By Rishabh Diwakar
We are energy secure when we can supply lifeline energy to all our citizens irrespective of their ability to pay for it as well as meet their effective demand for safe and convenient energy to satisfy their various needs at competitive prices, at all times and with a prescribed confidence level considering shocks and disruptions that can be reasonably expected Planning Commission of India.
The planning commission has very well defined the term energy security, but the problem is – there is no proper road map for achieving the energy security. India wants to achieve energy security by 2020 and energy independence by 2030 but the recent events has changed the wind and made it difficult for India to achieve its goals. Moreover the politics and reform paralysis has further pulled down the hope.
So far India has failed to achieve the right energy mix. It heavily dependents on the fossil fuels especially on coal and oil. About 70% of our total demand of energy is met by importing oil. The government is unable to identify the right energy mix. About 70% of India’s energy generation capacity is from fossil fuels, with coal accounting for 40% of India’s total energy consumption followed by crude oil and natural gas at 24% and 6% respectively. The rising price of coal, gas and oil in international market has made difficult of India to have a sustainable growth. One rumor was heard a few months back during visit of John Kerry that US offered priority access to its shale gas output as long as India agreed to reduce its oil imports from Iran. This shows the independence and paralysis in Indian Energy sector especially concerned to its foreign policy.
Pricing at production and consumption has been a key issue for India. It has succeeded to keep the prices under control for consumption ignoring the production cost which has led to disruption in supply of fuel. A good example is the natural gas pricing. The price of natural gas was fixed at $ 4.2. The private sector could not supply the gas at this price to the consumer. This led to the decrease in production and disruption in supply. This also led many power plants to shut down and many other industries, dependent in gas, also suffered. Recently a cabinet committee increased the natural gas from $4.2 to $8.4 mmbtu. The benefits of this price increase, which was opposed by the power ministry, will accrue to a few companies. The possible solution could have to make a regulator and let the price be decided by the market through demand and supply.
In addition to domestic reforms, the global politics also plays an important role. The Iran-Pakistan-India and Myanmar-Bangladesh-India natural gas pipelines are in limbo due to international politics. India is planning an 1100 km sub-sea pipeline from Oman. The Turkmenistan-Afghanistan-Pakistan-India pipeline will transport 3 billion cubic feet of natural gas per day over 1700 km. Both projects are subject to political and economic uncertainties.
Measures have to be taken now if India wants to achieve its definition of energy security.
rishabhdiwakar@hotmail.com