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Energy Security: The Way Forward For Asean and India, Shri R V Shahi, Former Power Secretary,, Ministry of Power

Federation of Indian Chambers of Commerce and Industry (FICCI) organised a discussion on January 21st and 22nd 2009 on "Regional Security and Cooperation Dialogue" at New Delhi. One of the main themes discussed in this "Delhi Dialogue" was "Energy Security : The Way Forward for Asean and India". I had the privilege of addressing this Session to highlight the energy security aspect in relation to power. Other Speakers included Senior Officers from Ministry of External Affairs, former Cambodian Ambassador to Japan and Visiting Research Fellow at the Institute of South East Asian Studies, Singapore. The issues covered by me and those highlighted by other distinguished Speakers are briefly outlined below :

  • India's energy needs are likely to grow, in all the segments of energy, at rates which should correspond to the target of over 9% of annual economic growth rate over a long period of 25 years. This would mean that the energy production growth should be atleast 7 to 8%.

  • In respect of electricity, the Integrated Energy Policy has projected two scenarios to support, in a comfortable manner, the GDP growth rates projections. A conservative estimate suggests an electricity generation growth rate of 8% and a little liberal rate suggested is 9%.

  • If we take both these projections into account and present a balanced estimate, India should be having an installed capacity of the order of 800 GW by the year 2032 (end of XVth Five Year Plan), as compared to the present installed capacity of about 145 GW.

  • These projections, though they may appear on the higher side, are absolutely necessary to materialise to take care of (a) the present shortages in the electricity supply which are as high as about 10% (average shortage) and about 15% (peaking shortage), (b) the fact that more than 50% of rural India is yet to be provided access to electricity, and such areas as have already been provided electricity access are facing load sheddings of 10 to 15 hours a day, in some cases even longer durations, and (c) in addition, the economic growth rate, to be achieved on a sustained basis, of the order of 9%, will require, as a prerequisite, the propulsion of energy without which such growth rates are impossible to be realised.

  • In many ways, India's problems are unique. The task is challenging because such huge capacity additions, which are imperative, are not required in any other country, including in China, which, in last 25 years, have already added more than 600 GW.

  • Even if we do not compare the per capita consumption of electricity between India and developed nations, and limit it to the comparison with China, India has achieved a level of 640 Kwhr per head per year as compared to China which has achieved almost 2,000 Kwhr, more than three times of India. Thus, India has a long way to go.

  • The Fourth Report of the IPCC projects a very discomforting scenario of consequences of global warming. Obviously, China and India are adding large capacities, India even of higher proportion, considering its baseline of capacity. There is no choice if India has to reach the level of per capita consumption in next 25 years, what China has already achieved.

  • In the light of above challenges, the energy development strategy of India has given set of options. It cannot but proceed on all possible options. The sheer size of the needs is such that it can ill afford to leave certain technology options in favour of certain other means and methods of producing power, atleast in the medium term. For example, it will be impossible for India if the option of coal based generation was to be left out. As a matter of fact, its dominant role atleast in the medium term, cannot be wished away. No doubt, cost effective clean coal technologies will need to be deployed so as to minimise carbon emissions.

  • Considering the needs of environmental safeguards, one of the strategic directions, which the country has finalised, is to implement massive capacity addition programmes by harnessing the hydro electric potential of the country, which is of the order of 150 GW. The present capacity is only 35 GW. There are major initiatives of the Ministry of New and Renewable Energy to identify and execute a large number of micro and mini hydro electric projects ranging from KW to 25 MW. Substantial supports are provided by both the Central Government and concerned State Governments.

  • There are, no doubt, areas of concern in relation to large hydro electric projects, particularly those which involve large areas of submergence and are primarily storage projects. This issue is, in fact, a global issue. Resistance to storage based hydro projects is a common phenomenon in most of the countries. For last several decades, energy development relied heavily on using fossil fuels. The technologies have been rather simple, construction less complex and gestation periods to complete these projects comparatively short. The world as a whole, under this background, started discovering vices associated with hydro electric projects more than virtues which these projects inevitable provide to the society. Climate change concerns received somewhat diluted attention and priority. And, as a result of misplaced thrusts and misconceived notions, what the world is faced today is the consequence of global warming projected by the IPCC even though 80% of hydro electric potentials which would have provided green energy to the world, have remained unexplored and untapped. There is a need for a global consensus on recognising all hydro electric projects as Renewable Energy Schemes irrespective of their size and nature - whether run of river or storage projects.

  • No doubt, a major reason for large dam hydro electric projects being opposed has been the less than required priority and attention to the issue of rehabilitation and resettlement of project affected people. A few projects, in which the project developers did not pay required attention, has been responsible for creation of a mindset all over the world that storage projects, as such, are responsible for hardships to the people and, therefore, they must be opposed. Rehabilitation and resettlement, on a liberal scale acceptable to the people, could reverse the trend of thinking in favour of such projects which not only can provide renewable energy but can be a source of channelized and regulated irrigation. Besides, these Schemes are also able to manage and control floods and eliminate difficulties and hardships caused by such floods.

  • It is essential that a proper communication drive, including road shows, should be conducted globally to convince people that harnessing the untapped hydro electric potential could prove to be a substantial, if not total, answer to ever increasing green house gases. Simultaneously, such a campaign must also be directed towards the hydro electric project developers emphasising the need for a more reasonable, liberal and generous approach towards compensation, resettlement and rehabilitation. All care must be taken by them to see that the local area is provided with required infrastructure, amenities and avenues for earnings.

