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Contemporary Energy Issues, Shri R V Shahi, Former Secretary, Ministry of Power

In last few days, we have come across, in various electronic and print media, a number of issues, concerning energy, which are under debate and discussions. All are important. But I have picked up couple of these issues to discuss in this paper - (a) Controversies about certain aspects of the Fourth Report of the Inter-governmental Panel on Climate Change (IPCC), (b) City gas distribution license and jurisdiction of the Petroleum and Natural Gas Regulatory Board.

(a)

Controversies about certain aspects of the Fourth Report of the Inter-governmental Panel on Climate Change (IPCC)

The inter-governmental Panel on Climate Change has been, on a regular basis, bringing out series of Reports on issues connected with climate change. Since it is a U.N. Body, the studies, findings, conclusions and recommendations receive global attention and recognition. Though all the previous Reports of IPCC are reference documents, the Fourth Report had much wider attention throughout the world. The main reason was that it is in this Report that adverse consequences of global warming and climate change were brought out in very specific terms. More importantly, it received immediate attention from all including the Heads of Governments of various countries, because it brought out that devastating consequences were coming sooner than later. The Report supported these findings on the basis of various studies done by different agencies. Therefore, when some of the important findings are now being proved to be wrong, the reciprocating reactions are not unexpected. We, however, need to take a balanced view on the issue. In this context, a few points which need to be brought out are outlined below:

  • The severe most criticism, from various quarters, has been on account of the finding that Himalayan glaciers will melt away by the year 2035. This conclusion did have a major impact on the minds of people and a panic like situation got created all over. Now it emerges that the year 2035 is more than 300 years away from the year 2350 which, perhaps, could be more near the conclusion. Even on that, there are differing views. In any case, the source of this conclusion itself is now contradicting the finding. It is gratifying that IPCC Chairman has confirmed that it was a mistake which crept in the voluminous Report. The critics question the timing of admission of this mistake. They point out that when this was highlighted much earlier than the Copenhagen Conference, why it is that the IPCC did not clarify and admit the error, so that the deliberations in the Copenhagen Conference would have duly taken this into account. A counter argument could be that even with those major consequences and timings thereof, the Copenhagen Conference did achieve practically nothing. So what if the mistake was not admitted earlier?

  • Apart from the melting of Himalayan glaciers, the criticism on the findings of the Report also relates to claims of melting mountain in the Andes, Alps and Africa. The criticism suggests that these findings were based on Articles produced as a part of research work done by Master's Degree students. Obviously it is a valid criticism that such conclusions in such an important Report should have found place only on the basis of very extensive research work done and peer reviews by International Institutions. The answer from IPCC is on similar lines that a few errors here and there should not be highlighted to dilute the essential message of the Report. It has not come out with convincing answers on why it had to depend on references which are not from reputed and credible sources.

  • IPCC is also being criticised on account of its claim on disappearing Amazon forests saying that the findings were based on a Report by environmental activists. IPCC seems to be addressing these criticisms in a manner that while the issue concerning melting of glacier is admittedly an error, this august body cannot be expected to answer queries and criticisms coming from various quarters. This position of the IPCC is, no doubt, has some basis, but when specific criticisms, based on facts are brought out, they needs to be addressed.

  • On the other hand, there seems to a suggestion from IPCC about the conspiracy being mounted by vested interests to discredit IPCC and the conclusions of the Report. There could be a possibility, world is divided on this issue.

  • On the overall basis, there is substantial strength in the argument of the IPCC that the consequences of global warming are real. Extent of enormity of these consequences could differ, just as the time periods during which these could happen. We need to agree that Climate Science is yet to mature. To expect that predictions would be accurate and that too with specific time frame could be unrealistic. We all know that even weather forecasts, in terms of days and weeks ahead, have been found to be erroneous. Weaknesses and inadequacies of Climate Science cannot be the reason for not making efforts towards perfection of this Science. What is, however, creating the whole controversy is the absence of appropriate disclaimer in the IPCC Report. The world is used to uncertainties about these predictions. We are very much aware of, and we have been dealing with, the Geological surprises in mining and in underground works relating to large irrigation and hydroelectric projects. Therefore, admission of the weaknesses of scientific investigations is indeed the right approach.

  • A few lessons which can be drawn from this controversy are as follows:

  1. Economic growth, throughout the world and particularly in developing countries, has suffered considerably by actions of ill informed environmental activists. There are a number of reputed and responsible NGO's which carry out systematic studies, and depend on studies done by reputed individuals and organisations whose findings could be considered credible, before they indulge in policy advocacy. Obviously, the number of such NGO's is very few. There are a large number of NGO's who are ill-informed, misguided and quite often funded by vested interests. They pretend to be knowledgeable and project their findings, conclusions and recommendations as if they were based on comprehensive relevant studies and investigations. They decelerate the process of industrial and economic activities causing irreparable damage. We must guard against such activists.

