private sector share of
this additional capacity will be increased to 53 per cent, up from 19 per cent in the eleventh plan.
this added capacity, the Plan estimates that thermal energy derived from coal and lignite will account
for 79 per cent, up from 76 per cent in the previous plan. Hydro
10,897 MW (12 per cent of the estimated additional capacity), and nuclear capac
(approximately 6 per cent). Energy imports from Bhutan are expected to total 1,200 MW (1.36 per
cent). It is in the renewable sector, however, that major increases are planned; the planned total
addition to capacity of 30,000 MW comprises 15,000 MW wind energy, 10,000 MW solar energy,
2,100 small-hydro power and the balance to be derived
India’s projected energy mi
role. The solar and wind has to contribute their major part in the energy mix 2030. The energy from
coal will become increasingly import dependent despite increased production of both renewa
nuclear energy. Estimated Energy Mix 2030 for India and components of renewable source energy
generation is graphically indicated as under:
13
of older, inefficient energy
Hydro-power is expected to generate
from biomass.
’s mix in 2030 is as under wherein the renewable has to play prominent
. Coal
Oil
Renewable*
Gas
Hydro
Nuclear
Total
Source
Coal
Renewable*
Gas
Hydro
Nuclear
Total
- 6510(Online),
% Of
capacity 5,300 MW
x renewable and
2030
62%
14%
6%
10%
8%
100%

Renewable
Sources
Silent points regarding energy mix for 2030 are appended below:
14

2030
Solar 52%
Wind 39%
Biomass 7%
Others 2%
1. India’s energy production expected to rise by 95%.
2. Coal remains the dominant fuel produced in India growing by 116% and accounting for 62%
of total energy produced in 2030.
3. A production decline in oil is offset by gains in hydro, nuclear, and renewable.
4. Coal will remain the leading fuel in power generation at 62% in 2030.
5. Despite coal’s loss of market share in power generation, the fuel meets 63% of the growth
while renewables contribute 14%, hydro 10%, nuclear 8%, and gas 6%.
6. Net energy imports increase by 135% as the country imports 42% of total energy demand in
2030, up from 37% today.
7. Energy consumption grows by 110%. India sees strong growth in renewable, hydro, and
nuclear as well.
8. Energy consumed in power generation rises by 104%; energy demand in transport rises by
180%.
9. Industry remains the largest final energy consumer of all sectors increasing by 104%, but its
market share drops to 57% as transport rises.
10. Oil maintains its dominance in the transport sector as its share actually increases from 94% in
2011 to 95% in 2030.
11. Fossil fuels account for 88% of Indian energy consumption in 2030, down marginally from
92% in 2011.
12. Renewables share of consumption rises from 2% to 14% in 2030.
13. Oil imports will rise by 152% as the country’s production meets less than 10% of demand by
2030.
14. India’s CO2 emissions from energy consumption double, as the country’s energy intensity
declines by 28% by 2030.
10. ECONOMY: SCOPE OF RENEWABLE IN INDIAN ENERGY SCENARIO:
India has recorded impressive rates of economic growth in recent years, which provide the
basis for more ambitious achievements in the future. However, a healthy rate of economic growth
equaling or exceeding the current rate of 8% per annum would require major provision of
infrastructure and enhanced supply of input such as energy. High economic growth would create
much larger demand for energy and this would present the country with a variety of choices in terms
of supply possibilities. Technology would be an important element of future energy strategy for the
country, because related to a range of future demand and supply scenario would be issues of
technological choices both on the supply and demand sides, which need to be understood at this
stage, if they are to become an important part of India’s energy solution in the future. The Indian
government aims to achieve an economic growth rate of over 8% in the next two decades in order to

be able to meet its development objectives. However, rapid economic growth would also imply the
need for structural changes in the economy as well as for induced shifts in the patterns of end-use
demands. To meet the needs of the Indian populace in the most effective manner, it is important to
map out the energy demand and supply dynamics in the country.
15

