Power Management
Are we serious about our energy security?
Introduction
In his New Year message, Prime Minister Manmohan Singh outlined energy security as one of the five key challenges facing the country. While this is indeed true, unfortunately, the Government response to this challenge has been very weak and inadequate. Fuel price reforms and enhancing nuclear capacity are the most discussed options to address the energy security challenge. Though merits and de-merits of these options could and should be debated, there are several other options which have been languishing for want of any firm actions. This short article first presents the magnitude and importance of the challenge, and then narrates how inadequately the Government has responded to it.
2
India’s energy security
We expand the definition of energy security asgiven in India’s Integrated Energy Policy (PlanningCommission, 2006) to not only include the ability to reliably access requisite quantity of energy at a reasonable costand provide clean, modern energy access to the entire population1, but also that the production and end-use of energy should have minimal health and safety hazards. In this paper, we focus on the threat to energy security from very high external dependence as it increases uncertainties of price and availability of energy, particularly in view of increasing resource nationalism around the world. India’s net2 imports of energy (petroleum, coal and gas) increased from 129 mtoe (million tons oil equivalent) in 2006 to 191 mtoe in 2010 representing a growth of 10% p.a. This is likely to increase to about 227 mtoe in 2011-12. Supply and demand projections for the 12th five year plan indicate that imports will further grow to about 366 mtoe in 2016-17 (Figure 1). That is, the country’s energy imports would nearly triple in just over a decade from 2006. Such a rapid increase in imports also implies a significant financial burden on the economy. At current prices, the total energy import
Introduction
In his New Year message, Prime Minister Manmohan Singh outlined energy security as one of the five key challenges facing the country. While this is indeed true, unfortunately, the Government response to this challenge has been very weak and inadequate. Fuel price reforms and enhancing nuclear capacity are the most discussed options to address the energy security challenge. Though merits and de-merits of these options could and should be debated, there are several other options which have been languishing for want of any firm actions. This short article first presents the magnitude and importance of the challenge, and then narrates how inadequately the Government has responded to it.
2
India’s energy security
We expand the definition of energy security asgiven in India’s Integrated Energy Policy (PlanningCommission, 2006) to not only include the ability to reliably access requisite quantity of energy at a reasonable costand provide clean, modern energy access to the entire population1, but also that the production and end-use of energy should have minimal health and safety hazards. In this paper, we focus on the threat to energy security from very high external dependence as it increases uncertainties of price and availability of energy, particularly in view of increasing resource nationalism around the world. India’s net2 imports of energy (petroleum, coal and gas) increased from 129 mtoe (million tons oil equivalent) in 2006 to 191 mtoe in 2010 representing a growth of 10% p.a. This is likely to increase to about 227 mtoe in 2011-12. Supply and demand projections for the 12th five year plan indicate that imports will further grow to about 366 mtoe in 2016-17 (Figure 1). That is, the country’s energy imports would nearly triple in just over a decade from 2006. Such a rapid increase in imports also implies a significant financial burden on the economy. At current prices, the total energy import