  2. United Nations bodies like IPCC obviously cannot be expected to rely upon studies, articles and statements by all and sundry. Only such references must find places in these Reports as are highly credible an internationally recognised. This is also a lesson at the local level in our own country. There should be a system which should distinguish reliable and responsible NGO's and individuals from those who indulge in such activism without support of substantial and detailed studies and investigations. As a matter of fact, there is a need that irresponsible NGO's should be exposed in the society.

  3. No doubt, the errors which crept in the IPCC Report do impact the reputation of this institution. Yet, the type of criticism which is being leveled against the organisation and its Chairman is disproportionate. Since this organisation has admitted the mistake, and since to err is human, the controversy should not be prolonged, because climate change issues are highly relevant issues for the world. Hopefully, in the Fifth Report of the IPCC the findings would be based on a more careful scrutiny of studies that have been done.

  4. It is also not totally out of context that IPCC is voicing concerns about certain organisations, or countries trying to deliberately damage the reputation of this institution because it has brought out that there are a large number of countries, particularly the advanced ones, which have been increasing the carbon emission. There is a good possibility of such a co-ordinated action by these countries to discredit this institution. In future discussions countries like India will need to keep this in mind. There is a clear conspiracy to dump the Kyoto Protocol. We need to understand the game plan and keep this protocol at the core of negotiation.

(b)

City gas distribution license and jurisdiction of the Petroleum and Natural Gas Regulatory Board

Availability of domestic gas has always been an area of concern. With the limited quantity of gas produced in the past, mainly by ONGC, the two largest consumers viz. power and fertiliser sectors always complained of shortage of supply and, therefore, under utilisation of their plants. With the production of gas from KG Basin by Reliance Industries, the situation has improved and accordingly performance of power plants based on gas has also improved. Increased gas supply has also resulted in expectation all over the country for larger allocation of gas for city gas distribution system including compressed natural gas for transport. In the cities in which domestic gas supply was started more than 10 years ago, such as in the cities like Mumbai and Delhi, expansion of coverage of households has been rather slow. In these cities, there is demand for increased gas supply, so that areas not covered so far are also covered. But, more importantly, a large number of towns and cities have been aspiring for city gas distribution network and gas supply to their houses. Also example of Delhi using CNG for transport leading to better environmental outlook, is inspiring other towns and cities to have CNG for the transport system. There has been thinking in the Government on the positive side to provide larger allocation for city gas system.

What has, however, been standing in the way of expansion of CGD to large number of towns, where agencies have been preparing for it, is the confusion that has been created on whether the Petroleum and Natural Gas Regulatory Board has the authority to issue license or the Ministry of Petroleum and Natural Gas. In a few cases, the Regulatory Board granted the license. It was disputed in the Court and finally the High Court has given its judgement saying that the Regulatory Board has not been empowered by the Government to grant license.

I have written in the past on the half hearted approach of the Ministry in respect of the Regulatory Board. It has been established beyond doubt that Petroleum Ministry does not wish to part with any authority. Firstly, when the Regulatory Board was created, it was given truncated jurisdiction of covering only downstream segment leaving the upstream sector out of their authority. Section 16 of the Act provides the power to the Government to notify authorisation to the Regulatory Board to grant license. The Ministry has not done it. Obviously the judgement of the High Court has been on the basis of this provision of the Act according to which the power could vest in the Regulatory Board only after the notification by the Government. The question arises as to why the Petroleum Ministry did not act to issue necessary notification.

This is a usual tendency on the part of many Government Departments not to part with the authority they have. The whole idea of creating Regulatory Institutions is to distance the Government from direct decision making in such cases. The underlying principle is that, in many cases, if the Government has to decide, it gets subjected to political compulsions more than a Regulatory Authority. Independent quasi-judicial institutions could be expected to take objective decisions on commercial lines and may not be as much vulnerable to extraneous considerations like political expediencies. The consequence of such an approach by the Petroleum Ministry has been obvious. In most cases, whether it is the issue of subsidy on petrol, diesel, LPG, or the issue of allocation of natural gas or the issue of pricing of gas, the Ministry has always been under stresses and strains, and rightly so, because the criticism will obviously be pointed towards the agency which keeps the authority.

There are two suggestions - (a) In the short term, the Government should consider issuing necessary notification under Section 16 of the Act to empower the Regulatory Board with required authority, so that the process of licensing city gas distribution is expedited. (b) In the medium term, the whole Petroleum and Natural Gas Regulatory Board Act needs to be reviewed and the matter as to why they have been given truncated authorities needs to be re-examined. If the Directorate General of the Hydro Carbon is not converted into a quasi-judicial Regulatory Authority, then present Regulatory Board should have enlarged authority to cover the upstream segment as well.