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We Need All The Three - Energy, Environment and Forest , Shri R V Shahi, Former Secretary, Ministry of Power

On 25th June, 2009 the leading Business Daily "The Business Standard" gave a lead editorial "Coal or Forests? - The country should not be asked to pick between the two". The Daily has indeed brought an important issue into focus and it needs serious debate and discussion. Though, major portion of this editorial is tilted towards the need for preserving the forest coverage, in the concluding paragraph it does bring out the need for increasing coal output specially because India possesses huge coal reserves and it faces recurring coal shortages. The Article brings out predominantly the problem of destruction of forest on account of development of coal mines and says "The fear, therefore, is that what are now described as open forests, scrubs and non forests may be demarcated as de graded forests for this purpose. If that is the case, it will ultimately reduce the country's overall forest cover already woefully short of the desired 33% mark". This comment in the editorial is with reference to the reported decision of the Government to give faster clearance to coal projects in de graded forests. The comment on this decision goes to the extent "may help boost coal production, but it bodes ill for the country's forest cover". As mentioned, the Article does bring out the imperative need for coal sector reform and for giving speedy approval for coal projects, but "this needs to be done without adversely affecting the health of the country's forests ...... how to do this is of course the question that the Government must address".

Bringing out the problems and challenges is, no doubt, an important step, as has been done by this Daily, for creating alternative approaches and solutions. But, this is not adequate. We must generate the strategy and action plans which would effectively address and mitigate these problems. Secondly, the problem of energy is not limited to coal. Therefore, while the issue of debate whether coal or forest is, no doubt, an important issue, we need to appropriately enlarge the scope of this debate. It is gratifying that India is endowed with a lot of natural and mineral resources. In the Energy Group, we have substantial coal reserve, huge water resources and in the recent years, it has been discovered - and that process continues - that India also has large oil and gas reserves. The issue of environment and forest versus coal, therefore, has to become the issue of environment and forest versus all energy programmes. The debate, therefore, must centre around energy, environment and forest. Indeed we need all of them. It is not the question of choosing one option and leaving others. Do we have any choice at all to slow down our energy programmes? In the last 25 years, many of the Asian countries - and we are not talking of developed countries of America and Europe - which were at par with, and in some cases even inferior to, India have now left us behind. Our inclusive growth agenda, together with a sustained annual growth rate of about 9%, over a long period of time, cannot be realized unless we evolve out-of-box solutions on energy development and provide to the economy the most vital input to propel such a growth.

What are the options, we have, to achieve this?

  1. Inspite of our best efforts, and also with the commitment to financially incentivize, at a cost, the new and renewable energy programmes such as wind, bio-mass, solar, geothermal, tidal etc. they will not be in a position to contribute more than 10% of electricity generation in the next 25 year time frame. At present, though in terms of installed capacity they constitute about 10%, in terms of generation of electricity it is only around 3%. In any case, we must intensify our efforts, including research and development initiatives, so that atleast beyond 25 year timed frame, if we are able to develop cost effective technologies, we could expect a better proportion of contribution by these energy resources.

  2. Inspite of the discoveries in the gas fields achieved so far, and also keeping in view the future projections, the present proportion of gas based electricity generation which is about 10% in terms of capacity but about 7% in terms of electricity generation, is unlikely to move upward in a significant way. Even if we assume an optimistic scenario we could at the best expect, though doubtful, only a marginal improvement as compared to the present proportion of gas based power generation, may be a maximum of 10%.

  3. While a large number of countries in the world continue to debate the merits and demerits of, and projected safety issues linked with, nuclear power plants, in India we have succeeded in convincing almost all the stakeholders that for India it is a good option and we should pursue our power generation programmes based on nuclear technology. But, here again, the best case scenario, in the 25 year time frame will be a shift from present less than 3% to about 6-7% of the total power generation capacity.

  4. These leave us, then, with two important energy options viz. water resources and coal reserves. Even with reference to optimistic projections, non conventional energy sources (wind, bio-mass, solar etc.), gas and nuclear, we may not expect more than 25% of electricity generation from all these categories, though in terms of capacity the proportion could be larger, may be in the range of more than 30%. This means that more than 70% of electricity generation will have to be from water and coal. Let us deal with water resources first. Based on the investigations and studies conducted so far, India has an estimated potential of the order of 150 GW (these may be more if certain small rivers and rivulets, which may not have been captured in these investigations, get also estimated). The Government initiatives, with renewed and incentivized policies, may encourage development of these projects, but in the next 25 years, realistic estimate of capacity additions may not substantially lead to a major shift upward in its present proportion of 25% of total capacity and about 17% of total generation of power.