India is likely to surpass China as the largest source of energy demand growth in the world by
2035, according to the latest BP Energy Outlook 2035. The growth in demand for energy in India
will outpace each of the other so-called BRIC (Brazil, Russia, China, and India) countries,
recognized as the upcoming engines of economic growth in the world, the report said. India’s energy
demand is expected to grow by 132%, while China and Brazil’s energy demand will grow by 71%
and Russia’s by 20%. Growth in India’s energy demand will be around double the aggregate of non-
OECD countries. OECD countries refer to the 20 nations that are signatories to the Convention on
the Organisation for Economic Co-operation and Development, and mostly comprise mature
economies. India consumed around 536 million tonnes (mt) of coal, 42mt of lignite, 211.42mt of
crude, 46.5 billion cubic meters of natural gas, and 755,847 giga-watt-hours of electricity in fiscal
2012, according to a report titled Energy Statistics 2013, of the ministry of statistics and programme
implementation. The report, an annual feature published by British energy firm BP Plc, says India
and China will together account for half of the energy demand growth in the world till 2035, which is
pegged at 41%. Over the next two decades, India’s energy consumption is also expected to grow at a
significant rate of 11%, albeit at a lower clip than energy demand growth. This will compel India to
be dependent on imports of fossil fuels such as coal well into in the future, the report states. Across
fuel categories like liquids (crude oil, natural gas liquids) and coal, India is likely to outpace China in
terms of demand growth. In coal, for instance, China’s demand is declining, “driven by the
rebalancing of China’s economy towards services and domestic consumption, and supported by
efficiency improvements and more stringent environmental policy,” the report observes. India, on the
other hand, is continuing with its industrialization drive. Among fossil fuels, the biggest spurt of
183% in demand will be seen by natural gas, a commodity whose scarcity has already caused a few
concerns in the Indian economy. The country was supposed to have significant production of
domestic natural gas supply, especially from the high-potential Krishna-Godavari basin where
operators like Reliance Industries Ltd and Oil and Natural Gas Corp. Ltd are active. But geological
challenges have prevented this from materializing so far and heavy volumes of expensive gas are
being imported at present. India’s energy import bill may reach $300 billion by 2030, said Rahool
Panandiker, principal at Boston Consulting Group. “This has serious implications for policymakers
who need to come up with ways to ensure that domestic energy production is boosted as much as
possible, else factors like the current account deficit and geopolitical tension in oil and gas producing
regions of the world may pose a threat for India,” he said.
The continual increase in demand of fossil fuels for energy generation may meet the energy
crises of the country but on the other hand it will have negative impact on environment as a whole.
Thereby the drive to boost up the usage of renewable is required to be enhanced at the fast track so
that there will neither be deficiency of energy nor fear of degradation of nature.
Renewable energy sources are clean and indigenously available, and can play an important
role in addressing the energy security concerns of a country. Today, India has one of the highest
potentials for effectively using renewable energy sources. The country is the world’s fifth largest
producer of wind power after Germany, USA, Spain, and Denmark. There is a significant potential in
India for the generation of power from renewable energy sources—wind, small hydro, biomass, and
solar energy. The penetration of other renewable energy technologies, including solar photovoltaic,
solar thermal, small hydro, and biomass power is also increasing. Greater reliance on renewable
energy sources offers enormous economic, social, and environmental benefits. Increasing pressure of
population and increasing use of energy in different sectors of the economy are concern areas for

India. There is an urgent need to reduce energy requirements by demand-side management and by
adopting more efficient technologies in all sectors.
16
11. ENERGY INDEPENDENCE SCENARIO

