Saturday, November 6, 2010

A cursory look at the Indian energy scenario would readily reveal the fact that India is now steadily moving towards a stressful period of energy crisis. What is even more alarming is the fact that adequate and innovative forward planning measures are yet to be implemented to face the impending energy crisis with the urgency that it deserves.

It is unfortunate that many of the energy generation schemes of the Government of India are still in the formative and discussion stage and quite a number of schemes discussed in the past have not moved on adequately.

While India is the fifth largest country in terms of power generating capacity in the world, with around 160,000 MW per annum, there is shortage of 10% power almost throughout the year in the country. The transmission loss of power is around 27%. This means that one fourth of the power generated in the country goes away as loss. Obviously, the task of curbing the transmission loss is extremely important.

Unfortunately, with the present measures being implemented, it appears that the transmission loss will remain almost at the present level in the foreseeable future. Government’s lack of sense of urgency and strategy to tackle this problem causes concern.

If India were to maintain the GDP growth of 8% per annum in future, the power generating capacity has to be stepped up atleast by 12 to 13% per annum. In other words, the country has to build power generating capacity of 18,000 to 20,000 MW per annum every year ..

Considering the slippages in the implementation of the planned power projects during the IX, X and XI Five Year Plan period, building up such power capacity every year appears to be a tall task.

The government is announcing various schemes such as boosting solar power capacity by 20000 MW by 2022 which , considering the present progress looks like an utopian target. While the government is targeting such huge solar power capacity, India has no production capacity for poly crystalline silicon which is the starting material for the solar power production. For every MW of solar power capacity,10 tonnes of poly crystalline silicon is required. 

Planning for solar power projects without creating capacity for poly crystalline silicon is similar to the act of putting the cart before the horse.
The Indian dependence on import of poly crystalline silicon will be total.

The Government of India is targeting to set up number of nuclear power projects which call for import of technology and fuel. As on today, there is no clear indication as to what would be the cost of the nuclear power projects with the imported technology and reactors and what would be the cost of nuclear power generated.

It is expected that the cost of nuclear power can well be over Rs.17/- per unit. In the same way, the cost of solar power would also be more than Rs. 16/- per unit.
Obviously, the consuming industries cannot afford to buy power at such price and will the Government extend subsidy and to what extent ? The government of India has not explained its stand and strategies to the people.

India is now importing more than 60 million tonnes per annum of coking and non coking coal. With the Government of India setting a target of generating one lakh MW of additional power by 2020 and most of which are planned to be by coal based ultra mega thermal power projects, it is predicted that Indian import of coal will exceed 230 million tonnes in another ten years with the indigenous production of coal likely to go up only marginally.

The price of coal is already going up in the global market and India will become extremely vulnerable to the international price and availability scenario for coal. Government of India has not revealed any strategy as to how it would tackle the situation, except companies like Coal India and some private units trying to acquire some mines abroad.

The crude oil production is virtually stagnant for the last several years and 90% of the Indian crude oil requirement by Indian petroleum refineries is now being met by imports.

The scenario is equally grim in the natural gas front with the country planning to import 20 million tonnes of LNG (liquefied natural gas) by 2020 which itself would be inadequate.

The above figures at a glance only show the grim reality that the Indian economy and its fundamentals would be at the mercy of international energy supply scenario and the energy suppliers. 

Under the circumstances, India would cease to be a self reliant economy. With the fundamentals of Indian industry and economy being threatened by such huge import dependence on which the country would have no control, India is bound to suffer from an energy crisis that can potentially upset the stability of the economy and industries at any time in future.

While the situation is as grim as this, one wonders as to what the Government of India and the Planning Commission have in mind. They are announcing policies and programmes as if announcements are solutions. The ground reality is that the things are moving at inadequate pace and we seem to be approaching towards the impending energy crisis with sort of helplessness.

It is not that India does not have other self reliant options and the Government and the Planning commission are aware of the options, which include shale gas , algae biofuel, jatropha bio fuel , geo thermal energy, off shore wind energy project, gas hydrate , hydro electric project in the north eastern region , power from garbage etc.

With regard to all these options, the government is still in the planning and discussion stage and it does not seem to realize that seminars and conferences are no substitutes for actions on the ground.

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