  5. In any case, water resources are one of the largest energy segments for India. The capacity and proportion of generation of power may marginally increase in view of mini and micro hydel projects and also if further investigations lead to new discoveries of potentials. All these will, however, be dependant almost fully on how we manage the project execution starting from establishing feasibilities to getting all types of clearances and then execution. Just as in case of coal projects, most of the hydro projects involve massive forests, in many cases forests with wildlifes. Our present approach to accord environmental, forest and wildlife clearances are less than encouraging for speedy development of these projects. We need to note that in last thirty year hydroelectric capacity in India has gone down from more than 40% to 25% of the total power generation capacity, even though it is a clean renewable source of energy. Though there are greater degree of uncertainties and geological surprises during execution which contribute to delays, the initial commencement invariably gets delayed on account of prolonged process of environmental and forest clearances, which include going upto Supreme Court.

  6. Hydro projects meet with considerable amount of opposition and resistance from local population as well as from a number of NGO's. This is so because storage projects involve dislocation of towns and villages and forests which get uprooted. These opposition and resistance are not totally illogical. Our track records, both at the level of developers as well as at the level of authorities, have been less than credible. Let us look at the following few facts:

  1. It is an established practice and procedure that when forest clearances are accorded, the project development companies have to deposit huge amounts of money which needs to be used for afforestation of land, which is double of forest land that is likely to be destroyed. In the last few years there has been substantial upward revision in the amount of deposit because of a new concept of "Net Present Value (NPV)" which conceptually is an attempt to compensate for direct and indirect consequences of forest denudation. Secondly, the project development agencies are required to commit and deposit huge sums of money meant for what is called "Catchment Area Treatment (CAT)".

  2. On both these accounts, the performance of the State Governments, in most cases, has been far from being satisfactory. The sums of money deposited have been used mostly for various other purposes including meeting the requirement of ways and means of these Governments as well as for maintaining a large establishment in the Forest Departments. In a number of cases, not even 25% of the fund so generated has been used for the purpose for which the money was deposited. Almost similar has been the case in many States in the field of Catchment Area Treatment, with the consequence that during the heavy monsoons not only the entire area gets affected but the power plants themselves get water with large and heavy silts. These obviously create a negative impression and perception, and not wrongly so, about such projects, among the people affected, as also among the nearby population. A sense of frustration, hatred, anguish and, therefore, all these culminating into very strong pockets of resistance, has normally been the outcome of such an apathy, indifference, and if it can be called, irresponsible behaviour, on the part of both developers and authorities.

  3. I recall, during the year 2003-04, I approached the Ministry of Environment and Forest for an effective implementation of the concept of Forest Bank through a Special Purpose Vehicle (SPV). We had organizations like NTPC, NHPC and others, who normally need, for their project development, forest areas. As per this Scheme they would be required to deposit fund into the SPV and the Company (SPV) would undertake the responsibility of development of large State level, regional and national forests. The suggestion was also to include the coal project development companies who have even greater need for larger areas of forests for developing coal mines. The point of view of the Ministry of Power was very simple and forthright. It was that we had trusted the State Governments and their forest agencies for far too long. The utilization of fund has been much less than satisfactory. There is no point in blaming the public of the area in general and also the NGO's who have developed a general resistance to such large projects. The problem indeed lies with the system and the authorities. The credibility has been so badly eroded that even the good projects, with good intentions, with money provided for developing forests but not used, are facing serious difficulties in implementation. By now, over a period last 20 years, we should have been in a position to demonstrate that if the Governments have been deposited funds to create double the size of the forests that have been destroyed, the same has been accomplished. In that case, the wrath and anger would have not only diluted but the good examples of the new forests developed would have inspired people to support these projects rather than oppose them. I only wish that this SPV concept had taken place and, as a system of governance, we could have been in a position to vindicate ourselves and to create better levels of confidence among people about our commitment to environment and forest. Even now, I genuinely and sincerely feel that there is no point in continuing to believe that the State Forest Departments in general, barring a few rare exceptions, could be in a position to perform in a manner that would be worthy of earning the trust and confidence of people in general. And, therefore, even though it is too late, we should effectively implement the concept of forest development through SPV as a corporation jointly created by the Central Public Sector Undertakings, Ministry of Environment and Forest, Ministry of Power, Ministry of Coal and such other Departments and organizations.

  4. On hydro projects, while talking of environmental issues, there have been even greater and more serious slips on the part of the system of governance. This has eroded the confidence of people about hydro projects to, infact, even a greater extent. The policy of providing 12% free power to the State, in which the hydroelectric project is located, was aimed at mitigating the distress and hardship caused in the area. The amount of revenue that can be generated from 12% of power produced in the hydroelectric project, year after year, if utilized properly for various activities including infrastructure, community development, social welfare etc. in the area, could go a long way in not only raising the level of standards of people in the State, but these initiatives would have created magical positive effect in support of these projects. The recent Hydroelectric Project Policy does provide for some additional revenue (equal to 1 paise per unit of power) for community development. It is important that the Central Government stresses upon the State Governments about the need for utilizing the revenue generated from 12% free power, and creates an independent institutional framework which is able to succeed in getting this money channelized into a fund which is used for local area development and social welfare schemes.