In this ‘Energy Independence’ scenario the total primary energy demand in 2030 is lower at
1387mtoe (versus 1508mtoe in BAU). The fuel mix shifts towards renewable, although fossil fuels
remain dominant at 68 per cent of the mix. Underpinning the Energy Independence scenario is a
strong supply response and a focus on demand management. This is higher than current plans, but
not beyond reach given enabling market conditions. The biggest shift in the Energy Independence
scenario, however, is in the import dependence, which reduces to 15–20 per cent. Coal imports
reduce to 9 per cent, liquids imports reduce to 62 per cent, and gas imports reduce to existing LNG
contracts. While liquid imports remain high in this scenario, there is considerably higher flexibility
and tolerance across the fossil fuel basket, to optimize between coal, liquid and gas import volumes.
Next to this section, describes each of the initiatives for energy independence, and the actions
required to make them a reality.
1. Achieve 1200mtpa domestic coal production
Coal will remain the bedrock of India’s energy requirements for the foreseeable future.
Achieving 1200mtpa of coal production by 2030 will require incremental annual production of
950mtpa, to make up for existing mines that will decline over the next 15 years. This will require
India to:
1. Accelerate development of Coal projects which are at various stages of approval and
development
2. Fast-track captive coal blocks which have already been allocated, with a production potential
of 850mtpa. Some of these blocks are awaiting approvals or land acquisition, and another
have seen no development.
3. Allow private players to explore, develop and market coal. India has 7 per cent of the world’s
coal reserves and only 0.5 per cent of its exploration expenditure. Exploration and
development at scale will require market-based pricing and a robust coal market.
Import dependence on energy would reduce to 15–20 per cent
2. Unlock unconventional gas production
Several recent progressive steps have resolved many pending bottlenecks in upstream oil and
gas. To enable rapid development of 100mmscmd of unconventional gas, India must:
1. Expand the scope of its shale gas policy to include private and public sector players alike
Ensure sufficient fiscal and infrastructural incentives to attract investment in unconventional
supply chains and services
2. Allow full exploration and exploitation of all resources in NELP blocks
3. Allow market determined pricing for unconventional gas and the freedom to market gas.
3. Support conventional oil and gas production
To achieve 150mtoe of conventional oil and gas production in 2030, India will need to ensure
the viability of redeveloping its existing mature basins, e.g., western offshore, attract sufficient
investment into new licensing rounds, and remove the remaining bottlenecks to resource
development. In particular, it will require to:

17

1. Allow market pricing of crude oil from nomination blocks, to make the necessary high cost
investments in EOR4—and the related technology development-viable.
2. Ensure market pricing for gas and the freedom to market gas produced under NELP or the
proposed open acreage policy.
3. Streamline contract administration by enforcing time bound deemed approvals with
management committee accountability, codifying standard practices around grey zones in
product sharing contracts, defining policies for license extension, exploration in producing
blocks and extension of block areas, strengthening and empowering DGH5 and making it a
statutory body focused on approving and monitoring work programs, budgets and field
development plans.
4. Light up 50,000 villages through off grid solar
Traditional models are increasingly proving unviable to electrify and supply villages. Yet, the
demand surge and economic benefits in newly electrified villages are plain to see. Off grid solar (and
in places wind, bio mass and micro hydel) are better suited, scalable solutions to electrify remote
villages and supplement supply in partially electrified ones. To scale up off grid solar, India will
need to:
1. Fine-tune, scale up and roll out models that have been successfully piloted, while introducing
new elements like competitive bidding and viability gap funding to ensure competition and
transparency
2. Introduce village level OM capabilities and governance to manage distributed solar assets
Devise interventions/ incentives for rural micro-enterprises and other anchor loads (e.g.,
telecom towers) to shift to renewable solutions vs using diesel power
3. Channelize and attract funds from central and state budgetary allocations, corporate social
responsibility budgets, as well as private risk capital.
5. Add 100+ GW of grid connected solar and wind
India has demonstrated exceptional progress on the renewables front, more than doubling
installed capacity in the last 5 years, from 14.5 GW in 2008 to approximately 30 GW by December
2013. This translates to more than 3 GW of installed capacity per year. Though outstanding, India
would need to, on average, double this rate over the next 15 years to achieve the 100 GW aspirations.
This would need India to:
1. Enforce Renewable Purchase Obligations (RPOs) unilaterally. Targets have been set for each
state. Renewable Energy Certificates (RECs) remain unsold, forcing REC prices to floor
levels, significantly eroding developer returns. Mandating states to meet RPO targets, and
enforcing penalties for noncompliance would be required.
2. Invest in low wind speed technology with focus on building domestic RD and
manufacturing capabilities to add 40+ GW by 2030.
3. Devise interventions and incentives for rural micro-enterprises and other anchor loads (e.g.,
telecom towers) to shift to renewables vs using diesel.
4. Introduce a peaking power policy to allow developers to invest in storage to make solar
viable for evening peaks.
6. Reduce industry and building power demand by 30 per cent
India’s overall energy intensity at 0.56koe/USD is high compared to even other developing
countries like Brazil at 0.25koe/USD or Malaysia at 0.4koe/USD, indicating significant improvement
potential. India has started positively on this journey, achieving energy intensity reductions of 1 per
cent per year. A substantial amount of demand reduction is already assumed in the BAU case

(equivalent to 344mtoe with energy intensity dropping to 0.47koe/USD). An energy intensity of
0.4koe/USD by 2030 could be achieved by:
18