  • India's National Electricity Policy (2005) as well as Integrated Energy Policy (2006) emphasise the need for upscaling the nuclear power capacity from present less than 3% to about 7% by 2032, which means raising the capacity from about 4,000 MW to about 60,000 MW in 25 years. Nuclear power would thus constitute an important ingredient of India's programmes to mitigate climate change concerns.

  • At present, gas based power generation is about 10% of the total capacity. This technology is environmentally more benign. Though, on account of shortage of gas almost one third of the capacity remains unutilised, the discoveries in Bay of Bengal have provided opportunities to India to substantially increase the capacity, though in terms of proportion over a long period of time, the overall contribution of gas based power generation may not be higher than at present.

  • Responding to the needs of power generation to be compatible with environmental concerns, there are a series of programmes of the Government of India to explore and tap all possible sources of new and renewable energy. This approach and conviction has already made India one of the four largest in the world, in the field of power generation through wind energy. Generation through micro hydel, bio-mass, solar and other forms of electricity generation through new technologies have been incentivised. There is a thinking that such schemes should receive even better encouragement, incentives and appropriate support and facilitation.

  • The Former Cambodian Ambassador to Japan Mr. Pou Sothirak elaborated his paper on Energy Security. He described, in detail, the difficulties and hardships that have been caused on account of hydro electric projects developed by China on the Mekong River. This paper, on the basis of the specific experience has attempted to highlight the problems associated with storage based hydro projects, particularly the difficulties that could be caused to the countries downstream of the river. During deliberations, however, Mr. Ambassador did appreciate the way sufficient care was being taken care while developing hydro electric projects in India. The thrust of his articulation was that hydro electric projects per-se were not to be discarded, but what was needed is the appropriate sets of actions to take care of not only the problems in the local areas but also problems that could be caused in the countries downstream of the river.

After outlining the background of the India's Energy Policy and Strategy, I also outlined, in brief, as given below, the scope for Regional Cooperation between Asean and India in the field of energy:

  1. The most important requirement would be the connectivity for transmission of power. It is possible to connect India and Myanmar through an appropriate power transmission grid. This will facilitate movement of power from one country to another depending on the extent of surplus in either of them. Similar connectivity may be considered for other countries but that would require a more careful consideration because of intervening sea. With other countries where connectivity will be comparatively easier, from the point of view of logistics, feasibilities of such projects may need to be established.

  2. Gas pipelines among the Asean Nations and India would be another initiative that could facilitate enhancement of energy security in the region. This infrastructure, subject to other commercial arrangements which could be mutually arrived at, can lead to optimum utilisation of gas energy.

  3. Myanmar has hydro electric potential, it is estimated, of the order of 80,000 MW. Myanmar's own needs for larger amount of electricity would progressively increase but tapping these hydro potentials to export power to other countries including India, which needs much more power, would be of mutual benefits. Some studies have been undertaken in this regard and beyond these studies some further understanding has also emerged in respect of development of Tamenti Hydro Electric Project. This holds a good potential and a good starting point. Successful development of this project may lead to many more such projects being undertaken by Indian agencies including those in the private sector. What will be needed is the right type of support mechanism in Myanmar to deal with such initiatives, so that speedy decisions are taken.

  4. Among the Asean Nations there are coal reserves, such as in Indonesia. Their own need is limited. Commercial exploitation of coal mines can provide good source revenue for the country and could enhance energy security in the region. A number of Indian companies, both in public and private sectors, have, in last couple of years, started exploring acquisition of coal mines in Indonesia. An institutionalised arrangement under the purview of Asean - India Cooperation could facilitate required support to these companies so that decisions are taken in an objective manner without protracted delays. Such a co-operation would also provide, in a co-ordinated manner, authentic information about details of coal reserves, characteristics of mines, status about ownership of mines etc.

  5. Some of the countries in the region, such as Singapore, have also started divesting their power utilities. A number of Indian companies have shown interests and have participated in the tender process. This is a good development. This type of an initiative provides enormous scope for mutual co-operation in the region and Asean - India Co-operation platform could facilitate smooth implementation of such initiatives.

  6. Finally, in the energy sector among these nations, high standards and outstanding performance benchmarks in different aspects of energy management, have emerged. Interactions among the nations for sharing of such experiences could provide good scope for capacity building to the mutual advantages of all the concerned nations. These could also cover, apart from the supply side management issues including energy production, the important need for effective Demand Side Management (DSM) including energy efficiency. This is the need of the hour. Energy saving is a global necessity. Effective steps in this direction would mean a significant contribution towards mitigating climate change concerns. This area of co-operation, therefore, can go a long way in not only enhancing energy security in the region but may also make its important contribution towards carbon reduction.

Energy is such a subject in which co-operation among the nations has emerged as a global need. Different types of permutations and combinations of such co-operation should emerge. The objective should be to create a win-win situation. It can be nobody's case that untapped hydro electric potential keeps getting wasted with water flowing out of different river systems into the sea and its potential is not fully harnessed for benefit not only of the concerned country but for others as well. This is a clear case where nobody can be a loser and therefore such initiatives need to be pursued with required conviction, commitment and urgency. Energy efficiency and sharing of experiences of successes, as also failures, can be of great advantage to all the participating nations. This is another example where everybody gains and nobody loses and therefore this requires similar approach of committed mutual understanding, co-operation and action.