  5. Rehabilitation and resettlement in cases of such hydroelectric projects, as have to have large storage schemes necessitating dislocation of thousands of families in large number of villages and towns, is another important area of concern. While there are a few good examples of proper township development and also Schemes to enhance earning potentials and capability of affected people, in most cases various State Governments have been unable to implement properly the Rehabilitation and Resettlement Schemes. The contention of the affected population and also of the NGO's in such cases are not without basis. I would also like to emphasise that in almost all such cases it has not been the lack of fund which has been the issue, but it has been the lack of proper implementation and delivery of desired outcomes. I am optimistic that even now, if proper implementation agencies are put in place with appropriate mechanism to ensure, through monitoring, meticulous execution, we will be able to win over the people and the NGO's in favour of these projects. It is my strong belief that we don't need to have a choice between energy development or environment and forest, but we can have, in a harmonious fashion, all the three.

  1. Now let us briefly discuss the coal mining projects and environment. As articulated earlier, India doesn't have a choice of harnessing selectively one or the other energy resources. Our needs are so enormous that we would be called upon to harness all forms of energy. May be, during the periods beyond 25 years, technological revolutions in the fields of solar energy, bio-mass, geothermal etc. are able to achieve such big breakthroughs that all of them become fully affordable that the energy mix might undergo a radical change. But, during the next 25 years, our dependence, in a significant way, on coal cannot be avoided. All types of Clean Coal Technologies with full commitments and major technological innovations can be the only answers to make coal and environment compatible with each other. We need to focus right from extraction of coal to its combustion and beyond, on emissions, in a manner that technologies support environmental expectations. It can be made doable.

  2. In the long term there are better possibilities. Carbon Capture and Storage (CCS) from coal based power plants is one such option. Jeffery D Sachs, Professor of Economics and Director of the Earth Institute of Columbia University, who is considered a world authority on environment, has written in one of his recent papers (Refer Economic Times, June 27, 2009) :

"Addressing the problem of climate change requires reducing emissions of carbondioxide from fossil fuels, which in turn involves choices of technology, some of which already exists and much of which needs to be developed. For example, coal plants, if they are to remain a major part of energy mix, will need to capture and store their CO2, a process called Carbon Capture and Storage (CCS). Yet this technology remains unproved."

I was myself associated for more than three years on the Policy Group of Carbon Sequestration Leadership Forum (CSLF), a global forum initiated in 2003 by the Government of U.S.A., and subsequently on the Steering Group of Zero Emission Future Gen Project. I am convinced that CCS will take atleast more than 10-15 years before it could become a cost effective technology. But, we all must work towards that goal. Together with CCS, other clean coal technologies including radical improvements in the efficiency of fuel consumption and thermodynamic efficiency of power generation process also must be worked on.

  1. Development of coal mines invariably leads to large scale destruction of forests. One of the reasons has been the massive shift of Indian coal industry from underground mining which constituted almost 70% of total mining about 30 years ago to now 70% as open cast mining. This has really brought strong objections and response from affected people and NGO's. There is, therefore, a need to once again improve radically the proportion of underground mining. As discussed in respect of hydroelectric projects, massive afforestation leading to creation of new forests of double the sizes of those destroyed for coal mining is the right answer. What has been wrong, and continues to be so, is our overdependence on the existing organizational framework and machinery which is expected to deliver these results but have unfortunately continued to fail to deliver. A dedicated Forest Corporation under Government of India, with defined tasks, funded as discussed earlier by the power, coal and other project development companies, has been over due and needs to be set up and operationalised.

In this brief write-up, I have attempted to answer the question whether the country has to choose energy on the one hand and environment and forest on the other hand. The answer is simple. We can ill-afford a growth in energy production of less than 8% in a sustained way to provide to Indian people, more particularly to about 50% those who have remained deprived of energy, to enhance their quality of life. Therefore, there is no choice not to have it. But, does this choice lead us to not have environment and forest? The answer is "NO". I have made some suggestions which broadly highlight how we can make environment and forest compatible with energy development programmes, even though not fully, to a great extent. There are things which could have been done but were not done. The future is with us and we can make them happen. There is a great scope to create a "win-win" situation in the manner described. What would be necessary is to radically restructure our method of working, convince particularly the State Governments to appreciate the enormity of the problem and challenge and also the need for new ways to address these issues. Their full co-operation and commitment would be essential to make the new approach take-off and be instrumental in delivering the effective outcomes. This is the way we can expect to have all the three - Energy, Environment and Forest.