1. Reducing residential and commercial energy intensity. This would involve increasing
penetration of labelled appliances from 20 to 90 per cent, CFL/ LEDs from 15 to 90 per cent,
and stringent implementation of the ECBC norms for commercial buildings Targeting energy
reduction in power intensive industrial segments through year on year targets, time of day
tariffs and incentivizing production of energy efficient industrial equipments.
2. Driving energy efficiency in agriculture, moving towards electric pumps (from diesel) and
mandating use of Bureau of Energy Efficiency (BEE) star labelled equipments.
3. Reducing ATC losses: India’s ATC losses at about 23–24 per cent are extremely high
compared to 5 to 7 per cent in best practice countries like Japan, Germany and Korea. Even
some developing countries, e.g., Malaysia have achieved sub-10 per cent loss levels. India
could achieve these levels through a mix of technology (e.g., smart grids) and effective
distribution ownership and management.
7. A stronger technology ecosystem
India must focus on increasing technology depth across all parts of the value chain through:
1. Larger RD investments, since Indian energy companies spend between half to one-fifth of
their global counterparts on RD, on a per barrel basis
2. Greater RD effectiveness through stronger RD processes and approaches, dedicated
research cadres, closer monitoring of outcomes and a greater commercial orientation
3. Global and Indian collaborations, which could take the form of bilateral alliances, industry
forums, academic alliances or venture investments in technology firms
4. Incentivizing and attracting local manufacturing in the energy value chain, including oil field
services, specialized materials and chemicals, and energy efficient storage and usage
technologies.
8. Catalysing industry participation and investment
While some of these have been mentioned earlier, the importance of reliable market
mechanisms in attracting private investment cannot be over emphasized, including:
1. Market-linked prices and marketing freedom for gas and coal
2. Moving subsidies to an arm’s length basis, directly to consumers as far as possible, to avoid
distortions in industry conduct and inappropriate incentives for consumption
3. Ensuring new policies are not enacted with retrospective effect.
9. Mobilizing institutions and markets
10. A central energy fund
An ambitious agenda for energy independence would benefit from a source of funding to be
able to drive targeted investments and influence outcomes. An energy fund established with
contributions from large Indian energy players and the government, run on the lines of a professional
fund, could serve to:
1. Enable and catalyze consortia to bid for large international assets and corporate entities
(primarily across coal, gas and liquids), and
2. Share investment risk during development of unproven technologies and applications, and
Incubate new technology ventures.

19
12. CONCLUSION

India is the world’s fourth largest economy as well as the fourth largest energy consumer.
India imports a substantial portion of its energy from coal, oil gas. As the Indian economy
continues to grow, so will its energy consumption, especially as the growth of its manufacturing
sector catches up with services and agriculture. With domestic resource production facing various
challenges, the general expectation has been that Indian energy imports will continue to grow, and
energy security concerns will intensify. The outlook and options for Indian energy independence
therefore becomes an important topic. In view of above facts, it is essential that a 2030 outlook is
particularly relevant, since it is difficult to significantly change energy policy thinking in 5/10
years, but almost any boundary conditions can be changed over a 15-year period. Moreover, there
have been few if any, in-depth perspectives on this topic for 2030.
India’s energy demand, which was nearly 700mtoe (million tonnes of oil equivalent) in 2010,
is expected to cross 1500mtoe by 2030. Its dependence on imports is expected to increase from 30
per cent to over 50 per cent, suggesting the need for a new way forward. India’s primary energy
demand by fuel type in 2010 and business as usual (BAU) projections for 2030. Primary demand in
2010 stood at 691mtoe. Of this, about 41 per cent was coal, 24 per cent was liquids, 23 per cent was
non-commercial fuel, 8 per cent was gas, and the remainder was a mix of hydro, renewables and
nuclear power. Despite recent strides in renewable and nuclear power, this is a predominantly fossil
fuel based mix, with 73per cent of primary energy coming from coal, oil and gas.
Possible import dependence above 50 per cent of 1500mtoe and growing is a clear indication
that a different set of energy outcomes versus BAU will be required if India is to keep its growing
economy supplied with sufficient reliable and cost effective energy. Domestic resources will need to
be explored and exploited to target levels that have not been traditionally considered in current long-term
plans. This will require stable, viable market mechanisms that attract sufficient investment
across the value chains. All possible energy sources will need attention, including coal, conventional
and unconventional oil and gas, renewables, nuclear power and energy efficiency. Following are the
factors that give India the opportunity to address its energy security concerns:
1. India has ample opportunity to increase coal production, provided transparent resource
access and development regulations are put in place
2. India has substantial unconventional hydrocarbon potential, even though reserve
estimates vary widely at this early stage
3. Conventional oil and gas still holds great potential in India, especially via the
redevelopment
and intensive exploitation of existing mature basins, provided viable pricing and taxation
mechanisms are in place
4. India has had remarkable momentum in increasing renewable power capacity (both wind
and solar), and doing so while setting global cost benchmarks
5. With a vast proportion of India’s infrastructure yet to be built, India can leapfrog the
developed world in energy efficient buildings, long distance rail transportation, and an
optimal road-rail modal mix etc.
6. India has a unique opportunity to create stronger and more secure supply partnerships
with oil and gas supplying countries in the Middle East and Africa, who will be seeking
large and stable markets to absorb imports displaced by the US.
We believe that it is possible for India to achieve substantially higher domestic energy
supply, lower demand and more secure imports than in the BAU case by utilizing the ample

resources of renewables at an affordable cost and for longer period without disturbing the fixed
available resources of fossil fuels keeping them safe forthcoming generations.
20
REFERENCES

[1] www.ideasforindia.in (The Unsustainability of fossil fuel use in India by R. Sengupta) -
http://www.ideasforindia.in/article.aspx?article_id=126#sthash.HVMbtHxj.dpuf.
[2] http://www.groundtruthtrekking.org/Issues/AlaskaCoal/CoalTerminology.html#ixzz3I4WPVQ
sd.
[3] http://www.futuredirections.org.au/publications/indian-ocean/1118-meeting-india-s-energy-requirements-
in-2030-1.html#sthash.OmolPeTf.dpuf.
[4] http://www.livemint.com/Industry/DkEx9mPwpSso24SWhBMxrL/Indias-energy-demand-to-surpass-
Chinas-by-2035-BP.html?utm_source=copy.
[5] http://www.currentscience.ac.in/Volumes/105/07/0914.pdf.
[6] en.wikipedia.org/wiki/Integrated_gasification_combined_cycle Extract from paper: national
energy map for India – technology vision 2030.
[7] Dr.S.M.Ali and Prof. K.K.Rout, “Application of Renewable Energy Sources for Effective
Energy Management”, International Journal of Electrical Engineering Technology (IJEET),
Volume 1, Issue 1, 2010, pp. 18 - 31, ISSN Print : 0976-6545, ISSN Online: 0976-6553.
[8] Archana S. Talhar (Belge) and Sanjay B. Bodkhe, “Modernization of Traditional Grid into
Smart Grid through Renewable Sources”, International Journal of Electrical Engineering
Technology (IJEET), Volume 5, Issue 2, 2014, pp. 1 - 11, ISSN Print : 0976-6545,
ISSN Online: 0976-6553.
[9] M.R. Kolhe and Dr. P.G. Khot, “Coal – An Energy Source for Present and Future”,
International Journal of Management (IJM), Volume 5, Issue 10, 2014, pp. 71 - 90, ISSN Print:
0976-6502, ISSN Online: 0976-6510.
ABBREVIATIONS
CCS-Carbon Capture Storage, IEA-International Energy Agency, IGCC-Integrated gasification
combined cycle NELP-New Exploration Licensing Policy, CHCP-Combine Heating Cooling
Plant, OECD-Organization for Economic Cooperation and development, Mtoe- Million tonne oil
equivalent, BAU-Business As Usual, MTPA-Million Tonne Per Annum, OM-Operate
Maintenance, RPO-Renewal Purchase Obligation, BEE- Bureau of Energy Efficiency, ATC Loss-
Aggregate Technical and Commercial Loss, RD-Research Development, ECBC-Energy
Conservation and Building Code, CAGR- Compound Annual Growth Rate.
AUTHOR’S PROFILE
M.R. Kolhe, received the Bachelor of Engineering degree in Electrical Engineering from
Visvesvaraya Regional College of Engineering Nagpur (now: Visvesvaraya National Institute of
Technology, Nagpur) and M.B.A. degree from GS College of Commerce, Nagpur in 1974 and 1990,
respectively. During 1975-2013, he worked in Western Coalfields Limited (Government of India
Undertaking) and retired in 2013 as General Manager (Electrical Mechanical).

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